Independent PP groups can provide a better value than an AMC

[Stank811]

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http://monitor.pubs.asahq.org/article.aspx?articleid=2525789

It is not difficult for independent PP groups to compete with AMCs. Most of the selling points of AMCs to hospital administrators can easily be replicated at a fraction of the cost to your group. Well written article in this months Monitor that outlines the basics outline all independent groups should be following if they desire to remain independent.

 

[Noyac]

What a breath of fresh air.
I view this corporate takeover of anesthesia practices as no better than the old timers that sold us all out by hiring CRNA's and ruining anesthesiology as a specialty.
This is a well written commentary.
I dig it.
I dig it deep.

 

[BLADEMDA]

What a breath of fresh air.
I view this corporate takeover of anesthesia practices as no better than the old timers that sold us all out by hiring CRNA's and ruining anesthesiology as a specialty.
This is a well written commentary.
I dig it.
I dig it deep.

I'm glad you enjoyed the article. But, the one fact which matters most to some, not all, hospital CEOs is the following: "It turns out that our bid came in higher than the other bid."
Maybe, in 2004 that higher bid worked out in the end. Fast forward to 2016 and the climate is much worse. More and more CEOs view our service as just that, a service, which anyone can provide to the hospital. I do agree that being involved with the Executive staff, various committees, etc. all matter to group viability but in the end any group needing a subsidy will be forced to compete in the market.

I would rather sell to an AMC than submit a much higher bid to the hospital hoping that 2 decades of "good will" and committee involvement will keep my job. Instead, the AMC offers an immediate cash payout to the current group and the ability to slash the hospital stipend while maintaining current services. I am in total agreement that if you can keep the group going and avoid the AMC then by all means do so; but, for many practices the poor payer mix, hospital inefficiences combined with ZERO stipend is a death sentence.

 

[GravelRider]

Anything published by the ASA is going to paint an unrealistically positive picture of things. They are busy sending us propaganda instead of fighting real battles to win back the specialty.

Independent groups won't have to compete with AMCs much longer. The trend will become hospital employment instead. We are seeing a ferocious selling out of practices now because that is the future. Get paid now while you can. The word independent and physician will not appear in the same sentence in the future.

 

[Noyac]

I'm glad you enjoyed the article. But, the one fact which matters most to some, not all, hospital CEOs is the following: "It turns out that our bid came in higher than the other bid."
Maybe, in 2004 that higher bid worked out in the end. Fast forward to 2016 and the climate is much worse. More and more CEOs view our service as just that, a service, which anyone can provide to the hospital. I do agree that being involved with the Executive staff, various committees, etc. all matter to group viability but in the end any group needing a subsidy will be forced to compete in the market.

I would rather sell to an AMC than submit a much higher bid to the hospital hoping that 2 decades of "good will" and committee involvement will keep my job. Instead, the AMC offers an immediate cash payout to the current group and the ability to slash the hospital stipend while maintaining current services. I am in total agreement that if you can keep the group going and avoid the AMC then by all means do so; but, for many practices the poor payer mix, hospital inefficiences combined with ZERO stipend is a death sentence.

I know you guys just sold out Blade. I'm not criticizing you directly. Everyone has their own ship to sail.

But you gotta admit, it ain't good for the specialty, much less the pts.

It's a sell out much like the ACT model of the 80's and 90's.

 

[Stank811]

Anything published by the ASA is going to paint an unrealistically positive picture of things. They are busy sending us propaganda instead of fighting real battles to win back the specialty.

Independent groups won't have to compete with AMCs much longer. The trend will become hospital employment instead. We are seeing a ferocious selling out of practices now because that is the future. Get paid now while you can. The word independent and physician will not appear in the same sentence in the future.

We must be reading and hearing different things from the ASA. For the past 3-4 years most items from the ASA regarding buy out and AMC have been spun favorably for the AMC b/c most of the pieces or presentations where delivered by members of an AMC. So it is nice to see the alternative view.

I have always felt every scenario is regional which makes every decision a regional one. I do feel that many groups are selling with out taking a good look at alternative options largely because the alternative options do not provide a million dollar buy out to the senior partners looking for the golden parachute....I have a feeling if AMCs did not have the buy out option and just presented groups with management alternatives they would not be as popular. AMC often are a bunch of sales people who promise you and the administration the world and deliver a product that is no where close to what was promised and a ridiculous cost. Many times the AMC will also outsource services and charge the administration or group multiple of what they pay for the service themselves....they equal an additional middleman taking more money from the individuals doing the work and taking the risk.

