Could Stark, ARRA subsidy programs be accelerating healthcare consolidation?

An effort as large as the federal EMR subsidy program was bound to have at least a few unintended consequences. One such negative effect seems to be the consolidation of care into large organizations in many markets, according to BNet columnist Ken Terry.

It's a problem that actually started in 2006, when HHS created the exemption to the Stark physician self-referral and Medicare anti-kickback rules to allow hospitals and health systems to help affiliated physicians purchase EMRs.

"Hospitals' desire to show 'meaningful use' and cash in on the health IT incentives by exchanging data online with their doctors is only one reason for this trend," Terry writes. "Hospitals have always competed for the physicians who fill their beds with patients, and as they employ more and more doctors, this competition is becoming fiercer. Moreover, many healthcare executives expect they'll have to combine forces with doctors in the near future to obtain bundled payments and other types of reimbursement that will require providers to meet quality benchmarks."

And as hospitals install their own EMRs, physicians with staff privileges at more than one organization often are being asked to learn different systems. Many doctors are pushing back. "Physicians are being forced to choose sides, and the wedge that many hospitals are using is the offer of technical and/or financial assistance in obtaining an EHR," Terry says.

Meanwhile, Health Data Management reports that one session at next week's Healthcare Financial Management Association Annual National Institute conference in Las Vegas will address this very topic. "As physicians become more dependent on the technology and interoperate, they become more reliant on the hospital," says Daniel Marino, vice president at Chicago-based consulting firm Health Directions. Marino will present during that session.

For greater detail on this argument:
- read Terry's post on the BNet Health Care Blog
- take a look at this NextGov "Health IT Update" post
- see this Health Data Management story