Ophthalmologists as hospital employees

[viscera]

http://www.ophthalmologymanagement.com/articleviewer.aspx?articleID=106793

This article claims that there has been a recent trend in hospitals looking to buy ophthalmology practices and thus placing ophthalmologists into employed positions. Have any attendings observed this phenomenon in their respective regions?

---

Members don't see this ad.

 

[orbitsurgMD]

The article seems to be about hospitals buying ASCs, not ophthalmology practices. ASC is where the money is, provided you have negotiating strength to get bottom-dollar prices on supplies and you can reap efficiencies on combining coding and billing operations with other business units.

It's hardly news. Hospitals have long been at least partners in ASCs all over the place.

 

[viscera]

Could you please clarify the distinction between an ASC and a practice? I had previously thought ASCs were simply facilities in which surgeries were performed as an adjunct of a single practice.

Also, would it be reasonable to assume that ophthalmologists will continue to evade the pressures of hospital employment that other specialists face?

 

[ophthope]

Could you please clarify the distinction between an ASC and a practice? I had previously thought ASCs were simply facilities in which surgeries were performed as an adjunct of a single practice.

Also, would it be reasonable to assume that ophthalmologists will continue to evade the pressures of hospital employment that other specialists face?

An ambulatory surgery center does not often serve just a single practice - the ASC in my town is where about 5 Ophthos, 8 Orthopods, and 10 General Surgeons do their outpatient surgery cases. Quite a few EGD/Colonoscopies performed there as well.

I'm not 'in the know' enough to comment on hospitals attempting to employ Ophthalmologists.

 

[orbitsurgMD]

ASC=Ambulatory Surgery Center. These are stand-alone (theoretically, but many are owned by and captive of private practices) facilities that provide operating room facilities and staffing for outpatient surgery. They exist as independent businesses and can be owned in various ways, but most commonly as LLCs with multiple share-owning members. They generate their own revenue streams from billing for services done within their walls. Commonly the owners will be surgeons and anesthesiologists using the facility. Profits are usually divided in proportion to share ownership rather than pro rata utilization to avoid allegations of kickbacks or self-dealing, although there may be covenants in the membership agreement that requires surrender of shares for buyout if a shareowner performs too many cases at competing facilities.

I have known of hospitals to purchase shares of ASCs that service mainly ophthalmology procedures done by high-volume eye surgery practices, primarily cataract, but the hospitals were not buying the practices of the doctors using those ASCs.

 

[Dusn]

Could you please clarify the distinction between an ASC and a practice? I had previously thought ASCs were simply facilities in which surgeries were performed as an adjunct of a single practice.

Also, would it be reasonable to assume that ophthalmologists will continue to evade the pressures of hospital employment that other specialists face?

If by "hospital" you really mean some sort of bureaucratic entity like an ACO, then no. That's the way all of medicine is heading. I'm guessing that the ACOs will likely often be headed by large hospitals. The fact that ophtho has such a large medicare patient base probably won't help.

 

[viscera]

First off, I appreciate everyone's response to my questions.

orbitsurgMD, I come across your posts often and they always add an impressive amount of substance to any discussion.

If by "hospital" you really mean some sort of bureaucratic entity like an ACO, then no. That's the way all of medicine is heading. I'm guessing that the ACOs will likely often be headed by large hospitals. The fact that ophtho has such a large medicare patient base probably won't help.

Actually, this was exactly another question I had in mind. It seems to me that hospitals are naturally poised to lead ACOs due to the amount of influence (both political and financial) they impose on health care markets.

The question remains though whether ACOs (lead by hospitals) would indeed make direct efforts in acquiring ophthalmology practices or would it suffice for ACOs to simply partner with individual practice(s) to provide ophthalmic services.

 

[orbitsurgMD]

The last question is an interesting one. What would an ACO-owned eye service look like, if such a thing were to be created? My guess is that it would resemble something much more like a Kaiser Permanante closed-panel HMO than a traditional academic or multispecialty ophthalmology practice. The bulk of routine medical eyecare would be delegated to optometrists with referral to a handful of general ophthalmologists and outside referral would be limited to a handful of contracted subspecialists not on the ACO payroll (but who may be competitively bid out.) The ACO wants to handle as much as possible within the organization and do so in the lowest-cost way. The ophthalmologists would be doing mostly surgery, but as little followup as possible, delegating most of that care to the optometric staff if possible. Efficiency and "optimization" of resources would probably require "bending" the traditional notion of the surgeon overseeing the entire pre-intra-post-operative care cycle.

