Hospital Cancels Surgeries After Firing Anesthesiology Group

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8/31/2021 7:42 AM
Advocate Sherman Hospital in Elgin is putting a hold on elective surgeries for almost three weeks due to a lack of anesthesia providers.
In a statement, parent company Advocate Aurora Health didn't address the reason for the shortage in anesthesia providers, but did say they "will continue to provide care for urgent and emergent situations, and it is critical that patients seek care when needed."
Dr. Sanjay Sutaria said his company, United Anesthesia Associates in Elgin, had been working with Sherman Hospital for 30 years to provide anesthesia services. He said they had been negotiating with Advocate for more than a year and half on a contract before the hospital chain decided to go with another provider.
www.dailyherald.com

Advocate Sherman Hospital rescheduling elective surgeries due to a lack of anesthesia providers

Advocate Sherman Hospital in Elgin is putting a hold on elective surgeries for almost three weeks due to a lack of anesthesia providers.
www.dailyherald.com www.dailyherald.com
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Mike MacKinnon
Is there a shortage? Or is there a shortage of anesthesia providers who are actually perfroming the anestheisa due to the model of anesthesia care they are using?

Instead of stopping elective procedures have the CRNAs and the MDs do their own cases. It makes no sense to have one fully trained anesthesia provider 'supervise' another and patients wouldnt have to wait for their surgeries.
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smh
 
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Big hospital systems suck. Everyone being employed by the hospital sucks. Although, I guess if you are salaried employed, it doesn't matter if there is no anesthesia.

So thankful I'm in PP and that we are part owners in a seperate asc and inpatient hospital. There's no bull****. We pay our nurses, techs and staff more. Admins (the few that exist in our facilities) compensation is tied to performance metrics. It's a win for everyone.
 
GassYous said:
smh
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If I cannot trust my nurses, there are plenty that I don’t, regardless employed or hospital owned. I’d do my own cases, any day of the week. Especially days that ends in “day”.

Mike, don’t pin the anesthesiologists as the bad guys.
 
I have a family member in healthcare from Elgin. I’m sure it’s an awful payor mix and they wanted a hefty subsidy. And there are better jobs nearby. The bigger issue is that advocate is one of the major hospital systems (along with northwestern) that controls probably at least half of the hospitals in the area, the majority of which have private groups and many of which are mostly solo MD. If they repeated this with their other sites they could very quickly turn some great jobs to crap.
 
way to do this at a time when there is a big anesthesia shortage. Goes to show hospital admin can often be tone deaf. The hospital needs to be exposed as the sheet show that it is so that patients are at least aware..
 
secretasianman said:
way to do this at a time when there is a big anesthesia shortage. Goes to show hospital admin can often be tone deaf. The hospital needs to be exposed as the sheet show that it is so that patients are at least aware..
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Hospital points at the group…. Greedy anestheia group wants more money.

Group points at the hospital… not enough stipend.

AMC comes in. “We can do it without a stipend….”

Story as old as time.
 
IMGASMD said:
Hospital points at the group…. Greedy anestheia group wants more money.

Group points at the hospital… not enough stipend.

AMC comes in. “We can do it without a stipend….”

Story as old as time.
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rinse and repeat. Cycle of suck continues.
 
I mean depending on the size of the group and call requirements, hospital subsidized stipends could be like anywhere between 3-6 million a year.
 
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DrOwnage said:
I mean depending on the size of the group and call requirements, hospital subsidized stipends could be like anywhere between 3-6 million a year.
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What does the size of the group have anything to do with it? I’ve never been involved with contract negotiations but wouldn’t a hospital throw some stipend money at the anesthesia group for their coverage and leave it up to the group to divide it up however they see fit?
 
Apparently you dont even need an IL license to apply. 2 week credentialing.
I know someone who called and got that info, their offer was really nothing special and when my friend countered with 30 percent more, they said No thanks.. I imagine they will have problems for some time to come.
If you are in a bind like that, you dont balk at ANY offer.
 
Aheadbyacentury said:
Apparently you dont even need an IL license to apply. 2 week credentialing.
I know someone who called and got that info, their offer was really nothing special and when my friend countered with 30 percent more, they said No thanks.. I imagine they will have problems for some time to come.
If you are in a bind like that, you dont balk at ANY offer.
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what were they offering? 1500 a day? 2000 a day? 2500 a day?
 
Urzuz said:
What does the size of the group have anything to do with it? I’ve never been involved with contract negotiations but wouldn’t a hospital throw some stipend money at the anesthesia group for their coverage and leave it up to the group to divide it up however they see fit?
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Just saying depending on call frequency, other sites besides the hospital proper. Bigger call pool = bigger group usually. Pointing out its not thousands. 4-5 call slots is at least 5k a day, more on weekends, so at least 150k a month probably.
 
