In a newly published article, the White House is advising physicians to accept a life in Big Medicine — as a hospital employee or member of a large group practice — in the wake of healthcare reform.
Some leaders of organized medicine, however, are objecting to the government message.
"We're not ready to write off the small practices," J. Fred Ralston Jr, MD, president of the American College of Physicians, told Medscape Medical News. "We think there needs to be more than one delivery model."
Dr. Ralston and Dr. Williamson were responding to an article by 2 White House officials and 1 ex-official about the implications of healthcare reform.
"The economic forces put in motion by the [Affordable Care] Act," the authors write, "are likely to lead to vertical organization of providers and accelerate physician employment by hospitals and aggregation into larger physician groups." Physicians who embrace the changes and opportunities created by the law "are likely to deliver the greatest benefits to their patients, the health system, and themselves" and "will be rewarded in the future payment system."
What does it mean to embrace "vertical organization?" This business catchphrase refers to enterprises with a hierarchal structure and centralized management. An integrated delivery system that owns hospitals, medical practices, and other healthcare services is a prime example. Other examples are the military and the federal government.
The growth of vertical healthcare organizations, as well as large, independent group practices, has slowly dismantled medicine as a cottage industry. The percentage of physicians in solo practice declined from roughly 41% in 1983 to 25% in 2007 - 2008, according to data from the American Medical Association. According to an oft-quoted study from the Center for Studying Health System Change, the percentage of physicians who are solo practitioners or are practicing in groups of fewer than 6 physicians fell from 53% in 1996 - 1997 to 42% in 2004 - 2005.
The White House officials say healthcare reform will further the trend toward aggregation. The new law lays the groundwork for financially rewarding providers based on the quality of the care they render through accountable care organizations (ACOs) and patient-centered medical homes. ACOs consist of physician practices and hospitals that take joint responsibility for meeting performance measures for quality and cost, and they either earn bonuses or incur pay cuts depending on how they perform as a group. In a medical home, a patient receives holistic, long-term primary care from a multidisciplinary team usually led by a physician, with insurers paying extra for coordination of care with outside providers.
In these new models, there needs to be information technology — as in electronic health records — and administrative personnel to "track quality measures, account for and manage shared financial incentives, and oversee care coordination," the authors write. Accordingly, the healthcare system will gradually organize itself around either hospitals or physician groups.
Past Experience With Hospital Employment Not Encouraging
Dr. Ralston of the American College of Physicians points to the unhappy experience that physicians had when droves of them went to work for hospitals in the 1980s and 1990s. Many of those marriages broke up.
"Most doctors who were employed by hospitals found the arrangement lacking," he said. The well-being of medical practices took second place to the well-being of the hospital, and the loss of independence proved painful.
Physicians in small practices can enjoy the benefits of larger organizations without giving up their independence, Dr. Ralston said. Computer technology, for example, can allow small rural practices to share common employees who tackle quality-improvement chores. And computer technology allows independent practice associations (IPAs) to function as group practices. A case in point, said Dr. Ralston, is the Mesa County Physicians IPA in Grand Junction, Colorado — a community celebrated for improving patient care while lowering costs. Healthcare reformers, he said, need to gather more evidence on how large and small organizations perform in the new framework of quality goals and financial incentives.
"I agree wholeheartedly that the law will push physicians into larger groups," said Dr. Williamson, who also is a spokesperson for the Coalition of State Medical and National Specialty Societies, which campaigned against the Affordable Care Act. "I don't think that's the role of the federal government to be doing that."
Dr. Williamson said the law will only add to the regulatory burden that has forced small-practice physicians to seek refuge in a hospital or mega-group. Many physicians, he predicted, will not accept the new paradigm and will instead leave patient care, leaving medicine even more short-handed.
He conceded that some vertical organizations in healthcare, such as the Veterans Health Administration, perform well. "But we need pluralism," said Dr. Williamson, a member of a 3-physician practice. "We need soloists as well as groups."
"The game is not over for small practices," Dr. Ginsburg told Medscape Medical News, "but it's over for small practices operating in a bubble on a piecemeal basis, ignoring the rest of what's happening to their patients. They can't just be cottage industries."
Echoing Dr. Ralston, Dr. Ginsburg said IPAs show small groups a way forward. "IPAs are keeping medical practices viable in California," he said. He noted that their record of success has occurred in a state where managed care remains vibrant. There, managed care has pioneered the use of pay for performance, which figures prominently in the new healthcare reform law.
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