The Loss of Private Practice Medicine to Corporate Entities

elkpark · Oct 16, 2007

On my most recent visit (after a fairly long absence), I discovered that the practice started by my physician of ~20 years is now part of the local "healthcare system" -- the three hospitals in the region; several nursing homes, home health agencies, etc., and, apparently, most of the (formerly) private practice physicians' offices in the area. I also just started a new job in the nearest decent-sized city with the local healthcare "system" which includes all the hospitals in the region (10 or 12, and they've just acquired two more -- they are expanding into an ever-larger area), nursing homes, home health, rehab, and about a kazillion outpatient physician practices.

I don't like the idea, but it certainly seems to be where healthcare is going (has already gone!). I'm sure this is another of those things that everyone has rushed into enthusiastically that will turn out in ten years or so to have been a really bad idea ... :uhoh21:

Healthcare is constantly changing; I'm sure some newer trend will come down the road any day now, and we'll all start jumping on that bandwagon.

oramar · Oct 17, 2007

There was this big fad around here about 7-8 years ago where a major medical center was running around buy up all these private practices. About 3-4 years ago they started kicking all the docs out because because so many were not making money. Several of my personal docs were involved in it and are now all back in private practice. My family doc told me all about it.

RNperdiem, RN · Oct 17, 2007

The costs of setting up a medical practice has never been higher. The equipment, office space and staff to hire do not come cheap to a heavy in school debt new doctor. Sometimes having the corporate entity do all the business end of the practice frees the doctor to focus on medical care. The downside is that the doctor becomes an employee and loses a lot of freedom.

This trend is not limited to medical practices. A generation or two ago, the country was filled with family farms, independent business practices, solo practice doctors and mom-and-pop stores.

underpaidrn · Oct 17, 2007

What do you think of the loss of private practices to hospital districts and corporate entities? It's been happening here. This came home to me recently when I asked a doctor friend to advocate for me to get a per diem job at the local clinic which was bought up by the hospital district about 3 years ago. The head of the clinic made a big point of telling me that the doctors there had no say in anything. I thought it was a slap in the face to the doctors there who started the rural clinic years ago and maintained it independently as a private practice until recently.
I called a practice where my husband had had treatments 10 years ago to obtain records yesterday. That doctor is now in a practice owned by the hospital there instead of a private practice. This seems to be the trend. What do you think? Is this good, bad or just different? Is the private practice headed for extinction?

In the area I live in the hospitals (2) are owned by a corporation as well as over 90% of all the physician's office. Here's a real kicker - they also own the insurance plan that the city uses for it's employees so they are getting paid from the premiums for this insurance as well as anytime it's used in their facilities. Talk about conflict of interest. No one in the area is willing to take them on because they have such power. They treat nurses like garbage but don't care because there are three nursing schools in the area and they always have more fodder for the cannon, so to speak. They have even begun to purchase hospitals and offices up to 50 miles away. It's ridiculous.

FireStarterRN, BSN, RN · Oct 17, 2007

In the area I live in the hospitals (2) are owned by a corporation as well as over 90% of all the physician's office. Here's a real kicker - they also own the insurance plan that the city uses for it's employees so they are getting paid from the premiums for this insurance as well as anytime it's used in their facilities. Talk about conflict of interest. No one in the area is willing to take them on because they have such power. They treat nurses like garbage but don't care because there are three nursing schools in the area and they always have more fodder for the cannon, so to speak. They have even begun to purchase hospitals and offices up to 50 miles away. It's ridiculous.

This sounds like it violates anti-trust laws. This sort of story is very concerning.

Jolie, BSN · Oct 17, 2007

When I lived in PA about 10 years ago, competing hospital systems were literally tripping over each other to buy up physician practices in order to have the physicians funnel patients into their systems. It was not too smart at the time, given that the market (Philly) was essentially controlled by 2 insurers who dictated the facilities that their patients could use. The physician had little say in where his/her patients received their out-patient or hospital care.

My pediatrician mentioned that his practice (a large group) had been solicited by a hospital system, and the senior partners were considering the offer. He couldn't understand why the hospital system would spend millions on a single practice that admitted very few patients to the hospital. (Most children are healthy and never require hospitalization. The age of 1 month - 18 years is the time of life when hospitalization is least likely to occur.)

The practice sold for a multi-million dollar price tag, the physicians became salaried employees, and the hospital system spent a bundle renovating the offices. Within a year or two, they were asking the physicians to buy their own practice back, since it was not making money for the hospital system. My pediatrician thought if they held out long enough, the hospital system would simply release them without the physicians having to repurchase their practice.

Just another example of stellar healthcare administration and a huge waste of money.

FireStarterRN, BSN, RN · Oct 17, 2007

When I lived in PA about 10 years ago, competing hospital systems were literally tripping over each other to buy up physician practices in order to have the physicians funnel patients into their systems. It was not too smart at the time, given that the market (Philly) was essentially controlled by 2 insurers who dictated the facilities that their patients could use. The physician had little say in where his/her patients received their out-patient or hospital care.
My pediatrician mentioned that his practice (a large group) had been solicited by a hospital system, and the senior partners were considering the offer. He couldn't understand why the hospital system would spend millions on a single practice that admitted very few patients to the hospital. (Most children are healthy and never require hospitalization. The age of 1 month - 18 years is the time of life when hospitalization is least likely to occur.)
The practice sold for a multi-million dollar price tag, the physicians became salaried employees, and the hospital system spent a bundle renovating the offices. Within a year or two, they were asking the physicians to buy their own practice back, since it was not making money for the hospital system. My pediatrician thought if they held out long enough, the hospital system would simply release them without the physicians having to repurchase their practice.
Just another example of stellar healthcare administration and a huge waste of money.

Facinating. I wonder what will happen if we get a universal, government funded healthcare system? How does it work in Canada?