Monday, June 4, 2012

The New Fault Line in American Medicine

The medical profession has always been marked by division: town versus gown, primary care versus specialty medicine, states versus national. But the real fault line today is not defined by specialty, geography, or teaching versus practice, but by size of practice.

Physicians in smaller practices, without regard to specialty or where they are located, are embattled and defensive—and therefore are more skeptical when someone tries to peddle the need for delivery system reform. This is a generalization, but my observation is that physicians in smaller practices see Accountable Care Organizations and Patient-Centered Medical Homes as a threat, and physicians in larger practices them more as an opportunity. Physicians in smaller practices prefer to keep fee-for-service, even as they complain that it doesn’t pay them fairly for their services, while physicians in larger practices (many of whom already are salaried or paid on a productivity + FFS model basis) are more likely to be willing to leave FFS behind.

There is evidence that physicians in smaller practices are also more likely to have a more anti-government, conservative political orientation than those in larger groups. The New York Times reported last year that "as more doctors move from business owner to shift worker, their historic alliance with the Republican Party is weakening from Maine as well as South Dakota, Arizona and Oregon, according to doctors’ advocates in those and other states."

There also may be some self-selection bias at work: physicians who choose to own or work in smaller practices may be more individualistic by nature and therefore less trusting of being "managed"—by government, by health plans, or even by other physicians—and therefore are more conservative in their political leanings and more adversarial towards government.

Of course, even if this generally is true, there are many exceptions: I know very liberal doctors in solo or small practices, and very conservative ones in very large practices.

Sometimes, the practice-size divide is mirrored in specialty society politics. I am told that ophthalmologists and dermatologists tend to be in smaller practices, and their national medical specialty societies tend to be more conservative on their approach to health care and delivery system reforms.

Interestingly, though, a 2009 report by the well-respected Center for Studying Health System Change did not find much variation in reported career satisfaction associated with practice size, with more than 75 percent of all physicians reporting that they were "very satisfied" or "somewhat satisfied" with their careers in all categories of practice size (solo, 3-5, 6-50, 51 plus, HMO, and institutional practice).

Physicians in smaller practices also tend to be older—and that may also be correlated with a more conservative view of government. Two years ago, I provocatively asked in a blog post "Is it too late for small practices?" citing an AMA survey that found that "75.5 percent of physicians are office-based (61.1 percent owner, 14.4 percent office-based employee), and that this percentage increases with age, from 68.9 percent for physicians under 40 to 81.2 percent for physicians over 54."

I concluded then, and still believe, that there is a future for smaller practices—but that they will need to adapt to be successful:

"I think that that the physician practices that do well in the future will be those that are able to demonstrate to buyers of health care that they are able to provide measurable "value" for the money being spent, defined as good or better outcomes at lower cost. With the right mix of supportive public policy and trusted advice and practical resources to help them succeed, I believe that the future for smaller practices may be much brighter than conventional wisdom suggests."

Here’s the problem, though: telling a physician in a smaller practice that they need to adapt is about as popular as a teetotaler preaching abstinence in an Irish bar! Plus, "adapting" or "practice transformation" usually sounds like someone else telling them to spend money they don’t have, to invest in something that they don’t believe in (ACOs, PCMHs), in the (futile?) hope that someone will pay them at least enough to cover their costs—so they at best end up breaking even for all of the effort. So what’s the point?

And I can’t disagree with them—so far, the return on investment for medical homes and some of the other new models being rolled out are marginal and uncertain at best, although for the first time the government is beginning to put some real money on the table for medical homes in its Comprehensive Primary Care Initiative.

But here’s the rub: "adapting" or "transforming" is risky, but what is the alternative? The movement to more integration and bigger sized enterprises has affected every other part of the American economy—how many locally-owned "Mom and Pop" restaurants or pharmacies are there in your neighborhood? And the small businesses that do survive have had to adapt.

