Historically, hospitals have experienced difficulties managing physicians. But with the new healthcare reform initiatives, employing physicians is seen as critical to reaping new revenue streams tied to greater coordination of healthcare. As a result, health systems have been acquiring physician groups at an accelerating pace.

In the article linked below, “Making Physicians Pay Off,” Beth Kutscher of Modern Healthcare does a great job explaining the cost-benefit factors that hospitals are reviewing when trying to balance the “current costs” versus “future benefits” of employing physicians.

Here’s a key takeaway offered in the article: “Given a median loss of $176,463 for employing a doctor, some analysts are predicting a pullback on physician buys this year.”

However, many hospital executives continue to say that these acquisitions are critical because their current balance sheet numbers don’t reflect the future reality: capitalizing on new revenue opportunities will require much greater coordination of healthcare for patient populations, and having doctors and hospitals tightly integrated is essential in that regard.

Dr. Alan Kaplan, president and CEO of a 12-hospital system based in Iowa, is quoted in the article, saying, “You have to bring them in—and then you have to bring them in as efficiently as you can. It’s really a strategic asset that requires investment.”

To learn more about the pros and cons of acquiring physician groups, you can read the article in its entirety by going to this link:

Author: Jim Wiederhold

Jim believes his 39 years of experience--particularly his more than 26 years in healthcare--has prepared him well for what he does. His wealth of experience spans key areas, including finance, operations, management, leadership, sales and sales management, corporate, contingency, contractual and retained recruiting, outplacement and transition work and executive coaching.