DrOwnage said:
Just saying depending on call frequency, other sites besides the hospital proper. Bigger call pool = bigger group usually. Pointing out its not thousands. 4-5 call slots is at least 5k a day, more on weekends, so at least 150k a month probably.
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4-5 ORs can generate that much in facility fees in a day
 
DrOwnage said:
Just saying depending on call frequency, other sites besides the hospital proper. Bigger call pool = bigger group usually. Pointing out its not thousands. 4-5 call slots is at least 5k a day, more on weekends, so at least 150k a month probably.
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When you consider how much they pay their droves of admins, nurses, etc, the cost of physicians is probably just a drop in the bucket. Now they have to enter the free market of locums and pay 2x or 3x before. It's okay whoever made this decision probably will get a 7 figure severance and move on to a better paying position elsewhere.
 
DrOwnage said:
I mean depending on the size of the group and call requirements, hospital subsidized stipends could be like anywhere between 3-6 million a year.
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Yep. Salaries have gone up Probably 20-30% in the last decade. Yet Medicare rates have been stagnant.

Practices heavy in government insurance almost have to operate at a deficit. Administrators thinking otherwise are delusional. It does put us at a disadvantage in negotiations though. That hospital money comes with many strings attached.
 
ChiDO said:
Big hospital systems suck. Everyone being employed by the hospital sucks. Although, I guess if you are salaried employed, it doesn't matter if there is no anesthesia.

So thankful I'm in PP and that we are part owners in a seperate asc and inpatient hospital. There's no bull****. We pay our nurses, techs and staff more. Admins (the few that exist in our facilities) compensation is tied to performance metrics. It's a win for everyone.
Click to expand...
where do you live, how much do your partners make and are you hiring?
 
Midwest Anesthesia Partners is the parent group over the ousted Anesthesia group. They are a big player in the Chicago area. They are physicians, but have a reputation for being good businessmen.

I wonder if the new group was counting on anesthesiologists jumping ship to the new group so the ousted anesthesiologists would not have to sell their homes and move for a new job. So far the old group seems to be holding strong. Probably helps that their parent group covers so many locations not too far away.
 
Impromptu said:
Midwest Anesthesia Partners is the parent group over the ousted Anesthesia group. They are a big player in the Chicago area. They are physicians, but have a reputation for being good businessmen.

I wonder if the new group was counting on anesthesiologists jumping ship to the new group so the ousted anesthesiologists would not have to sell their homes and move for a new job. So far the old group seems to be holding strong. Probably helps that their parent group covers so many locations not too far away.
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It is also possible that they have contract language that prevents them from jumping ship to cover the same facility under a different entity for x period of time or other non-compete stuff.
 
Guillemot said:
It is also possible that they have contract language that prevents them from jumping ship to cover the same facility under a different entity for x period of time or other non-compete stuff.
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most private practices are going to have their own non compete language that makes them tough to replace similar to AMCs. In my experience not quite as restrictive and a private group likely much more amenable to letting someone buy you out of it.
 
Impromptu said:
Midwest Anesthesia Partners is the parent group over the ousted Anesthesia group. They are a big player in the Chicago area. They are physicians, but have a reputation for being good businessmen.

I wonder if the new group was counting on anesthesiologists jumping ship to the new group so the ousted anesthesiologists would not have to sell their homes and move for a new job. So far the old group seems to be holding strong. Probably helps that their parent group covers so many locations not too far away.
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This is the “plan” of almost all the “new” groups, that take over a contract. Hope that 2/3-3/4 of the current staff sticks around, and work ‘em into the ground or get a few locums, until you can find a few other folks.

I don’t have anything to back it up, but I would bet that 75% plus of these group changes at any hospital (awarding the contract to a different group), have little to do with quality, and EVERYTHING to do with saving a few $$ and polishing up some CEO’s resume (“Look!!! I cut costs!!!).

They’ve been playing this “game” for 10-15 years, now, every time a new CEO shows up (3-5 year cycle at most “for profit” corporate hospitals these days, as they work their way up the corporate ladder to bigger/nicer facilities). There’s only so many ways to polish a turd, and when you have a hospital with a crappy payer mix, there’s GOT to be a stipend. These CEO’s can’t keep cutting the stipend, contract cycle after contract cycle.

The hospital and the surgeons can make 60-80% of private pay $$ on Medicare/Medicaid cases/facility fees, but when Anesthesiologists can only get 25–33% of private pay $$ ($18-$24 a point, vs. $60-$100 a point for private pay), well, that doesn’t even cover the cost of a $125 an hour CRNA, these days, especially when your “utilization” (time spent in OR) is only 50-75%. You can’t generate money waiting on slow turnovers, late surgeon arrivals, poor scheduling, and “pay per point” (Medicare/Medicaid) that’s barely gone up in 20 years plus....
 
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I think the anesthesiologists who formerly worked at Sherman Hospital will be alright. There are pros and cons of being in a big group compared to a little group. In big groups there are always a few doctors near retirement. If they lose one contract they can absorb those displaced physicians into their other hospitals and just ease up on perennial recruiting for a half year while some of the older physicians retire. It gives them more leverage in bargaining, even with a behemoth like Advocate Aurora.

Other perks of being in a bigger group are that you can actually take a sick day and the hospital doesn't implode.
 