There is a great, locally-owned book store in my neighborhood, Politics and Prose, that not only has survived the "big box" bookstores (even as a Borders less than a mile away went down with the rest of the chain), but is hanging on (so far) through the e-books onslaught. They have done it by great outreach to the community, by regularly hosting authors and poets for readings and discussion, and by helping you find any book you want, whether they carry it or not. Think of it as a Reader-Centered Literary Home! But they also have survived because they serve a small but prosperous niche market of readers (who still prefer real books).

The challenge for an advocacy organization like ACP is that we have members on both sides of the fault line. And no matter how effective our advocacy is for smaller practices (we’re always looking at proposed rules and laws from the standpoint of "How will they affect our members in smaller practices?" and "How can we help them succeed?"), we can’t turn back larger economic forces that have led just about every other cottage industry to either go out of business or find new strategies to adapt.

Today’s question: Do you agree that "small" versus "large" is the new fault line in American medicine, and if so, how can ACP navigate it effectively?


PCP said...

You as an advocacy organization will not get off that easily Bob.
To say now 20 yrs on that there are "larger forces at play" is rather escapist.
The issue here is not one of small vs big alone. It is more specifically about the issue of why is Gov't and private payer policy so skewed toward big.
It is an issue of "why are small private practices not being allowed to compete on an equal footing".

Regulation and increasing overhead favor larger practices due to their scalable business models.

The so called free market is not so free either, we have on one hand a price fixing bureaucracy called medicare (which the gov't is desperate to hold on to and fought very hard to keep as such) where will are not even allowed to balance bill and on the other hand we have ruthless insurance oligopolies that divide medicine at will via a payment system. To top it all off, we have the RUC sponsored by organised medicine doing an able job of dividing medicine all by itself.
We have as a result larger specialty practices and hospitals able to negotiate better term whereas smaller private practices are at the mercy of payers. There are even anti-trust laws against loosely affiliated co-ops practices or some such negotiating entity.

We have the completely ridiculous policy of Gov't reimbursing hospitals at greater rates for the same service rendered, FQHCs, CHCs, RHCs, IHCs etc at cost based reimbursement, often the need for their presence justified by a primary care void(which is itself created due to reimbursements at 1/3 or less of the CHC cost based rates)...............what laughable policy(or enlightened based on your perspective), to create a void, then fill it with a more expensive solution! Why the SGR on medicare B and not on Medicare A,C or D? In fact C(medicare advantage) even gets a subsidy over and above traditional medicare costs.
Every organization that has a strong effective lobby in DC gets its way. We are always on defense.
Physicians are hamstrung from offering a broad range of services by Stark laws etc. to say nothing of payer policy even when they can be cost competitive and the AHA has even successfully barred physician owned hospitals, whereas on the other hand local Hospitals are on a private practice buying spree, United healthcare and other private insurers are buying provider groups and even hospitals. Pharmacies freely sell alcohol and cigarettes. etc.

So argue all you want, that these are changes beyond our control, but the environment has incrementally been fostered this way while our advocates were asleep at the wheel allowing these double standards foisted on us by reminding us of our hippocratic oath and telling us we should be patient centered and that we ought not to think or act like business people or entrepreneurs.
Now that the environment has become so toxic, so lop sided that many of us are cratering we are being told by our so called advocates that there are larger forces at play. A sad joke really.

Lets have this debate openly and see what the american public thinks about all these double standards?

Arvind said...

Bob, you have finally started to see some of the light that I have been talking about for a long time. Here is where the ACP and other specialty organizations have gone wrong:
1) Involved mainly academics and physicians in large groups in leadership roles drowning out the voice of the small practice-owners.
2) Operated with the (faulty) bias that there is one way towards "reform", i.e. the ACA way.
3) Refused to adopt a free-market approach to reform in health care delivery/purchase.

In 2008, I as a solo practitioner, had showed the ACP (via CPI project) how innovation/adaptation/human ingenuity+IT works in the small practice environment. Yet, nothing tangible same out that project! The same year, I completed the NCQA process for medical home with an 85% score (I suppose it would be a level 3 now). But I found no use for it because nobody could promise me any monetary value for wasting my time on it.

