Does hospital employment warrant higher reimbursements?

Tools

An investigation by The News & Observer and The Charlotte Observer provides more proof that hospital employment means higher prices for patients and higher reimbursement for providers.

Looking to reap bigger payments from Medicare and private insurers, hospitals increasingly are acquiring doctor practices and converting those practices to outpatient entities or hospital facilities, The News & Observer reported.

For example, Duke University Health System saw its outpatient visits grow 12.1 percent between 2009 and 2010, entirely due to converted clinics, the article noted.

While critics blame price increases on hospital-practice consolidation, hospitals maintain they deserve higher payments to compensate for compliance with regulations, fully-staffed departments at all times, and treatment regardless of time of day or ability to pay, The News & Observer noted.

Hospitals say that mergers and affiliations between physician practices and larger hospitals is necessary to coordinate care across the continuum, FierceHealthcare previously reported.

Hospital-practice consolidation also helps hospitals boost patient referrals and profitability and lends itself to the creation of accountable care organizations, the News & Observer noted.

Although industry experts acknowledge that reimbursements for extra services are warranted, they warn that the payment gap between hospitals and independent doctors is too extreme.

But that difference in payment has been driving independent doctors to choose hospital employment. In fact, nationwide hospital employment has practically tripled from 8 percent in 2007 to 24 percent in 2012, while physician-owned practices dropped from 73 percent in 2007 to 60 percent now, according to a survey released in September by the American College of Cardiology.

For more:
- read the News & Observer article

Related Articles:
Physicians reluctantly surrender practice independence
Hospitals blame health reform, low reimbursement for layoffs
Docs join hospitals for higher Medicare payments
Hospitals defend physician employment model amid FTC scrutiny
Hospitals, practices partner for higher reimbursements