Taking on CMGs

[ski89]

Im curious to better understand why it is CMGs actually exist and to brainstorm ways in which we may be able to stop their proliferation in the future.

My understanding is that CMGs essentially act as a middle men between the hospital and the EPs. Their one goal is to maximize profits and to scale. And in doing so implement policies at odds with patient care and at odds with the well being of EPs (both financially and psychologically).

Now what I don’t understand is how this happened. It seems to me that a physician owned group should be able to provide services to a hospital at a far better cost by cutting out the middle man and also take home a larger piece of the cake while maintaining more control of the practice environment.

I would love to know what I’m missing in terms of why CMGs are so pervasive and why it is apparently so difficult to slow them down. But more than that I would like to hear how EPs can push back and move toward taking back control of our practice environment.

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[bravotwozero]

I believe it is because a lot of hospital EDs are likely money losers in terms of revenue, given all the self pay patients they see or the people not willing to pay their co pays. A small SDG would not survive in such an environment, whereas a large CMG could sustain losses as long as they have enough profitable contracts elsewhere.

It’s like what amazon is doing to everyone else’s livelihoods - because they’re sitting on billions of dollars worth of capital, they can afford to deliberately under sell their products at a loss, which inevitably puts the brick and mortar shops out of business, since they have to cover their overhead and don’t have the capitol to sustain losses.


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[Rekt]

Im curious to better understand why it is CMGs actually exist and to brainstorm ways in which we may be able to stop their proliferation in the future.

My understanding is that CMGs essentially act as a middle men between the hospital and the EPs. Their one goal is to maximize profits and to scale. And in doing so implement policies at odds with patient care and at odds with the well being of EPs (both financially and psychologically).

Now what I don’t understand is how this happened. It seems to me that a physician owned group should be able to provide services to a hospital at a far better cost by cutting out the middle man and also take home a larger piece of the cake while maintaining more control of the practice environment.

I would love to know what I’m missing in terms of why CMGs are so pervasive and why it is apparently so difficult to slow them down. But more than that I would like to hear how EPs can push back and move toward taking back control of our practice environment.

CMG guy realizes he only has 8 cars for his 12 car garage. He then goes to the non-CMG hospital and tells them they can make lots of money if they trust them. They use lots of business words like "Synergism" "Streamline" "Transform". Admins realize their yachts are smaller than their neighbors and would love more money. Hospital-EM contract is either not renewed, forced out, or bought out. CMGs staff the ED for whoever left, usually with new grads taking the first job they can and they don't know any better. CMG cuts salaries, profit sharing doesn't exist anymore, metrics are increased and enforced harsher. CMG and hospital makes more money, physicians lose. Hospital becomes a revolving door of employment and patient care suffers.

Most practicing docs have their job already and likely a majority don't really care about the future of EM. It's not worth the time and/or money to advocate against them. Most are also supporting the wrong guys (ACEP) who have no problem with CMGs (President is/was a CMG dude. Also they helped put together/fund this NP EM certification).

 

[EM Junkie]

CMG guy realizes he only has 8 cars for his 12 car garage. He then goes to the non-CMG hospital and tells them they can make lots of money if they trust them. They use lots of business words like "Synergism" "Streamline" "Transform". Admins realize their yachts are smaller than their neighbors and would love more money. Hospital-EM contract is either not renewed, forced out, or bought out. CMGs staff the ED for whoever left, usually with new grads taking the first job they can and they don't know any better. CMG cuts salaries, profit sharing doesn't exist anymore, metrics are increased and enforced harsher. CMG and hospital makes more money, physicians lose. Hospital becomes a revolving door of employment and patient care suffers.

Most practicing docs have their job already and likely a majority don't really care about the future of EM. It's not worth the time and/or money to advocate against them. Most are also supporting the wrong guys (ACEP) who have no problem with CMGs (President is/was a CMG dude. Also they helped put together/fund this NP EM certification).

They’ll care soon enough. 10 years out here. Same hospital since residency. Went from SDG to larger group to CMG in 18 months. I’ll let you know how it goes.

A big factor for us was in network vs out of network billing. Hospital wants us in network with everyone. It’s impossible for a small group of docs to swing that, what with EMTALA and all. Much easier for large CMG.

The solution? Enforce existing laws on the corporate practice of medicine.