So the ACP has failed those of us in small practice time & time again. Which is why I am not renewing my membership this year. So, if you don't want to lose more Fellows as members, you need to wake up and challenge yourself by ridding yourself of all your biases, and making protecting small practices the only priority. Large groups can protect themselves just fine, they really don't need the ACP.

And BTW, the free-market principle that your local book store uses, will work just fine for small practices too...just allow them to try by removing the shackles of price-fixing and CPT codes. You will see that very soon you will have solved the problem of survival of small practice, access to quality, high value care and the crumbling physician-patient relationship. All you need is the courage to try, Bob. Alas, no such thing exits within the ACP leadership. Time to wake up for me...the dream is over!

Jay Larson MD said...

While I am in Washington DC for Leadership Day tomorrow and Thursday, I had an opportunity to visit with 2 staff members of the Democratic Senate Finance committee staff for 2 hours today. This occurred because my state senator is the chairman of the Senate Finance committee. We covered all sorts of topics including ACP issues for Leadership day. When talking about how they interact with medical societies, they mentioned that it is common for medical societies to throw some other medical society under the bus. Why are you paying that doctor more money? I am just as important, if not more important. Not very professional to say the least. But if you look at medical education process what do you expect…you are competing with other college students to get into medical school, then you are competing with other medical students to get into residency, then after residency you are competing with other physicians for the health care dollar. But I digress.

I have worked on both sides of the small vs large fault line. About a decade ago I went to work for our local hospital. It became rapidly apparent that the system could care less about patients, but only about patient’s financial ability to feed the machine. After 3 years, I went back into private practice with another internist and have not looked back since. We are working towards the 2011 NCQA standards to be a medical home, not because we are banking on increased rewards but because it would make us better and help us deliver better care. That’s what it should always be about. It should not be about us vs them, but how can we as a profession do a better job. I didn’t make the decision to go into a small group because I wanted to be independent (the hassles of running a small practice is very time consuming), I did it because I know in a small practice I can provide better and more personal health care to my patients at a lower cost. I don’t have a machine to feed.

Yul Ejnes, MD, MACP said...

"Small vs. large" implies that the small will stay small and therefore suffer. I don't think that has to be the case. In my March guest column in ACP Internist ( I described how my practice went from a two person practice to a larger, still completely physician-owned practice that is able to "compete on a equal footing" with the hospital-owned practices and in some cases outdo them.

However, in order for us to get to where we are, we had to make some sacrifices, accept some changes, and be willing to work very closely with other physicians. We were not handed the keys to our success nor were we spoon-fed the formula to get there. We were inspired and helped by resources from organized medicine: the state medical society and ACP, most notably ACP's support of the PCMH, which has helped us to not only improve our care but to increase our income significantly.

In 1995 we decided to control our own destiny rather than waste our time whining about how others were controlling it. Those opportunities exist for small practices today, if they are willing to do what it takes and have "the courage to try."

ryanjo said...

I find it ironic that Dr. Ejnes "saved" his own small practice by joining 89 other physicians! So the lesson here is stop "whining", join a big corporation so you can employ lots of physician extenders, and be happy. Sounds like the same tune as that infamous Annals article authored by White House insiders in 2010. The ACP leadership and the government reading from the same playbook -- who suspected...

The almost 50% of us who still practice in small practices (5 or fewer) reject the consolidation model. Go ahead and cast your lot with the insurers and CMS. Always the best to take a lead from these paragons of efficiency and patient advocacy.

Jay Larson MD said...

After reading Yul's comment, another fault line just formed in my mind....Rural vs Urban. In urban areas choice is more abundant. In a one hospital town with only a few subspecialities represented and the nearest next city is 70-100 miles away, choice is a different matter and hence decisions are different. In this era of High Value Cost Conscious Care, in my town, that is a small practice.

Steve Lucas said...

I have to wonder if a certain amount of self selection is not taking place in the leadership positions of the various medical societies. Doctors from large or corporate practices, having the support staff and financial resources, are better able to participate and rise to positions of importance in these societies.

