Hospital-physician alignments may wind up costing more

Increased alignment between hospitals and physicians, while touted as a means to improving quality and cutting costs, may in some instances have the opposite effect.

A new issue brief by the Washington, D.C.-based Center for Studying Health System Change has yielded mixed results.

"Even though hospitals are employing these physicians, that alone does not guarantee that quality will improve or that costs will stay level," physician Ann O'Malley, one of the brief's co-authors, told Healthcare Finance News.

Indeed, hospital recruitment of physicians has heated up in many areas where payments are still fee-for-service, driving up the number of procedures performed. And physician demand is so strong that pay for their services is spiking.

"Hospitals are paying cardiologists over $1 million a year ... hospital costs are going up dramatically in our market. ... You are seeing a number of compensation offers that are multiples of what physicians had made historically," said some persons interviewed for the issue brief.

For more:
- check out the issue brief
- read the Healthcare Finance News article