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[GeneralVeers]

The hospital I'm at is on their 4th group in 5 years. 3 of them CMGs, and one was a small corporation run by two guys. Seems these groups keep making the same promises to "fix" the system issues and convince the CEOs to change the contract.

 

[RustedFox]

The hospital I'm at is on their 4th group in 5 years. 3 of them CMGs, and one was a small corporation run by two guys. Seems these groups keep making the same promises to "fix" the system issues and convince the CEOs to change the contract.

Shell game is Shell game.

 

[deuist]

The one thing that these contract management groups are good at compared to the democratic groups is billing and paper work. A small group of 10 doctors will have a hard time maximizing billing across multiple insurance companies compared to a national contract management group. That's why physicians at CMG's can sometimes make more money than working with a SDG.

 

[EM Junkie]

The one thing that these contract management groups are good at compared to the democratic groups is billing and paper work. A small group of 10 doctors will have a hard time maximizing billing across multiple insurance companies compared to a national contract management group. That's why physicians at CMG's can sometimes make more money than working with a SDG.

I hope you’re right!!


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[ski89]

They’ll care soon enough. 10 years out here. Same hospital since residency. Went from SDG to larger group to CMG in 18 months. I’ll let you know how it goes.

A big factor for us was in network vs out of network billing. Hospital wants us in network with everyone. It’s impossible for a small group of docs to swing that, what with EMTALA and all. Much easier for large CMG.

The solution? Enforce existing laws on the corporate practice of medicine.


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So hospital wants in network with everyone, that makes sense from their perspective. I guess I don’t understand how the CMG fixes that issue. Is the CMG just eating the out of network cost?

Also, can you expand on what existing laws might be in play?

 

[ski89]

The one thing that these contract management groups are good at compared to the democratic groups is billing and paper work. A small group of 10 doctors will have a hard time maximizing billing across multiple insurance companies compared to a national contract management group. That's why physicians at CMG's can sometimes make more money than working with a SDG.

Yeah that also makes sense. But it would seem to me that a savvy physician owned group could simply hire someone to assist with billing and or incentivize docs in some way to bill appropriately. Right?

 

[ski89]

The hospital I'm at is on their 4th group in 5 years. 3 of them CMGs, and one was a small corporation run by two guys. Seems these groups keep making the same promises to "fix" the system issues and convince the CEOs to change the contract.

What are some of these system issues?

 

[Groove]

You’re not going to stop their proliferation. The model has been adopted, entrenched, proven and is already the most common employment model for EM docs. I’m not saying I like it, but I’m willing to recognize why the model has proliferated. CMGs are streamlined, efficient, lean and can manage the business aspects of a medical practice many times better than your average group of docs. They can virtually always maximize billing and minimize costs and have economies of scale as well as financial liquidity which gives them leverage when negotiating contracts, incentivizing docs, etc.. They can train firefighter travelers to immediately staff new contracts and can shift money around to give 50K to a new grad as a sign on incentive many times more easily than any SDG.

The model is and always will be attractive to new docs who are not 100% convinced they want to stay in one area forever and want to hit the ground running, making just as much on day 1 as the docs who have been there for 10 years. Some of the sign on incentives are ridiculous. 50-75K up front, 100K loan repayment, etc.. It’s hard for SDGs to match that so I totally get how they are scooping up all the new grads.

SDGs are dying and have been for awhile. All of the SDGs I once considered 6-7 years ago have been bought out and are now CMG.

 

[ski89]

You’re not going to stop their proliferation. The model has been adopted, entrenched, proven and is already the most common employment model for EM docs. I’m not saying I like it, but I’m willing to recognize why the model has proliferated. CMGs are streamlined, efficient, lean and can manage the business aspects of a medical practice many times better than your average group of docs. They can virtually always maximize billing and minimize costs and have economies of scale as well as financial liquidity which gives them leverage when negotiating contracts, incentivizing docs, etc.. They can train firefighter travelers to immediately staff new contracts and can shift money around to give 50K to a new grad as a sign on incentive many times more easily than any SDG.

The model is and always will be attractive to new docs who are not 100% convinced they want to stay in one area forever and want to hit the ground running, making just as much on day 1 as the docs who have been there for 10 years. Some of the sign on incentives are ridiculous. 50-75K up front, 100K loan repayment, etc.. It’s hard for SDGs to match that so I totally get how they are scooping up all the new grads.

SDGs are dying and have been for awhile. All of the SDGs I once considered 6-7 years ago have been bought out and are now CMG.

