Monday, December 03, 2012

The Storm of Reform

The consolidation of the professional and institutional components of health care (notably physicians and hospitals) is an essential but very difficult part of health care reform.  There is not much hope for significant improvement in both quality and efficiency so long as the system lacks accountability due to their separation. 

But bringing them together raises new issues.  

Throughout history, the medical profession has been the dominant force in the provision of health care.  Hospitals were often referred to colloquially as doctors’ workshops.  In later years, that relationship has begun to change, with more and more doctors selling their practices to hospitals and becoming hospital employees.  According to the news article referenced below, only about 39 per cent of U.S. doctors are currently in independent practice, down from 57 per cent in 2000.  The executive head of the American Hospital Association has been heard to say that the number of doctors employed by the hospitals he represents is greater than the membership of the American Medical Association. 

A front page article in the December 1 issue of the New York Times deals with the matter.  Titled “A Hospital War Reflects a Bind for U.S. Doctors,” the story is about the competitive situation in Boise, Idaho where together, the two largest hospitals now employ about half the doctors in southwest Idaho.  According to the story, the doctors now complain that the hospitals “have too much power over every aspect of the medical pipeline, dictating which tests and procedures to perform, how much to charge and what patients to admit.” 

In addition, the government anti-trust people are getting interested in the situation.  The authority granted to doctors to order tests and treatments has economic consequences for the providers of those services and for the cost of health care.  Historically, doctors and hospitals were separate business entities, presumably operating at arm’s length.  Now that they are together, the question is whether they are colluding to increase the amount of service provided, thereby driving up the cost of care. 

So unifying the system is not such a simple thing after all and some stormy times can be expected along the way.

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