Physician practices are facing new obstacles as they try to balance patient care with business priorities. Here are five healthcare trends impacting physician practices today.
Physicians are facing new challenges as they balance patient care with business priorities. Restrictive insurance rules, government regulations and declining compensation are just a few of the obstacles that modern practices are up against.
Despite these challenges, successful practices are identifying solutions to these business pressures. Here are five trends shaping the healthcare industry. As we approach 2020, administrators should consider how these trends may impact, and potentially improve, their practices’ outlook.
Faced with rising costs and other pressures, some practices are selling ownership to hospitals or larger practices so physicians can focus on patient care. Hospitals acquired more than 5,000 practices between July 2015 and July 2016, increasing the number of hospital-employed doctors by 9 percent, or more than 14,000 physicians in the U.S. that year, according to a 2018 report from Avalere Health and the Physicians Advocacy Institute. With national health insurance companies also making acquisitions, fewer than half of all physicians now have an ownership stake in their practices, according to the report.
However, not all physicians are selling. Some physicians are finding it difficult to get an adequate price for their practices. Primary care physicians may choose to invest in technology and non-physician staff to increase practice efficiencies. Meanwhile, other practices are opting to move to a concierge model that focuses on more personalized attention to a smaller patient base.
Similarly, specialist practices are increasingly selling stakes to private equity firms to avoid being acquired by hospitals. This allows them to keep an ownership role in their practices and maintain strong patient relationships while also benefitting from management expertise and the opportunity to share in profits if the private equity partner decides to sell the practice.
Retail medical clinics and urgent care centers are becoming more popular - and are increasingly owned or operated by physicians. Today, more than 7,600 urgent care centers in the U.S. see a combined total of more than 890 million patients per year. Meanwhile, U.S. retail clinics took in about $1.4 billion in revenue in 2016, more than doubling their revenue from 2010. Since most insurers cover nontraditional care outlets, these clinics continue to emerge as tiny-yet-mighty competitors to larger physician practices.
Therefore, physicians must continue delivering on the value of having an ongoing doctor-patient relationship, one that considers a deeper understanding of a patient’s health history, which is not common in an urgent care setting. Some physicians are responding to the growing consumerism by extending practice hours or opening emergency clinics, increasing their cooperation with nontraditional care settings by linking electronic health records (EHRs) and using outside clinics as referral sources for new patients.
While healthcare regulatory reform has increased some reimbursements, it has also posed potential penalties related to reporting quality standards and the documented use of EHRs. Meanwhile, political attempts to alter or eliminate the Affordable Care Act have brought additional uncertainty for physicians and their practices.
As a result, many physicians are postponing important decisions to expand, sell or participate in new patient-centered medical homes, affordable care organizations and other innovations encouraged by the current law.
Physician practices looking to hire non-physician providers are increasingly competing for candidates who have a wide range of job options. The strong demand has increased the number of physician assistants by 40 percent from 2010 to 2017 and has propelled nurse practitioners to No. 3 in the U.S. News and WorldReport’s Best Jobs Rankings for 2018.
Technology-based, on-demand services can help address staffing lags and logjams by directing physicians and nurses to practices whenever they are needed, much like today’s ride-share services. These services give physicians the opportunity to choose their own hours and perhaps make more money than they would in other practice settings, while increasing their ability to provide healthcare services.
While technology is fueling changes in how practices care for patients, run their offices and bill for services, technology can also bring trade-offs in cost, efficiency and effectiveness. EHRs have helped simplify prescription services and insurance billing, but they also can create issues as practices select provider partners, integrate systems and train staff. Physicians need to consider technology upgrades with savvy and knowledge, researching what types of technology make the most sense for their specific practice and how they would be best implemented.
Moving forward, we will see continued adoption of artificial intelligence (AI), Big Data, robotics and 3D printing, which are all emerging as tools for improving patient care and practice operations. AI has the potential to provide decision-support for diagnosis and treatment, freeing physicians to concentrate on decisions that only they can make. Big Data, also called data analytics, can help practices learn more about what services work best with different categories of patients and how to make business processes more efficient. Robotics are already a significant part of surgical and radiological practices, while 3D printing is finding new uses in everything from dental surgery to orthopedics to joint restoration practices.
Technology is not a one-size-fits-all approach. The key is to determine what technology would enhance the practice business while increasing patient care quality.
The cost of doing business, the rise of consumerism, the evolving billing rules from insurance companies and the cost of implementing technology in medical practices are just a few of the obstacles facing physicians today. Yet among these challenges, there are more ways to deliver healthcare services than ever before.
Forward-looking practices and physicians are finding ways to maintain active roles in their communities while also adding access to the best expertise, tools and technology. These key decisions are likely to shape not only how physician practices will deliver healthcare, but also how their services will be consumed and valued in the future.
Mark Bennett is a southeast region executive for business banking at Bank of America.