I agree that it seems unlikely to “stop their proliferation” at least in the current healthcare environment, but my interest is more on a case by case basis. In other words is it reasonable for a business savvy and motivated group of emergency physicians to push out a CMG say at one hospital or small group of hospitals.

For example, why do you think large democratic groups in Utah have survived for so long? Is there something unique at play there?

 

[Birdstrike]

You’re not going to stop their proliferation. The model has been adopted, entrenched, proven and is already the most common employment model for EM docs. I’m not saying I like it, but I’m willing to recognize why the model has proliferated. CMGs are streamlined, efficient, lean and can manage the business aspects of a medical practice many times better than your average group of docs. They can virtually always maximize billing and minimize costs and have economies of scale as well as financial liquidity which gives them leverage when negotiating contracts, incentivizing docs, etc.. They can train firefighter travelers to immediately staff new contracts and can shift money around to give 50K to a new grad as a sign on incentive many times more easily than any SDG.

The model is and always will be attractive to new docs who are not 100% convinced they want to stay in one area forever and want to hit the ground running, making just as much on day 1 as the docs who have been there for 10 years. Some of the sign on incentives are ridiculous. 50-75K up front, 100K loan repayment, etc.. It’s hard for SDGs to match that so I totally get how they are scooping up all the new grads.

SDGs are dying and have been for awhile. All of the SDGs I once considered 6-7 years ago have been bought out and are now CMG.

You're right. The hospitals have chosen CMGs as their preferred vendors for EM services across the board, with few exceptions. You can "take on the CMGs" all you want, but you're fighting the wrong battle. Fighting CMGs does nothing to convince hospitals to contract with SDGs that you think would treat you better. The hospitals have chosen the CMGs over SDGs. The only reasonable ways forward are to either accept CMGs for what they are, join an SDG and work there until it's replaced by a CMG, or start your own SDG and offer hospitals a better service than the CMGs they contract with.

The boogeyman here is not the CMGs who convinced hospitals they can serve them better. The boogeyman is not the hospitals who think the CMGs are better vendors. It's the SDGs that have failed to persuade the hospitals they can provide a better service and be better vendors than anyone else. Who you or I would rather work for, is not even part of the equation, because not enough EM physicians feel that way to create a critical shortage for the CMGs that's too severe for them to thrive. Docs keep lining up to work for the CMGs because their principles can't stand strong longer than one pay period without a paycheck, so they just line up to work for the first CMG that will allow them to continue their hyper-consumer lifestyle.

Hate on hospitals and CMGs all you want, but SDGs just haven't been able to compete or adapt, so they're going extinct. It's pure, unavoidable Darwinism. Don't try to make it more complicated than that.

 

[GeneralVeers]

What are some of these system issues?

- Holding 40-50 patients daily in the ED (yes even in hallway beds)
- Most patients seen and discharged from lobby despite their complaint
- 4-5 hour length of stay for lobby patients
- Angry patients (due to all of the above)

The problem is that the primary issue is lack of inpatient bed space, and failure to discharge admitted patients in a timely manner. Neither the EM docs, or the CMG has any input into the real problems with hospital.

 

[deleted859535]

SDG here.

We are a dying breed. We -- my partners and I -- know that, but fortunately, we've stayed independent thus far. As far as I'm aware, we all want it to stay that way and thus do what's needed to keep it that way.

I don't think there are any illusions about the future. We might be independent ten years from now, or there might be enough of a shake up that we "sell out" in two.

My colleagues above have explained why for sure. At least for me, I have friends with CMGs who are happy, or as happy as they can be -- they go to work and go home. Clock punchers. Who could blame them? EM is stressful enough without also being involved in the stuff behind the curtain. But as AAEM will be happy to tell you, CMGs as a whole tend to be not as good for emergency physicians in the big picture as SDGs tend to be.

I don't know that there's a good answer. I don't think the sky is truly falling yet. But it's definitely one of a few big reasons why I don't know if I would choose EM again regardless of the fact that the grass probably isn't greener.

 

[emergentmd]

CMGs get vilified and many times rightfully so. I get a sense that the same CMG in different cities treat physicians differently thus there must be alot of local influences depending on your medical/regional director.

SDGs definitely have their benefits but also requires the docs to do much more admin stuff.
CMGs docs can have very little to zero Admin stuff to worry about and they like it better.

