In Practice: Your Hospitalist and You

September 1, 2008

Some primary-care physicians love hospitalists; some won’t touch ’em with a 10-foot pole. Here’s what you need to know about the hottest new specialty in medicine.


You won’t find a bigger fan of hospitalists than Peter Anderson. The Newport News, Va., family physician did rounds for 10 years before he signed up to refer his patients to physicians who handle only hospital patients.

“It’s been like night and day,” says Anderson, who works with two other physicians at Hilton Family Practice, one of 80 clinics owned by Riverside Medical Group. “I don’t have to do rounds or admit my emergency patients; I can even leave town on weekends when I’m on call,” he says.

Anderson says he had to mull the idea over for a few years before signing up with a hospitalist service. After calculating that using a hospitalist could eliminate 70 percent to 80 percent of his night calls, Anderson gave it a try in the late 1990s. Today, he’s a convert.

“The office is my domain, so my comfort level is much higher there than at the hospital,” Anderson says. “To top it off, I’m making more money because I can start 45 minutes earlier at the office and see three or four patients in that time as opposed to just one or two on rounds.”

If you aren’t using one of these specialists yet, you may be soon. Anderson and thousands of other physicians - primary-care physicians and specialists alike - find that using a hospitalist allows them to spend more time in the office producing outpatient revenue. And for some, just the promise of taking their weekends and evenings back is enough.

Growing fast

As Anderson and other physicians across the nation jump on the hospitalist bandwagon, the field grows by leaps and bounds. Today, some 20,000 hospitalists are working for hospitals, hospitalist groups, academic medical centers, large multispecialty groups, and integrated healthcare delivery organizations. That’s a far cry from the fewer than 1,000 estimated in 1996 by internist Robert M. Wachter, who coined the term in a New England Journal of Medicine article that year.

More growth is ahead, says Patrick J. Cawley, an internist who is president of the board of directors of the Society of Hospital Medicine. The hospitalist professional society, which has about 7,000 members, projects that the hospitalist workforce will top 30,000 within a few years.

As the profession grows, so does the competition to recruit new hospitalists. Surveys by the Society of Hospital Medicine peg hospitalist pay at an average total compensation of $193,000 nationally.

“The types of compensation are all over the place but increasingly more get a base salary plus a productivity incentive,” Cawley says. “It’s just like any other specialty in that those with incentives tend to be more productive than those on a salary.”

Time pressures

Hospitalists are credited with helping hospitals reduce the average length of stay while making modest improvements in revenue. A few studies indicate that hospitalists may help reduce mortality rates for hospitalized patients. But Cawley, who also is a chief medical officer at the Medical University of South Carolina Medical Center, says there are other factors behind this new specialty’s rapid growth.

“The biggest driver of the hospitalist movement is the primary-care physician,” Cawley says. “Primary-care physicians are leaving the hospitals and they are not looking back.” “It’s to the point where if a hospital doesn’t have a hospitalist program, or get one soon, it’s going to have trouble attracting referrals,” he says.

Most primary-care physicians have just one or two patients in the hospital at a time. A shortage of primary-care physicians means they face greater demand for office visits. Whatever revenue is gained from seeing those one or two patients at the hospital is often less than what the physician could make by staying in the office and seeing several more patients there. These cost and time pressures also affect specialists, Cawley says.

“The economics of practice and the shortages in many specialties are pushing specialists to either be in the office doing consults or to be performing procedures,” he says.

But it’s not just money and a shortage of physicians fueling the rise of the hospitalist. “Frankly, patients and their families don’t want to wait until the next day anymore to talk to a physician,” Cawley says. “These days, they want their physicians there by the bedside and they want them there now.”


Quality rules

Besides helping physicians establish more controllable work hours, hospitalists give hospitals new tools to improve quality measures, patient satisfaction, and other goals.

“If you tell four hospitalists about a new quality target then you affect 48 hospital patients right away,” says Haiwen Ma, an internist who directs the hospitalist program at South Nassau Communities Hospital in Oceanside, N.Y. “You’d have to tell 25, maybe 48, primary-care physicians in the community those same things to affect the same number of patients.”

Ma, who supervises a small-but-growing hospitalist department for the Long Island hospital, says hospitalists can add value to the institution’s mission. An effective hospitalist service doesn’t just do rounds and record charges; it helps other staff with programs that improve quality, safety, and patient satisfaction, she says.

“Joint Commission standards are being updated and other programs are always changing but since hospital work is not where the office physician’s expertise is, it is hard for them to remember all of the details as these new standards come along,” she says.

Patients vote yes

Ma says the biggest indicator of a hospitalist program’s success is what primary-care physicians hear from patients.

“Believe me, if there’s anything the patient feels wasn’t good service in the hospital, it will get back to the primary-care physician, which means it will get back to the hospitalist, and it happens very quickly,” she says.

Indeed, the service quality of hospitalists impressed one recent patient of Dr. Ma’s: a 62-year-old Long Island woman who spent a few days at South Nassau after getting a new cardiac stent inserted.

“I had no complaints about it because I saw the surgeon afterwards and then Dr. Ma and her staff were coming by to see me several times and talk to my family at the hospital,” she says. “It was good to know the doctor wasn’t very far away.”

Hospitalists typically provide 24-hour coverage. While some services use an on-call schedule to handle late nights and weekends, most provide round-the-clock coverage so a hospitalist is always in the house.