 

[Robotic Wis-Hipple]

I agree with this, went to ASA Practice Management this year and it was literally completely sponsored by AMCs, speakers were AMC big wigs, and 90% of the conference booths/vendors were AMC/Locums services. I was completely turned off, total sell out. Two years ago it was much more about strengthening your practice and how to avoid the AMC encroachment. Sad.

 

[GravelRider]

We must be reading and hearing different things from the ASA. For the past 3-4 years most items from the ASA regarding buy out and AMC have been spun favorably for the AMC b/c most of the pieces or presentations where delivered by members of an AMC. So it is nice to see the alternative view.

I have always felt every scenario is regional which makes every decision a regional one. I do feel that many groups are selling with out taking a good look at alternative options largely because the alternative options do not provide a million dollar buy out to the senior partners looking for the golden parachute....I have a feeling if AMCs did not have the buy out option and just presented groups with management alternatives they would not be as popular. AMC often are a bunch of sales people who promise you and the administration the world and deliver a product that is no where close to what was promised and a ridiculous cost. Many times the AMC will also outsource services and charge the administration or group multiple of what they pay for the service themselves....they equal an additional middleman taking more money from the individuals doing the work and taking the risk.

I don't disagree that a good PP can provide better value for the hospital compared to an AMC. However, that is not why groups are selling out. No one says "how can we provide better patient care? I know, let's sell to NAPA!"

 

[BLADEMDA]

It isn't just buyout money which entices groups to sell; it is the entire future of the specialty combined with CEOs who want to slash subsidies. Groups are feeling the pressure from all sources: Hospital, AANA/DNP CRNA, increased regulations/metrics, decreased medicare/medicaid rates, etc. In this field unless you merge and get big the odds are not in your favor for the long term. If I had the choice my decision would have been to merge with other groups forming our own AMC. But, in the end it came down to take the buyout followed by AMC employment or no buyout followed by hospital or AMC employment in a year or two.

Some CEOs don't see any "value" outside the cost of the service. I fully agree private groups provide better service than AMCs but at what cost to the hospital? Does the CEO think the services are worth the cost? Clearly, the CEO at Mission Hospital in NC didn't see the value so he fired the entire group. Many CEOs just want the cheapest service they can get away with and that may mean "solo" CRNA care vs "Fireman" Anesthesiologist covering 6 CRNAs.

I truly hope the future of Anesthesiology involves hospital employment as the AANA is making it clear that we are not needed in the O.R.

 

[Stank811]

For example, say a group understand the administrators concerns and agrees to decrease subsidy by x amount which resulted in a 25k decrease in pay for all of the partners. By doing this the group was able to maintain control of their contract to cover said hospital system. After moving forward new opportunities arose for the group to cover additional services which were not available before which allowed the group to recoup the 25k loss and actually increase their bottom line. There are so many angles to look at when negotiating contracts and how it effects the business health of a group. CEOs do care about the bottom line but that does not necessarily mean they do not want your group to do well....usually you can find win-wins for all parties.

Blade would your group have voted to join the larger AMC and give up your groups power and autonomy if there was no buy out?

 

[Man o War]

For example, say a group understand the administrators concerns and agrees to decrease subsidy by x amount which resulted in a 25k decrease in pay for all of the partners. By doing this the group was able to maintain control of their contract to cover said hospital system. After moving forward new opportunities arose for the group to cover additional services which were not available before which allowed the group to recoup the 25k loss and actually increase their bottom line. There are so many angles to look at when negotiating contracts and how it effects the business health of a group. CEOs do care about the bottom line but that does not necessarily mean they do not want your group to do well....usually you can find win-wins for all parties.

Blade would your group have voted to join the larger AMC and give up your groups power and autonomy if there was no buy out?

My own personal experience is our hospital always wanted us to cover crap stuff that was a money loser after factoring in the money it cost to put a body in the room combined with worsening payer mix; add extreme inefficiency on the part of the hospital and it was a mess. I think this idea could work in a suburban hospital with an excellent payer mix, but those seem to be the minority. Every service expansion was an absolute battle. We ended up working harder for the same amount of money (or less in some cases).

 

[BLADEMDA]

For example, say a group understand the administrators concerns and agrees to decrease subsidy by x amount which resulted in a 25k decrease in pay for all of the partners. By doing this the group was able to maintain control of their contract to cover said hospital system. After moving forward new opportunities arose for the group to cover additional services which were not available before which allowed the group to recoup the 25k loss and actually increase their bottom line. There are so many angles to look at when negotiating contracts and how it effects the business health of a group. CEOs do care about the bottom line but that does not necessarily mean they do not want your group to do well....usually you can find win-wins for all parties.