We had a SDG that paid real well. Most docs were making 225-250/hr Plus benefits plus a 40K distribution as an owner.
CMG took over and essentially keep pay the same minus the owner distribution which to the nonpartners was pay neutral.

So all in all, the work/pay was no different for nonpartners with the benefit of not worrying about being on a bunch of committees.

Who knows what will happen down the road.

 

[Vandalia]

The boogeyman here is not the CMGs who convinced hospitals they can serve them better. The boogeyman is not the hospitals who think the CMGs are better vendors. It's the SDGs that have failed to persuade the hospitals they can provide a better service and be better vendors than anyone else. Who you or I would rather work for, is not even part of the equation, because not enough EM physicians feel that way to create a critical shortage for the CMGs that's too severe for them to thrive. Docs keep lining up to work for the CMGs because their principles can't stand strong longer than one pay period without a paycheck, so they just line up to work for the first CMG that will allow them to continue their hyper-consumer lifestyle.

Amen. I have been around enough hospital administrators to know that they do not have opinions. They do not care a fig about the anesthesiologist v CRNA v AA debate. They don't care if the person in the ED is an MD an NP or a PA. They don't care about the structure of the organization that takes care of their ED, or anesthesia, or radiology.

The only thing they care about is who can make their job easier. CMGs have been able to convince them that they are most able to meet that goal. Now I think that in many cases they have set them up for failure, which might allow a SDG to enter.

The fundamental, core, problem is that physicians simply don't know how to present a logical, financial argument. As a rep of the credentials committee, years ago, I got dragged into a meeting about credentialing and using CRNAs. The anesthesiologist's argument against them was, "Me physician. Me good." Ever see this on Gomer Blog?

https://gomerblog.com/2014/09/bones/

It really sounded something like that, replacing "anesthesiologist good" for bones. I was tempted to drag one of them out of the room and say "Write me a check for $5K and I will handle this for you." A very good argument along the lines of "Even though more expensive in terms of salary, we will save you money in the long run and lead to greater patient satisfaction (key words.)" They just couldn't do that. They could not get past "Physician good."

I said this in a rant post several weeks ago. If you can't effectively sell yourself (read group), you are doomed. Two Ford dealerships in town both sell exactly the same cars. The one with the better sales and marketing succeeds, the other goes bankrupt.

 

[EM Junkie]

Excellent points all around. Our SDG was run by a very good physician and businessman. He couldn’t get past the fact that the administrators couldn’t care less whether we had midlevels or not. He believed we should be a “physician only” practice. All well and good, but when admin wanted a doc at triage, that’s far more expensive than hiring a couple of mid levels. Add to this the financial outlay of staffing 2 underperforming hospital owned FSEDs, and the crushing burden of wanting everyone in network = bye bye SDG.

I still don’t understand how the CMGs get by the Texas laws (don’t know if this is everywhere or not) banning the corporate practice of medicine. Basically, if you’re a physician in Texas your boss cannot be a non physician. AAEM has challenged this, but the CMGs structure things in a way that it’s still allowed.


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[Birdstrike]

Okay. Gloves off.

Just farking admit it. The practice of Medicine has become corporatized and we are cogs in a ---king wheel. It's over. We're cooked. Stick a fork in us. We're done. The Golden Years are gone and they're never comin' back. We lost the war. We've been taken over, conquered and colonized. The bad guys have won. And the only way to survive in enemy territory is to learn the new rules or we cannot survive mentally or physically in this world. The rules for survival are simple, in fact they are very simple. Don't make this harder than it has to be.

Repeat after me: "Medicine business. Businessman boss. Boss not nice. Boss still boss. Keep boss happy have job. Make boss sad no job."

Repeat this out loud ten times after your wake up and ten times before you go to be every day and you'll be a much happier person. Trust me. Print this out and put it on your ED & physician lounge doors. You're welcome.

Sincerely,

Birdstrike M.D.

 

[coachB]

Tried to quote the post asking about Utah.

Yes, there is something very unique there that I have no doubt has been protective of SDGs.

 

[emergentmd]

Medicine is still a great field. EM is still a great field in medicine. This is true relative to many careers and I would say most docs would do it again if they could rewind to their 3rd yr in college.

I would not change anything. I had more options than most premed. I graduated with a computer engineering degree from a top 10 public college. I was one of only 2 students to have a 4.0 GPA starting my 3rd year. I had a paid internship at one of the top 2 chip manufacturers that only took one intern a year which I turned down to pursue medicine. Who knows where I would be if I stuck with being an engineer. I could be making bank at google right now, who knows.