The small private practice doctor, even with a couple of partners, is unable to financially take the time to pursue a leadership position. The result is a bias towards the corporate practice.

Many years ago the WSJ highlighted a doctor who moved to a rural area and opened a cash only practice. The consistent criticism from other doctors was he did not have a staff and thus was not upholding some sort of doctor rule that he was an important person. These doctors completely over looked his full schedule and the fact he was the highest income earner in the county.

Today there is a large debate about the yearly physical. There is no evidence based support for this, but yet many in leadership positions in the medical community feel this is necessary. A comment on another blog highlighted how they felt their once a year contact and counseling would be a life changing event. I find this a questionable outcome, but those in medicine have their bias.

What this does do is provide an opening to sell more services, as outlined by a number of hospital marketing people. When you are paid on a per contact basis and you have a large number of doctors, you want those people coming in for financial reasons. In a community with a large hospital that drives standards, this means every 90 days.

Large v. small, corporate v. private both deal with choices made by the doctors in the practices. I have learned that doctors speak in code. Sometimes when a doctor form a large or corporate practices speaks of giving something up, that thing is patient contact. The numbers just do not support those personal interactions available in the small practice.

Steve Lucas

Arvind said...

Dr. Ejnes is obviously one of the reasons the ACP has been so ineffective in its advocacy for small practices. Clearly, he has abandoned the concept of physician-patient relationship (something I hear at least 10 times a day from my patients) in favor of an industrial model of health care. For those of us that believe in health care being a personal relationship between a patient and his/her physician, this concept of consolidation and gimmickry does not feel like a better option. I agree this might be the only viable option financially in the era of PPACA, ACO, etc. but we would rather try the free market approach. Time will tell which one will thrive.

Yul Ejnes, MD, MACP said...

Some of the reactions to my post intrigue me, but do not surprise me. I did not “join 89 other physicians,” as “ryanjo” suggests. It’s a very compelling comment, but it's also hyperbolic and incorrect. Over fifteen years ago, I merged my practice with five others to create a 20-member physician-owned group that has grown to about 90 physicians.

For those of you who wave free-market flag on this blog at every opportunity, what my partners and I did is as entrepreneurial as it gets. We dug into our own pockets or borrowed money from the bank to get the legal and accounting help to build this practice – no handouts from (or ownership stake to) government, hospitals, insurers, or corporations. We took great risk in doing this on our own and that risk appears to be paying off after several years. Like many contributors to this blog, we don’t think that medical practice should be run by the government, the insurers, the hospitals, or the venture capitalists. So we took matters into our own hands and in our neck of the woods, medical practice is still run by physicians. Just because this model of private, physician-owned practice doesn’t conform to one’s prejudices and politics doesn’t make it any less valid.

As to the comments on the patient-physician relationship, (the patient comes first, “Arvind,”) that relationship can thrive or suffer regardless of practice size. My partners and I practice the same “small practice” personalized medicine as we did prior to our merging our groups. On the other hand, I’ve seen small practices that would put Toyota to shame in terms of assembly-line mechanics – short visits, one problem per visit limits, visits to get simple prescription refills, patients never asked to undress, and daily patient counts that seem unbelievable. Rather than mourn the devaluation of that very important relationship, those physicians boast of their work ethic, productivity, income, and efficiency. Let’s not delude ourselves into thinking that the degree of personal attention to patients is inversely proportional to practice size.

To Steve Lucas’ point, every day out of the office to attend meetings, Leadership Day, etc. costs me several hundred dollars out of my own pocket, since my partners don’t cover my share of the overhead for those days and there is no revenue generated when I’m away. That was the case prior to forming my current group and it remains the case today. And there are other leaders in professional societies who face similar challenges and make similar sacrifices – it’s a matter of priorities and personal choice. Without question, there is pressure on physicians in private practice who want to serve their profession by participating in their societies, but it is not necessarily a function of practice size.

