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Could Physician Ownership Save Healthcare?


Anti-competitive trends and consolidating hospitals purchasing physician practices, are crushing patients with higher costs and poor service.

I was in the hospital business for a long time, and despite the economic burden of generally overpaying for physician practices and losing money operating them, our hospitals bought a lot of physician practices and profited immensely as a result.

The practices we purchased were not necessarily full of the best doctors. A good personality, good patient load, cooperative attitude, and the business will flow back to the hospital. Imaging, inpatient services and procedures, outpatient services and procedures, he more the better. Mediocre outcomes make for return customers.

After all, if you can't control the prescription pad, the next best thing is to control the pen and have it beholding to you. Insurance, kept them fragmented, hyper-specialized, and focused on treating hospital employees and families so the hospital was self-insured efficiently and effectively.

Sound cynical? Unethical? Contrary to the best interests of public health?

Not really. In a system where the price of everything is the focus and the cost is not, it is more a survival strategy, propping up the most wasteful, dysfunctional healthcare delivery system in the world.

Look at the U.S. healthcare system like a balloon. Squeeze prices and cost (utilization) goes up. Squeeze cost and prices go up. Squeeze both and provider failures go up while access to care and quality go down.

Squeeze one part and others expand – always at the weakest points. What we need is an asymmetrical solution. Within the bounds of reality and outside of the obvious.

A good illustration of asymmetrical thinking is the riddle "Which is faster? Emptying a bathtub with a cup or a bucket?"

Conventional wisdom would be a bucket.

Asymmetrical wisdom is to pull the drainplug.

The Wrong Conversation

The first thing we need to do is to call things what they are. For example, "restoring the patient-physician relationship," while legislating insurance reform that virtually forces the consolidation and primacy of hospital systems which rely on a steady stream of sick people and run on bureaucracy and reducing independent physician compensation so low they are forced to roll patients through like marshmallows in S'more season, does the exact opposite.

That leads to calling health insurance reform healthcare reform. It is not only misleading, it is disingenuous and insulting.

Healthcare reform is fixing a broken, bloated, dysfunctional hospital-centric healthcare delivery system to make it more patient-centric and move the patient relationship from institutional behemoths to doctors who will manage care, not maximize it. That will never happen by trying to spread the cost among more people, perpetuating the status quo.

It will happen when physicians, free of the shackles and pressures of institutional providers with numerous conflicts of interest, are equipped, enabled, empowered and paid to provide high quality service and superior outcomes.

Putting hospitals in charge of improving health status instead of managing health crisis is like putting tobacco companies in charge of smoking cessation.

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