But I don't regret where I am at one bit. The grass is usually brown on the other side.

I still go to work and enjoy what I do. I have more "stuff" and money than the vast majority.

Sure some stuff sucks, but atleast I have control over what I do. If EM ever gets unbearable, I will just cut down my lifestyle and begin the road to semiretirement.

 

[Vandalia]

Okay. Gloves off.

Just farking admit it. The practice of Medicine has become corporatized and we are cogs in a ---king wheel. It's over. We're cooked. Stick a fork in us. We're done. The Golden Years are gone and they're never comin' back. We lost the war. We've been taken over, conquered and colonized. The bad guys have won. And the only way to survive in enemy territory is to learn the new rules or we cannot survive mentally or physically in this world. The rules for survival are simple, in fact they are very simple. Don't make this harder than it has to be.

Repeat after me: "Medicine business. Businessman boss. Boss not nice. Boss still boss. Keep boss happy have job. Make boss sad no job."

Repeat this out loud ten times after your wake up and ten times before you go to be every day and you'll be a much happier person. Trust me. Print this out and put it on your ED & physician lounge doors. You're welcome.

Sincerely,

Birdstrike M.D.

That about summarizes it.

I am old enough to remember the tail end of the days when the "emergency" in "emergency department" actually meant something. When most people would be at home vomiting like crazy for 48 hours waiting for their doctor's office to open Monday morning.

Those days aren't coming back either.

 

[Groove]

I agree that it seems unlikely to “stop their proliferation” at least in the current healthcare environment, but my interest is more on a case by case basis. In other words is it reasonable for a business savvy and motivated group of emergency physicians to push out a CMG say at one hospital or small group of hospitals.

For example, why do you think large democratic groups in Utah have survived for so long? Is there something unique at play there?

I can’t answer that about Utah. Do you have specifics to indicate that there are more SDGs vs CMGs in that state? I would find that doubtful.

If you’re asking why SDGs in that state have prospered for lengths of time, again...I don’t have any insight into that state or the politics at hand. Ask yourself this though...why do you so prefer an SDG? What makes you think you are going to be treated so much more fairly? As I’ve posted before...when you run the numbers, most of the time you are talking about years before you break even and even begin to turn a profit versus your CMG colleagues. (Assuming a sweat equity model.) If you decide to work for one, you take a big risk in that there is absolutely no guarantee they will not be bought out in a few years time. I would go so far as to say that there is an even bigger risk these days compared to years past.

 

[GonnaBeADoc2222]

As a traveler/firefighter/scab (whatever you want to call me) for a CMG, I can tell you why people sometimes choose this job:

-The pay is quite good.
-I get guaranteed hours. This is a huge advantage over locums where every month you may have to scrap together shifts from multiple facilities. In addition, I don't have to deal with locums recruiters, who tbh are some of the slimiest people I've ever talked to.
-I pick the days that I work
-Minimal circadian rhythm disturbances (my shifts are blocked, so when I work nights, I work 5-6 in a row)
-When I have to complete a license/credentialing application, the paperwork is sent to me completed and I review it and sign and send it back. Contrast this to my credentialing experience at my non-CMG side gig which literally took me hours of uncompensated time to complete.

These are the positives. There are multiple downsides which I haven't gotten into.

The location that I live full time is a pretty bad market for EM. "Just move someplace else" is not an option for me as I have familial reasons why I need to be here. I looked at a local community-academic shop - they wanted about 200 more hours a year for about a 50k/yr pay cut. Also looked at a private group which would have required 1 hr commute each way, more hours, and a similar pay cut.

Sure, I'd love to join an SDG in a functional hospital, that treats its pre-partners fairly and has a low risk of CMG takeover - haven't seen any of those where I live.

I have loans to pay, a family to support, kid's education to save for, and a moderate lifestyle to maintain, and this gives me the best way to achieve these goals right now.

 

[TysonCook]

I work for one of the SDG's in Utah. There have been several attempts, but neither us nor our colleagues in the other SDG's are interested. What is being sold is not what you are getting, and if you allow your CS to really look at the data, they agree. Birdstrike and others are correct. You (SDG) must be willing to do the legwork (admin, billing, being involved at all levels of the corporation), and you must have economy of scale. The hard part is the economy of scale and if you have 10 doc's working for your group, I don't think it's survivable. CMG's can have less overhead as they employ their own RCM group, their own malpractice group, and their own disability. Once you add in health, retirement, contract negotiations, etc it's hard to compete as a 10 doc group. If your SDG is 100+ docs, then you can compete. The answer for most is not forming a 10 doc group, but rather a "corporation" of 10 x 10 doc groups. That gives you some leverage.