The model that we adopted in 1995 is certainly not for everyone. It is not for the risk-averse. One needs to be able to work with others and clearly, not everyone is capable of doing that. Some localities’ physician practices and health systems may be organized in ways where this type of collaboration is not possible, as Jay Larson noted.

And, as I pointed out in my column, there are other less integrated models, such as IPA’s, that may better meet the needs of small practices while helping them to survive in the changing environment. One of my medical school classmates (and fellow resident) did the unthinkable in 1988 – when he finished residency he started a solo practice. He’s still a solo physician and wonders why today’s residents don’t do the same thing that he did. A major reason that he’s still in business and happy is that he joined the local IPA and has access to better contracts, EHR support, and lower cost practice support than he could get on his own. But he’s the same sole proprietorship that he was in 1988.

I look forward to my colleagues’ constructive comments and questions.

Harrison said...

I am in a much larger IPA than 90 physicians. I joined a group that was already part of the IPA, and the IPA was already pretty big when they joined. It is a risk. The IPA's take money up front and then give it back later, and offer some things that seem relatively intangible on paper.
But the support is tremendous. There still is a great deal of control. We are a group of 3 partners and one employed physician (our employee), and we can choose to back out of the IPA if we want to.
However if we did so at this point it would be financially devastating.

There is a romantic notion of the doctor offering fee for service medicine to patients with the patients paying and the doctor offering services.
This notion has never really existed and physicians would not want it if it did.
If we only get paid for services that we offer then we are going to be collecting money from people who mostly are sick and financially impaired by their illness. Yes, they may be grateful. But their resources are depleted.
Insurance allowed doctors to collect money from an entity that had resources. People paid when they could afford it. And then because they had paid they felt entitled to spend it -- often in excess of what they paid.

Medicare simply federalized that.
And it did so pretty efficiently with the profit motive taken out of the equation.

There was a short time when doctors could charge Medicare a fee that was largely unquestioned. That ended pretty early on.

With or without the ACA, doctors are going to have payment schemes that move away from fee for service and that put a value on communication with other doctors and efficiency and preventive services.
Little by little there will be a move to a higher value for primary care.
And if young physicians don't choose to move into those roles then mid level provides like NP's and PA's will become our colleagues and our health care providers.

The IPA's are potentially very helpful organizations.
Physicians in these organizations will have a clear advantage competitively going forward.

I can understand the push back and the feeling that this is selling out.
But I also think that the push back is driven by a sense of nostalgia for a practice model that never really existed, and that probably would be loaded with flaws for physicians if it did exist.


Doug Duffee said...

As an Internist who has practiced both in a Florida 100+ physician group and (currently) as a Colorado solo practioner (sharing call with 3 other solo practioners)I have seen first hand how both systems work. I have never worked without an emr and have my current solo practice electronically up to the minute. I do not think that there needs to be a philosophical or practical exclusion between a large or small practice. They both serve roles that particular patients need/want. Building comprehensive medical community systems of care requires flexibility, innovation and cooperation. It is always tempting to see things as more easily solved by placing a monolithic template on the solution. I am more than willing to link arms administratively with whatever system is needed without sacrificing independence. Once the proprietary and walled nature of our electronic systems give way to smooth intercommunication, this will be much easier. Once payers come up with quality targets that are uniform and to which we can consistently engineer our practice toward, the size of the practice should not matter. The market and patient preference will then answer the question not a de facto decree.

Arvind said...

What a classic defensive position from Dr. Ejnes. I don't need to be reminded that the patient comes first. My video is perhaps still on the ACP/CPII web site where my patient pronounces that he would drive 50 miles to get care from me. So, the real delusion is on Dr. Ejnes' part ironically. Somehow, he thinks he can come out ahead by throwing some gimmicky stats around. Contrary to his argument, it takes courage to stay in a small practice; those that are risk-averse are the ones that end up consolidating - trying the size versus size concept.

I finally am beginning to understand (via Dr. Ejnes' writings) why the ACP has been pushed in the direction it has been over the past several years. it certainly helps reinforce my decision to move away from the ACP - hoping to return some day when the ideology has changed for the better.