By: Dr. Ken Teufel
Driving this apparent trend is the Affordable Care Act. In order for hospitals to meet the ACA’s requirements, hospital acquisition of independent physician practices is expected to grow by 71 percent over the next three years, according to Deloitte Consulting LLP. “Hospitals need to identify, employ, and align with the right physicians or risk being left behind.” Physicians, for the most part, seem to be in favor of such arrangements as they seek a better work/life balance, something hard to achieve in independent practice. Also, most doctors say they are ill-prepared for the business-related demands of practicing independently, especially in today’s health care environment.
Six years ago, 16 percent of medical residents said they did not feel competent to take on the business of running an independent practice. Today that number is up to 48 percent. In 2001, only 3 percent of residents said they would rather work for a hospital than practice independently. Ten years later, that number had risen to 32 percent.
A few years ago, from 2003 to 2007, the University of Michigan surveyed 58,000 U.S. medical students and found “an overwhelming majority were confident about their clinical training. But when it came to understanding health economics, the health care system, managed care, managing a medical practice or medical record-keeping, 40 percent to 50 percent of students reported feeling inadequately prepared” (Academic Medicine, September 2009).
Despite these data, the total disappearance of independent medical practices in the foreseeable future is unlikely. A desire for preserving their autonomy will continue to motivate a significant number of physicians to set up practices outside hospital settings. Witness the growth of concierge medicine and the popularity of locum tenens careers, two ways in which the business side of practicing medicine can be effectively outsourced. In addition, like-minded physicians, practicing solo or in small groups, are likely to join forces to purchase managerial expertise. Regardless of how physicians choose to practice medicine in the future, they must never forget that the “business” of medicine is still about what’s best for the patient.
(Reference: “Physician Hospital Employment: This Time It’s Different.” An issue brief by the Deloitte Center for Health Solutions, 2013).
About the author: Dr. Ken Teufel is the medical director at Interim Physicians, a pioneer locum tenens physician staffing firm based in St. Louis, MO that has provided quality physician coverage to hospitals, clinics and other healthcare facilities since 1979.