Blade would your group have voted to join the larger AMC and give up your groups power and autonomy if there was no buy out?

Typically, a merger with an AMC or AMC type entity has a partial buyout. A full buyout means you are the bitch to the AMC. Start-up AMCs are funded by Wallstreet and founding groups get a partial buyout with stock in the new company.

Power and autonomy are an illusion if the hospital gives you a subsidy of any kind.

 

[Stank811]

Agreed almost always on first look the what the administrators are proposing you cover is going to look like a loss b/c of what you mentioned....most hospitals out of department and maybe intra-op workflow is really inefficient and often set up to benefit the surgeon or proceduralist.

Typically, a merger with an AMC or AMC type entity has a partial buyout. A full buyout means you are the bitch to the AMC. Start-up AMCs are funded by Wallstreet and founding groups get a partial buyout with stock in the new company.

Power and autonomy are an illusion if the hospital gives you a subsidy of any kind.

How is your position in the AMC any different if it is a partial buyout or a full buyout?

 

[BLADEMDA]

Agreed almost always on first look the what the administrators are proposing you cover is going to look like a loss b/c of what you mentioned....most hospitals out of department and maybe intra-op workflow is really inefficient and often set up to benefit the surgeon or proceduralist.


How is your position in the AMC any different if it is a partial buyout or a full buyout?

Partial buyouts are when they issue stock in the new company plus some cash as well. Full buyouts are when it is an all cash deal without any stock.

 

[sheeed]

I appreciate all the insight from you guys in regards to this topic(s)

...even our dermatology colleagues are dealing with management companies buying up their practices.

 

[Planktonmd]

This guy is basing all his argument on the assumption that the hospital CEO will continue to ignore cheaper offers just because he loves him and his group!!!

 

[Planktonmd]

I agree with this, went to ASA Practice Management this year and it was literally completely sponsored by AMCs, speakers were AMC big wigs, and 90% of the conference booths/vendors were AMC/Locums services. I was completely turned off, total sell out. Two years ago it was much more about strengthening your practice and how to avoid the AMC encroachment. Sad.

The ASA does not represent anesthesiologists any more, it is mainly a business that operates for the sole purpose of making money!

 

[IlDestriero]

For example, say a group understand the administrators concerns and agrees to decrease subsidy by x amount which resulted in a 25k decrease in pay for all of the partners. By doing this the group was able to maintain control of their contract to cover said hospital system. After moving forward new opportunities arose for the group to cover additional services which were not available before which allowed the group to recoup the 25k loss and actually increase their bottom line. There are so many angles to look at when negotiating contracts and how it effects the business health of a group.

They already do this.
They hire non partner track people for 350 or 375 and become their own AMC, with the partner shareholders propping up their declining income.
That only works for so long. My buddy's group sold out when they lost a contract to one of their lucrative centers to another group unexpectedly at the 11th hour of contract negotiations. They had negotiations coming up with their main hospital, got scared, and sold out. They were already employing their own non partner track people. You can only take so many pay cuts and accept so much risk. Then someone comes along and dangles a tax advantaged $2M check in your face and guarantees you a contract renewal for another 3 or 5 years.


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Il Destriero

 

[IlDestriero]

This guy is basing all his argument on the assumption that the hospital CEO will continue to ignore cheaper offers just because he loves him and his group!!!

Good luck with that.


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Il Destriero

 

[Planktonmd]

My own personal experience is our hospital always wanted us to cover crap stuff that was a money loser after factoring in the money it cost to put a body in the room combined with worsening payer mix; add extreme inefficiency on the part of the hospital and it was a mess. I think this idea could work in a suburban hospital with an excellent payer mix, but those seem to be the minority. Every service expansion was an absolute battle. We ended up working harder for the same amount of money (or less in some cases).

This is exactly the issue! They want you to constantly expand your coverage and do more things for free!
And since there are AMC's waiting to jump on your contract, you have 4 choices:
1- Do what ever the admin tells you to do until you can no longer sustain the group because of the increasing work load and declining pay. The end result you lose the contract to an AMC.
2- Sell out to an AMC early on while your contract has some value (maybe the smartest choice).
3- Become a predatory group exploiting new anesthesiologists and merging with other predatory groups to form mega groups, which are basically AMCs disguised as private groups!
4- Beg the hospital to employ you.
So, the end result is no more private groups no matter how you slice it!

