Tuesday, September 23, 2014

Hospitals V. Doctors: Advantages and Disadvantages

To what advantage would it be?

Cicero (106-43 BC)

Prudence consists of power to recognize the nature of disadvantage.

Machiavelli,(1469-1527), The Prince>

One of those things you hear little about is competition between hospitals and doctors. In the minds of the public, the two are supposed to collaborate rather than compete.

The subject of collaboration comes to mind for two reasons:

One, the competition between hospitals and doctors for their share of ambulatory surgery market. Because of higher hospital rates for ambulatory surgeries, the desire of surgeons for more direct control and efficiency of outpatient surgical procedures, and the search of payers, employers, and patients for lower costs, direct pay ambulatory surgery centers are actively competing with hospitals for the outpatient surgery business.

Two, hospitals are seeking ways to lower costs because of insurer and government pressures and lower reimbursement rates. One effective way of doing this is to standardize physician behaviors (Jeanne Whalen,”Hospitals Cut Costs by Getting Doctors to Stick to Guidelines, Wall Street Journal, September 22, 2015).

This is part of hospital push to reduce costs by standardizing care. The idea is end overuse of tests and procedures - like routine cardiac monitoring or MRIs or CT scans for headaches or lower back pain. Some doctors resist this standardization, saying they sometimes must order these tests or procedures to avoid being sued.

In the competition-collaborative tug of war, hospitals have most of the advantages. Hospitals have scale. They are large organizations with political and marketing advantages, they lie at the center of most communities, and physicians as a rule must belong to hospital staffs to be legitimate health care providers.

Doctors, on the other hand, say they must reserve the right to do what is necessary for the health and survival of patients, and retain the flexibility to exercise their best clinical judgment. In the case of outpatient surgical procedures or concierge practices freed of the restraints and expenses inherent of third party regulations, physicians claim they can control time spent with patients, can use the most appropriate tools and procedures and staff, and can exercise the necessary autonomy to do what they are trained to do.

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