The August 30-31 Wall Street Journal reports "Carilion Buys Imaging and Surgery Center." The Carilion Clinic, a $1 billion dollar enterprise in Roannoke, Virgina, has bought the Center for Advanced Imanging and the Center for Surgical Excellence in Ronaoke. These purchases follow by several days Carilion's acquisition of the 9 percon Consultants in Cardiology group, also in Roanoke and the largest cardiology group in Southwest Virginia.
What's going on here? It is quite simple. The Carilion Cliics is following a Mayo-Clinit-type strategy of forming a dominant regional health system by either buying up or hiring its competitors. This strategy is apparently succeeding despite opposition by some 70 independent physicians in the Roanoke valley and concerns about monopolstistic behavior.
About 20 years ago, Paul Ellwood, M.D., father of managed care, envisioned a health system controlled and channeled through 10 or so major megaclinics, clinics like Mayo, the Cleveland, Temple, Geisinger, Marshfield, and Mayo Clinics.
Is Ellwood's vision materializing? Yes, but it's spotty, and is led by a small group of medical leaders and visionaries, who feel they are doing the "right thing." It may be happening with Carilion, an eight hospital enterprise that employs 11,000, has hired 150 physicians over the last year bringing its numbe3rs to 500, is erecting a large clinic building in Ronaoke, and has received approvoal of establishing a new medical school, the Carilion-Virginia Tech medical school.
The basic thought here is that every region needs a comprehensive, integrated health system with salaried primary care and specialty physicians and with sufficient infrasctructure to meet most patient needs and to connect physicians and hospitals and ancillary facilities with an electronic medical system to measure quality and outcomes.
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Putting doctors on a salary is a disaster for patient care. It incentivizes laziness and shirking of responsibility. Early in my career, I worked for a large multispecialty group that had recently acquired a hospital and put their physicians on salary. They couldn't figure out why they were losing millions upon millions of dollars. But the docs kept drawing their salaries while telling everyone it was primary care's fault for not taking on enough of the care of the patients. Eventhough we would admit ventilated, hypotensive patients to the ICU at 3 AM so the specialists didn't have to get out of bed. One specialist didn't even submit any superbills for a year but kept drawing his salary of course. The good and consciensious docs get overworked and burned out while the lazy ones shift all their work onto others and get promoted to the "board" where they don't take call and have lots of administrative time. I wouldn't want to be in an ER with the need for emergency surgery and have them calling a doc on salary who knows he gets paid the same whether he comes in or not.
I will say that these large groups have been able to deploy some impressive EMR and IT solutions and this may pay divideneds in patient care in the future. That is yet to be demonstrated.
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