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Doctor-Hiring Rush is On

Karen Minich-Pourshadi, for HealthLeaders Media, April 2, 2013

Under pay for performance, finance leaders could measure the financial success of a physician-hospital partnership in a relatively simple equation: how much was spent to onboard a physician, plus salary and benefits, plus overhead minus the amount of revenue per patient that the physician generated. Though it could take three to five years for newly employed physicians to generate revenue that exceeded the cost of hiring them, it was nonetheless measurable. Under health reform, with the focus on population health and the shift away from volume to quality outcomes, discerning the financial value of a new hire can be elusive. While many payers are not yet reimbursing for better-quality care, physicians are beginning to be tracked by quality and patient satisfaction metrics that are not yet tied to all payer contracts and can add to the challenge when calculating ROI.

"When it comes to ROI for physicians you have to decide what the successful partnership is going to mean for the organization. Is it the financial aspect of a practice? Is it clinically how well they are doing based on metrics? We look at patient satisfaction and physician satisfaction, and we also compare physicians against one another," says Manas. She adds, however, that a strong business case is an essential that is sometimes overlooked by hospitals where the marketplace is aflame with zeal to employ.

"There has to be a business case. You need to look at the financial metrics of employing versus partnering, and then you also need to clearly define what you will use to gauge the measure of success for this pairing," she says. "You also need to consider not only the dollar impact but the political one, too. If you're hiring a direct competitor for a practice that's been supporting your system in the past, you could alienate that practice. You need to be able to fully articulate the reasons why you are employing versus partnering or joint venturing, and how employment will better serve your community."

Establishing alignment plans

Collaboration, communication, and metrics: These three words need to be included in all discussions with potential employees and in employment agreements. Creating a strong hospital-physician alignment entails building upon shared objectives and goals, and knowing how these are being measured is a cornerstone to a mutually successful relationship, says Browne.

"Our organization has a spectrum of employment arrangements," says Browne. "Growth for us is happening in the specialist arena in terms of physicians seeking employment and where we're seeking physician to employ."

Browne took on the role of systemwide CMO in October 2012 with the assigned task of building relationships with doctors and providing leadership in the areas of quality, clinical effectiveness, system integration, informatics, and the development of service lines. He was chosen, in part for his background as a principal with healthcare consulting firm Pershing Yoakley & Associates, which would give him a broader perspective of employment agreements from both an administrative and clinical perspective.

"At the end of the day I'm a physician, and I come back to that. There are a lot of employment models out there … and there are different tactics you need to consider to further the alignment strategy," he says. "First, you have to look at the differences in physicians from different generations … and we know we have to create agreements that are based on performance standards, not just productivity."

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4 comments on "Doctor-Hiring Rush is On"


Dr Bob (4/28/2013 at 7:49 PM)
"healthcare reform as the time that not only made improvements in the quality of patient care " Karen, with that one statement in the opening sentence I realized you are clueless re medical care, the determinants of health, and the intent of the "Affordable Care Act" Dr Bob

Paul Schwartz (4/3/2013 at 9:29 PM)
The current trend in employment opportunity for physicians, while unarguable, is certainly both disappointing, and worrisome. The pure employment model of healthcare is not what the average U.S citizen desires, or expects. Think Canada, think V.A. hospital, think Kaiser. Low production models that save money primarily by limiting access to services. Certainly some organizations such as the Mayo Clinic, and Cleveland Clinic have been very successful with an employment model and provide superb medical care, but these are definitely in the minority, and, are at their root, superb examples of private practice medicine expanded to offer large arrays of service, rather than a hospital organization seeking to capture market share. We have resisted this change, as a medium sized multispecialty group practice, but are certainly worried by the seeming ignorance of the federal government and it's inability to recognize and treat the real problems that exist in today's health care in the United States. I hope that at some point both the government, and the populace in general will begin to recognize the worth in having hard working, independent physicians, who care most for the health of their patients, and are willing to devote time and money towards research and exemplary health care, rather than encouraging an entire army of complacent, unmotivated physicians simply collecting a salary from the hospital behemoth that is controlling all of medicine in it's own best interest.

Greg Mercer, MSN (4/2/2013 at 7:18 PM)
Physicians had their time of power and prestige, and they gave it away for all the money thrown their way by all the insurance and Pharma conflicts of interest they have become quite addicted to as a group. The loss of credibility and presitige that has resulted has, at long last, beugn to seriously erode physician power, autonomy, and incomes. You reap what you sow, and power lasts only as long as you maintain it: take it for granted for an few generations and poof! It's gone.