Impromptu said:
I think the anesthesiologists who formerly worked at Sherman Hospital will be alright. There are pros and cons of being in a big group compared to a little group. In big groups there are always a few doctors near retirement. If they lose one contract they can absorb those displaced physicians into their other hospitals and just ease up on perennial recruiting for a half year while some of the older physicians retire. It gives them more leverage in bargaining, even with a behemoth like Advocate Aurora.

Other perks of being in a bigger group are that you can actually take a sick day and the hospital doesn't implode.
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However it sucks if they have a lot of contracts with the same health system and this is the first domino. I would be nervous.
 
pjl said:
However it sucks if they have a lot of contracts with the same health system and this is the first domino. I would be nervous.
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It depends. If you have 20-25 years behind you. Not so much. If you are starting out, this IS very concerning.
 
Aheadbyacentury said:
It depends. If you have 20-25 years behind you. Not so much. If you are starting out, this IS very concerning.
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I meant for the group in general. Advocate is huge, with something like 25 hospitals.
Not sure how many of that Anesthesia groups sites are with them, but that would be a lot of people to shuffle.
 
pjl said:
I meant for the group in general. Advocate is huge, with something like 25 hospitals.
Not sure how many of that Anesthesia groups sites are with them, but that would be a lot of people to shuffle.
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Advocate can't even make this Sherman hospital work. Do you think it will change contracts with other hospitals?
 
narcotics999 said:
Advocate can't even make this Sherman hospital work. Do you think it will change contracts with other hospitals?
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Advocate hospitals are quite heterogeneous in terms of geography, case mix, payor mix, anesthesia groups, etc. Is it possible the midwest anesthesia partners leadership isn't sad to lose this site, and only would have stayed for a big subsidy? It would be interesting if this was less a group losing a contract to an AMC and more a toxic asset being cut, as unlikely as that might be.
 
ambiturner said:
Advocate hospitals are quite heterogeneous in terms of geography, case mix, payor mix, anesthesia groups, etc. Is it possible the midwest anesthesia partners leadership isn't sad to lose this site, and only would have stayed for a big subsidy? It would be interesting if this was less a group losing a contract to an AMC and more a toxic asset being cut, as unlikely as that might be.
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That sounds like a nicer spin. I’m gonna assume that’s the real one, and that the AMC will screw it up, leaving a bad taste in Advocates mouth and protecting another health system from AMC takeovers.

Yup, I like this view.
 
narcotics999 said:
Advocate can't even make this Sherman hospital work. Do you think it will change contracts with other hospitals?
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I suspect it all depends how this works out. If Advocate just shifts business for a month, it isn’t really lost to them and they still get the profit. Will have to watch over the next few months/years to see the final outcome.
 
Do these ceos not understand the risk they take by removing a functional group at is getting all cases done? Do they make a calculation that x amount of cases will be
 
C suite are out of touch.

Prior ceo at our institute was in the ORs twice daily talking with anesthesia and surgeons. Hospital was booming.

New ceo, who actually just announced he is stepping down and turn the place into a **** show. Hospital anesthesia contract is expired. 75% of or staff are travelers now and they cut all elective OR hours down to 3pm, so last cases can start around 12-1ish.

Lota of surgeons taking business elsewhere.
 
ChiDO said:
C suite are out of touch.

Prior ceo at our institute was in the ORs twice daily talking with anesthesia and surgeons. Hospital was booming.

New ceo, who actually just announced he is stepping down and turn the place into a **** show. Hospital anesthesia contract is expired. 75% of or staff are travelers now and they cut all elective OR hours down to 3pm, so last cases can start around 12-1ish.

Lota of surgeons taking business elsewhere.
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The next time I see the ceo's face in real life and not some dumass poster will be the first
 
At our community hospital entrance hallway, they just put up large portrait pictures of the CEO, head of board of director, and some other "big shot." Why they think anyone cares to see their mugs I don't know... Meanwhile another big hospital about 20 minutes away has large posters\portraits of their docs lining the hallways describing what they do. Stark difference in priority there.
 
As a community anesthesiologist, I'm quite aware of the Advocate Sherman issue. My sources are the ones affected. They'll be alright.

Basically, Advocate Aurora wanted more for less with a not great payor mix. So they decided to backstab the existing group by stalling negotiations while finding TeamHealth. TeamHealth is backed by a private equity firm with deep pockets. Their offers are substantial to get people in the door so they can fulfill their end of the contract. I called them for a job inquiry and besides the somewhat nebulous conversation, they must be desperate to replace 12 physicians and 11 CRNAs.

But eventually TeamHealth won't accept hemorrhaging money and want to harvest those losses in a future contract. What's Sherman going to do? Shut the ORs down again? TeamHealth operates how like Uber and Lyft worked in the early 2010s. Get into the market and own it with cheaper prices sustained by big time investors playing around with money, and then raise the rates/service fee request eventually. Gotta harvest at some point. Even if you work for TeamHealth, it might just be a one contract period job and then that contract folds.

Nearby admins know the consequences of turning away a long standing group which means your money maker grinds to a halt. It would be stupid to happen elsewhere in Chicago area but I can see some other cowboy admin trying to make a name for him/herself.
 
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