 

[GravelRider]

This is exactly the issue! They want you to constantly expand your coverage and do more things for free!
And since there are AMC's waiting to jump on your contract, you have 4 choices:
1- Do what ever the admin tells you to do until you can no longer sustain the group because of the increasing work load and declining pay. The end result you lose the contract to an AMC.
2- Sell out to an AMC early on while your contract has some value (maybe the smartest choice).
3- Become a predatory group exploiting new anesthesiologists and merging with other predatory groups to form mega groups, which are basically AMCs disguised as private groups!
4- Beg the hospital to employ you.
So, the end result is no more private groups no matter how you slice it!

But the Perioperative Surgical Home...

 

[Planktonmd]

But the Perioperative Surgical Home...

Oh yes... the ultimate solution to all our problems!

 

[easternether]

What a breath of fresh air.
I view this corporate takeover of anesthesia practices as no better than the old timers that sold us all out by hiring CRNA's and ruining anesthesiology as a specialty.
This is a well written commentary.
I dig it.
I dig it deep.

I think with time the reduced value of AMC will become known.

 

[Planktonmd]

I think with time the reduced value of AMC will become known.

I wouldn't hold my breath!

 

[Noyac]

I agree with plank here. It's all about the money and that isn't gonna change.

 

[deleted50478]

I think with time the reduced value of AMC will become known.

Value has nothing to do with it.

Our only hope is that hospital employment takes over from AMCs.

 

[Ignatius J]

I think with time the reduced value of AMC will become known.

I think with bundled payments coming the pendulum will swing away from AMCs in the next 5-10 years. Once you lose leverage in negotiations, which I think will happen with bundled payments, you don't need a big monstrosity of a management company to figure out how to run an anesthesia practice.

 

[BLADEMDA]

I think with bundled payments coming the pendulum will swing away from AMCs in the next 5-10 years. Once you lose leverage in negotiations, which I think will happen with bundled payments, you don't need a big monstrosity of a management company to figure out how to run an anesthesia practice.

I agree with you. The future is direct employment by a hospital or academic center. Now, if the hospital is looking to employ an Anesthesiologist would they rather hire the new grad with a fellowship in a sought after area or a "generalist" to supervise the 6 "solo" CRNAs? The bottom line is that as CRNAS take over the regular cases the better jobs will go to those who have "certification" in desired specialties like Pain, Critical Care, Peds and TEE/Cardiac.

 

[Ignatius J]

I agree with you. The future is direct employment by a hospital or academic center. Now, if the hospital is looking to employ an Anesthesiologist would they rather hire the new grad with a fellowship in a sought after area or a "generalist" to supervise the 6 "solo" CRNAs? The bottom line is that as CRNAS take over the regular cases the better jobs will go to those who have "certification" in desired specialties like Pain, Critical Care, Peds and TEE/Cardiac.

I think it could be combo of private groups and hospital groups. I've seen that with a 8 room OR facility that was a good business. They had an idea to hire their own anesthesiologists at first but it didn't make sense. They would have to hire extra salaried bodies to ensure flexibility with sick days, vacations, slow days, late add-ons, etc. It would be easier just to outsource the coverage to a bigger group that covers several locations in town and say "Here, when I say "jump", you say "how high". With a smaller town, yeah, you won't have those large groups with that flexibility and you will have to employ them yourself. But I still don't think if given the option that a hospital would consistently want to hire their own anesthesiologists over a private group. Put all that coverage burden on the group with the contract and miniimize how many bodies you have to pay on any given day. Let them figure that out. Easy cheesy.

 

[Planktonmd]

I think it could be combo of private groups and hospital groups. I've seen that with a 8 room OR facility that was a good business. They had an idea to hire their own anesthesiologists at first but it didn't make sense. They would have to hire extra salaried bodies to ensure flexibility with sick days, vacations, slow days, late add-ons, etc. It would be easier just to outsource the coverage to a bigger group that covers several locations in town and say "Here, when I say "jump", you say "how high". With a smaller town, yeah, you won't have those large groups with that flexibility and you will have to employ them yourself. But I still don't think if given the option that a hospital would consistently want to hire their own anesthesiologists over a private group. Put all that coverage burden on the group with the contract and miniimize how many bodies you have to pay on any given day. Let them figure that out. Easy cheesy.

The big group that covers multiple locations in town is basically an AMC!

 

[Ignatius J]

The big group that covers multiple locations in town is basically an AMC!

Not at all.

