2018 Healthcare Outlook

TREND #3: MANAGING UP PHYSICIAN ACQUISITIONS

Loss per employed physician is the de facto measure of "success" for acquired physician practices. To overcome this, health systems need to manage up acquisition ROI, rather than manage down the losses.
Loss per employed physician is the de facto measure of "success" for acquired physician practices. To overcome this, health systems need to manage up acquisition ROI, rather than manage down the losses.

GROWTH IN HEALTH SYSTEM PHYSICIAN ACQUISITIONS DRIVEN BY:

Increase in physician nonclinical responsibilities, income insecurity

+

Affordable Care Act poured gas on the fire through "meaningful use," ACOs, MACRA

=

EMPLOYED PHYSICIAN GROWTH UP 76%, 2003-20141
2016 = 1ST TIME MAJORITY OF PHYSICIANS DIDN'T OWN THEIR PRACTICES2
EMPLOYED PHYSICIAN GROWTH UP 76%, 2003-20141
2016 = 1ST TIME MAJORITY OF PHYSICIANS DIDN'T OWN THEIR PRACTICES2

WHY THE LOSSES

Physician employment rationale a moving target:

Market share/market growth strategy?
Response to competitor acquisitions?
ACO or "leverage the payers" strategy?

WHY THE LOSSES

Physician employment rationale a moving target:
Market share/market growth strategy?
Response to competitor acquisitions?
ACO or "leverage the payers" strategy?

OUTCOME: Median loss per employed physician tripled from 2004-2013, now ~ $185K3

WHAT PROVIDERS NEED TO DO

Manage practices instead of hosting them:

Subheadline About the Benefits

Benefit or idea number one should go here. Be brief with sentences.

Prune back employed doc portfolio to fit organization’s chosen strategy

Evaluate/strengthen leadership based on qualifications, not availability

Benefit or idea number two should go here. Be brief with sentences.
Benefit or idea number two should go here. Be brief with sentences.

Tailor physician compensation to organization's reimbursement mix to drive appropriate productivity

Leverage data to engage physicians, standardize use of devices/drugs proven clinically equivalent at a lower cost

Benefit or idea number two should go here. Be brief with sentences.
Benefit or idea number two should go here. Be brief with sentences.

Enhance revenue integrity, ensuring patient data is captured and translated into a fair, timely bill

  1. Getting the Most Value From Your Physicians; H&HN; 10.11.16. 
  2. Policy Reserearch Perspectives, AMA; 5.17.
  3. Evaluating Reasons for Physician Practice Losses; HFMA; 12.14. 

Additional trend insights via LinkedIn: Managing Up Physician Acquisitions

Thank you for subscribing.

Connect With Us