Office revenue

Is the inpatient revenue you might give up along with your hospital practice greater or less than the outpatient evaluation and management revenue you gain by staying at the office? Do an analysis, suggests Donna K. Knapp, administrator of Sierra Hospitalists, LLC, a 17-physician service owned by a group of specialists in Reno, Nev.

“Figure in your own time, of course, but also think about the extra revenue you could get by staying in the office to supervise ancillary diagnostic testing or a midlevel provider who can bill incident-to your services,” Knapp says. “You’ll take a 15 percent hit from payers like Medicare on anything the midlevel does while you’re doing rounds; she may not be able to do some things at all when you’re out of the office.”

For example, Medicare reimbursement rules require a physician on site when performing pulmonary function testing to evaluate patients who receive a bronchodilator. The service could be reimbursed as a CPT 94060, Bronchospasm responsiveness evaluation. If the internist is out on rounds, that means forgoing the $60 Medicare reimbursement paid on average for that service in 2008. More time in the office could help support hiring a midlevel provider or offering a profitable ancillary service, Knapp says.

In addition to figuring the hypothetical lost revenue for leaving the office, make a guestimate of your hourly rate. It can help you judge whether you break even on your hospital time. One method is to divide your annual compensation by 2000 hours. You can get to that figure by tallying up the medical revenue produced by your office services and dividing by the number of hours you spend in the office each year. Then multiply that hourly amount by the hours you spent doing rounds, plus getting to and from the hospital, standing around waiting for a radiology report to be delivered at the hospital, and so on.

Or try using national averages to get a general figure, such as the $177,059 median annual compensation for internal medicine physicians reported in a 2007 Medical Group Management Association (MGMA) survey. Using the MGMA numbers as an example, each hour on the hospital floor costs you $88.53, assuming you work 2,000 hours a year.

Let’s say the hospital is across the street and you spend just 30 minutes a day on hospital rounds. No big deal? Assuming you earned the MGMA salary, you’re still looking at more than $10,000 worth of time (based on a 48-week work year) to make those rounds. That doesn’t include the time you spent answering the nighttime and weekend calls about those patients. And if you drive, don’t forget to charge yourself $1.48 for every minute you spent in traffic getting back and forth to the hospital, plus fuel costs.

A look at your annual hospital census will tell you what your inpatient revenues are but don’t forget to also look at what it costs you to bill and collect those charges. If hospital patients are 10 percent of your practice, then subtract 10 percent of your overall billing and collection costs from that revenue stream.


The result may be what the hospital-owned multispecialty Marshfield (Wisc.) Clinic discovered after it started using hospitalists.

“The production on the outpatient side improved because people were there and they also were not taking comp days after a night call shift and you weren’t having to block time out of their schedules for morning and evening rounds,” says Roderick Koehler, an internist who leads the clinic’s 24 hospitalists at St. Joseph’s Hospital in Marshfield.

Deliverables that count

The biggest fear that primary-care physicians had when hospitalists were first introduced is the same one present today: losing track of patients. Communication is king when it comes to running a successful hospitalist service, says Koehler.

At Marshfield, expectations for communications are built into the hospitalists’ compensation structure. They include:

  • Submitting complete audit discharge summaries within 24 hours of discharge

  • Ensuring the primary-care physician has been contacted when a patient is admitted

  • Getting favorable results on patient satisfaction surveys

  • Making sure that the majority of discharged patients are called afterwards

  • Hitting length-of-stay goals and quality indicators

South Nassau’s Ma says it’s important that the hospital service call the primary-care physician within 24 hours of the patient’s admission to the hospital. “The primary-care physician can tell us about the patient’s background and what’s taken place in the past,” she says.

Ma says it is also is a standard for her hospitalists to contact primary-care physicians whenever a patient has a major change in health status, undergoes a major procedure or test, or is discharged. Her staff also must send a complete written discharge summary within 24 hours.

But don’t make assumptions about communication before signing up with a hospitalist service, Cawley says. He recommends meeting with the director of the service, asking about each of its physician’s backgrounds and experience, and getting all expectations about communications in writing.

“Look at what you receive and when you receive it,” Cawley says. “A discharge summary that is very brief or has a lot of missing information in it would give me the sense that hospitalist didn’t pay a lot of attention to detail.”

Always let the director of the hospitalist program know when you are unhappy with the communications between the hospitalist and your practice, he recommends.

Two-way street

Communication works both ways, says Koehler. You’ll want to respond promptly when the hospitalist calls with questions, he says.

“Maybe you can help them understand a family dynamic or something else where you have the information because you know the patient,” he says.

Anderson says he and the other two physicians in his Newport News practice make sure to never send a patient to the hospital who doesn’t need to go to the hospital. Nothing will erode the relationship faster than the impression of dumping on the hospitalists, he says.

He also recommends reading written discharge summaries carefully because they will often contain more information than the hospitalist was able to convey in the post-discharge phone call.

Anderson says the system works if doctors - hospitalists and office-based physicians - make it work.

“There’s been no downside for me in using a hospitalist,” Anderson says. “I tell my patients who are skeptical about it that these guys are better because they do hospital care all the time, full-time, and the patient is going to get better care because of it.”

Bob Redling, MS, has written on practice management topics for more than 10 years. He has been practice management editor for Physicians Practice, Web content editor and senior writer for the Medical Group Management Association, and a speechwriter for the American Academy of Family Physicians. He can be reached at editor@physicianspractice.com.

This article originally appeared in the September 2008 issue of Physicians Practice.