The ACO idea is nothing more than capitated managed care for Medicare, with the risk (and supposed "rewards" ) being assigned to the ACO. The hard truth is that the future will mean progressive lowering of the payments, and the basis for doing so will be data mining-driven analysis of patient cohorts defined by elaborated ICD-10 codes and CPT codes for treatments and services. You can bet that the payment for a cohort of beneficiaries will be lowered to whatever the lowest decile of costs/services that don't result in a statistically-significant increase in new ICD-10 descriptors of complications, and that analysis will be run over and over seeking ever more minimal patterns of expenditures that don't lead to more problems, and that will be the payment benchmark. This is how the CMS will be getting around the regional variations in utilization of services; they will stop paying for anything more than whatever care results in no signigicant ICD-defined increase in occurrence of disease-associated diagnoses. The costs of exceeding that minimum standard will be borne by the ACO, which will be under significant pressure to conform.

 

[Visionary]

The ACO idea is nothing more than capitated managed care for Medicare, with the risk (and supposed "rewards" ) being assigned to the ACO. The hard truth is that the future will mean progressive lowering of the payments, and the basis for doing so will be data mining-driven analysis of patient cohorts defined by elaborated ICD-10 codes and CPT codes for treatments and services. You can bet that the payment for a cohort of beneficiaries will be lowered to whatever the lowest decile of costs/services that don't result in a statistically-significant increase in new ICD-10 descriptors of complications, and that analysis will be run over and over seeking ever more minimal patterns of expenditures that don't lead to more problems, and that will be the payment benchmark. This is how the CMS will be getting around the regional variations in utilization of services; they will stop paying for anything more than whatever care results in no signigicant ICD-defined increase in occurrence of disease-associated diagnoses. The costs of exceeding that minimum standard will be borne by the ACO, which will be under significant pressure to conform.

You've hit the nail on the head. This is the reason for the overly detailed new ICD-10 codes.

 

[long]

The last question is an interesting one. What would an ACO-owned eye service look like, if such a thing were to be created? My guess is that it would resemble something much more like a Kaiser Permanante closed-panel HMO than a traditional academic or multispecialty ophthalmology practice. The bulk of routine medical eyecare would be delegated to optometrists with referral to a handful of general ophthalmologists and outside referral would be limited to a handful of contracted subspecialists not on the ACO payroll (but who may be competitively bid out.) The ACO wants to handle as much as possible within the organization and do so in the lowest-cost way. The ophthalmologists would be doing mostly surgery, but as little followup as possible, delegating most of that care to the optometric staff if possible. Efficiency and "optimization" of resources would probably require "bending" the traditional notion of the surgeon overseeing the entire pre-intra-post-operative care cycle.

The ACO idea is nothing more than capitated managed care for Medicare, with the risk (and supposed "rewards" ) being assigned to the ACO. The hard truth is that the future will mean progressive lowering of the payments, and the basis for doing so will be data mining-driven analysis of patient cohorts defined by elaborated ICD-10 codes and CPT codes for treatments and services. You can bet that the payment for a cohort of beneficiaries will be lowered to whatever the lowest decile of costs/services that don't result in a statistically-significant increase in new ICD-10 descriptors of complications, and that analysis will be run over and over seeking ever more minimal patterns of expenditures that don't lead to more problems, and that will be the payment benchmark. This is how the CMS will be getting around the regional variations in utilization of services; they will stop paying for anything more than whatever care results in no signigicant ICD-defined increase in occurrence of disease-associated diagnoses. The costs of exceeding that minimum standard will be borne by the ACO, which will be under significant pressure to conform.

This sounds awful.

 

[Dusn]

Well as a very timely answer to your question, the AAO posted a video today addressing this question:

http://www.youtube.com/watch?v=K3dOskzAsUc

 

[viscera]

Dusn, thanks a lot for sharing that link with us.

However you slice, it seems like all of medicine is destined (doomed) to at least contractual affiliation with these hospital systems in the future. Wonderful. In a few years time, I will have both big brother and the man breathing down my neck as I try to scratch a living off of inefficient, pressurized medicine. Apologies for the cynicism.