 

[IlDestriero]

The big group that covers multiple locations in town is basically an AMC!

I would change that to read the big group that covers multiple locations in town and hires non-partner track Anesthesiologists is basically an AMC.


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Il Destriero

 

[Planktonmd]

I would change that to read the big group that covers multiple locations in town and hires non-partner track Anesthesiologists is basically an AMC.


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Il Destriero

Exactly!

 

[Ignatius J]

I would change that to read the big group that covers multiple locations in town and hires non-partner track Anesthesiologists is basically an AMC.


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Il Destriero

And I don't think that's a huge rarity. In the state I live anyways. Bottom line is that you can still get by without national groups. Maybe easier here soon.

 

[deleted50478]

I think it could be combo of private groups and hospital groups. I've seen that with a 8 room OR facility that was a good business. They had an idea to hire their own anesthesiologists at first but it didn't make sense. They would have to hire extra salaried bodies to ensure flexibility with sick days, vacations, slow days, late add-ons, etc. It would be easier just to outsource the coverage to a bigger group that covers several locations in town and say "Here, when I say "jump", you say "how high". With a smaller town, yeah, you won't have those large groups with that flexibility and you will have to employ them yourself. But I still don't think if given the option that a hospital would consistently want to hire their own anesthesiologists over a private group. Put all that coverage burden on the group with the contract and miniimize how many bodies you have to pay on any given day. Let them figure that out. Easy cheesy.

Any group with a significant number of docs making higher than average incomes (or any AMCs with useless suits making money) should be able to be replaced by hospital employment.

For example, if a small AMC has 4 partners making $450 and 4 employed docs making $300k, the hospital could kick them out, get more coverage with 10 employed docs for $300k each, or keep it at 8 docs and have $600k in profit.

 

[Noyac]

There are all types of setups out there. The bigger communities with multiple hospitals seem to be the ones on the AMC radar these days. I'm not sure when they will start to look outside these communities at the smaller ones. Actually, some AMC's have but I think it's because the hospital themselves brought them in.

As many of you are aware, I am an employed anesthesiologist. I am guaranteed the national (not regional) 50th percentile and have made more than that every year. But it comes with many other burdens that private groups don't have. But then again, I am spared some of their burdens. One of the burdens I'm faced with is the cost of my group. Hospitals are notoriously poor at negotiating insurance reimbursement for anesthesia services. They tend to bundle them in with other costs like labs and overnight stays ect. This makes the group's collections look bad but in reality it isn't. As an employee you must understand the economics in order to get a fair shake. AMC's seem to struggle in the smaller communities from what I see. Two very well known ones were booted out of their hospitals just this year in my area. So if I read Ignatius' post right, things are better in my area for now as well. But smaller community hospital jobs are more likely to be employed positions which many here are opposed too. I understand that.

 

[Mman]

Any group with a significant number of docs making higher than average incomes (or any AMCs with useless suits making money) should be able to be replaced by hospital employment.

For example, if a small AMC has 4 partners making $450 and 4 employed docs making $300k, the hospital could kick them out, get more coverage with 10 employed docs for $300k each, or keep it at 8 docs and have $600k in profit.

Except the hospital will negotiate worse reimbursement so there will be less money available to pay the docs. And those docs will no longer have a motivation to work hard. Because as Office Space pointed out, they will work just hard enough to not get fired. I'd argue that any hospital employed docs could be replaced by a private group with higher salaries to the docs and less cost to the hospital.

 

[deleted50478]

Except the hospital will negotiate worse reimbursement so there will be less money available to pay the docs. And those docs will no longer have a motivation to work hard. Because as Office Space pointed out, they will work just hard enough to not get fired. I'd argue that any hospital employed docs could be replaced by a private group with higher salaries to the docs and less cost to the hospital.

Where I am, the employed docs work more for less money than the partners, so my experience would argue the opposite. Hospitals don't HAVE to negotiate worse reimbursement. I can see how that would cut into their profit but there's no reason it shouldn't change.

 

[Mman]

Where I am, the employed docs work more for less money than the partners, so my experience would argue the opposite. Hospitals don't HAVE to negotiate worse reimbursement. I can see how that would cut into their profit but there's no reason it shouldn't change.

Hospitals don't "HAVE to", they just do. It's a fact of life. To them the anesthesia billing is peanuts so they really don't care.

 

[Ignatius J]

Any group with a significant number of docs making higher than average incomes (or any AMCs with useless suits making money) should be able to be replaced by hospital employment.

For example, if a small AMC has 4 partners making $450 and 4 employed docs making $300k, the hospital could kick them out, get more coverage with 10 employed docs for $300k each, or keep it at 8 docs and have $600k in profit.

All depends on the stipend the hospital gives. And they need other workers as well if they are going to employee the anesthesiologists. An AMC will do their own licensing, billing, collecting, insurance negotiations, etc. that a hospital would need positions for. And again, a bigger group gives flexibility. If a hospital needs 8 anesthesiologists a day they would likely need to employ more than that to ensure coverage and provide time for vacation, sick/maternity leave, appointments, meetings, etc.

 

[GravelRider]

I am not opposed to employment, but you have to know how your time is being valued. Whether it is with weekly or annual hours worked, and a way to compensate you if you work more (not with idiotic productivity bonuses). If you are salaried then what is their incentive to not cut staffing and demand increases in surgical volume. And oh by the way, there's an awful restrictive covenant, so if you don't like it, too bad. Making 350k is alot different if you are working 40 hours a week with 8 weeks vacation vs 65 hours a week with 4 weeks vacation.

 

[deleted162650]

OK, hypothetical time:

Let's say you're a partner in a PP group that receives a subsidy from the hospital. The hospital has made it clear that they now think you are too expensive and would like to reduce the subsidy. At the same time, you have been approached by a large AMC (Mednax, Sheridan, NAPA, whoever) about buying out your practice. Why not take that and use it as leverage against the insurance companies to negotiate higher contract rates? Sit down at the table with them and say, "Look, we would like to see our contract rates increase by x %. Otherwise we will in a position where it makes more sense for us to sell, and then you guys are gonna be stuck paying even higher AMC contract rates." It seems like this would be a win/win/win scenario. Your group essentially maintains it's current income level. You make the hospital happy by accepting less stipend. You keep control of your business. The insurance company avoids paying exorbitant AMC rates. The only loser is the AMC, and I'm not gonna shed too many tears for them.

 

[BLADEMDA]

Small Private group vs Large AMC- which one will the Insurance companies be afraid of? size matters when negotiating rates!

 

[deleted162650]

Small Private group vs Large AMC- which one will the Insurance companies be afraid of? size matters when negotiating rates!

Exactly. So wouldn't the insurance company want to play ball with your group to avoid getting raked over the coals by the AMC?

 

[GravelRider]

Exactly. So wouldn't the insurance company want to play ball with your group to avoid getting raked over the coals by the AMC?

The insurance companies are not being raked over the coals. They have been around a lot longer than the AMCs and will outlast most AMCs. The loser in this scenario is the patients or businesses that have to now pay higher insurance premiums.

 

[Mman]

Exactly. So wouldn't the insurance company want to play ball with your group to avoid getting raked over the coals by the AMC?

They will. I wouldn't out and out threaten them with it, but when you are being swarmed by AMCs, giving you a nice annual raise in your contract rates is standard for insurance companies. They aren't stupid.

 

[Ignatius J]

They will. I wouldn't out and out threaten them with it, but when you are being swarmed by AMCs, giving you a nice annual raise in your contract rates is standard for insurance companies. They aren't stupid.

None of the new rate goes in your pocket. The AMC draw is th buyout. The increased rate just goes into their pockets. Which means with the move to bundled payments this house of cards may begin to fall. I think we will see that it will.

 

[Planktonmd]

They will. I wouldn't out and out threaten them with it, but when you are being swarmed by AMCs, giving you a nice annual raise in your contract rates is standard for insurance companies. They aren't stupid.

You are assuming that the patient population consists primarily of patients with private insurance companies who the AMC's have negotiated lower rates with!
The reality is that most of your patients are covered by medicare, and medicare doesn't care who gets paid because they don't negotiate rates!

 

[Mman]

None of the new rate goes in your pocket. The AMC draw is th buyout. The increased rate just goes into their pockets. Which means with the move to bundled payments this house of cards may begin to fall. I think we will see that it will.

Huh? We are talking about a private group negotiating with an insurance company. There is no AMC involved except the threat of the group selling out to one.

 

[Mman]

You are assuming that the patient population consists primarily of patients with private insurance companies who the AMC's have negotiated lower rates with!
The reality is that most of your patients are covered by medicare, and medicare doesn't care who gets paid because they don't negotiate rates!

I'm not assuming anything. The AMCs have far higher rates with insurance companies than private groups do. I suspect their median is $150 per unit. It doesn't matter what percentage of your patients are insured, if you can get a higher rate for those patients it helps as great deal.