 

[Birdstrike]

That about summarizes it.

I am old enough to remember the tail end of the days when the "emergency" in "emergency department" actually meant something. When most people would be at home vomiting like crazy for 48 hours waiting for their doctor's office to open Monday morning.

Those days aren't coming back either.

While some might see my assessment as grim or pessimistic, I think expectations play a big role in burnout. If you have realistic expectations and reality meets or exceeds them, you're likely to be happy. If you have unrealistic expectations and reality is worse, you're certain to be disappointed and burnout soon follows. Two persons in the same job: One person is happy and thankful for the positives of their job, the other is feels lied to, depressed and burned out. The only difference was their expectations going in, one realistic, the other naive and unrealistic.

 

[Hamhock]

As a traveler/firefighter/scab (whatever you want to call me) for a CMG, I can tell you why people sometimes choose this job:

-The pay is quite good.
-I get guaranteed hours. This is a huge advantage over locums where every month you may have to scrap together shifts from multiple facilities. In addition, I don't have to deal with locums recruiters, who tbh are some of the slimiest people I've ever talked to.
-I pick the days that I work
-Minimal circadian rhythm disturbances (my shifts are blocked, so when I work nights, I work 5-6 in a row)
-When I have to complete a license/credentialing application, the paperwork is sent to me completed and I review it and sign and send it back. Contrast this to my credentialing experience at my non-CMG side gig which literally took me hours of uncompensated time to complete.

That was a valuable post, especially as you identified as a "scab". This helps give people some insight.

That said:
(each hash mark corresponds to the points quoted above)

- the pay is more for locums, in my experience and to my knowledge than CMG "firefighters"; so this doesn't really apply

- the hours are basically guaranteed with locums, unless the market has dramatically changed in the last two years; so this doesn't really apply

- the days worked are picked with locums too; so this doesn't really apply

- minimal circadian disturbances are one the primary reasons for locums. Not only are shifts choosen in blocks, but often nights can be refused altogether (at least in my experience...I never worked a night shift for locums in the years I did it); so this doesn't really apply

- paperwork...this one definitely applies! There is some extra paperwork and it is a pain in the ass. However, with some organization (multiple paper and electonic copies of all documents needed), this can be overcome to some degree.

So, in my -- admittedly oversimplified -- assessment, the firefighter vs locums comes down to freedom/more money/not hurting the EM doc "market" vs. extra paperwork.

Of course, I haven't worked EM locums for 2-3 years, so things may be way different now (but I doubt it).

HH

 

[Vandalia]

While some might see my assessment as grim or pessimistic, I think expectations play a big role in burnout. If you have realistic expectations and reality meets or exceeds them, you're likely to be happy. If you have unrealistic expectations and reality is worse, you're certain to be disappointed and burnout soon follows. Two persons in the same job: One person is happy and thankful for the positives of their job, the other is feels lied to, depressed and burned out. The only difference was their expectations going in, one realistic, the other naive and unrealistic.

Completely agree.

The advice that I give new physicians - not that they often ask - is to avoid other physicians outside of the hospital. Heck, avoiding them inside the hospital as much as possible is not bad advice. Also, don't live in the "doctor's neighborhood." If you are surrounded by the guy who inherited his dad's plastic surgery practice and is working 20 hours a week making $1M a year, and the "trust babies" who spend all their time flying around the world playing golf, and the millionaire trial lawyer with billboards all over town "Hit by a tractor-trailer?" you are going to think you have the worst job on the planet. On the other hand if you are surrounded by the small business owners working 80 hours a week barely scraping by, and the mid-level executives always looking over their shoulder for someone trying to take their job, you will think you have the best job on the planet.

The other problem is those who don't understand the difference between pay and billing: "I had a plumber charge me $100/hour and he didn't even attend college, and I am only getting paid $200/hour as an EM physician." Yes, and to put it on equal terms, I guarantee that you are billing around $2000/hour. Apples and oranges.

To paraphrase Churchill, who paraphrased someone else, Emergency Medicine is the worst job on the planet, except for all the others...

 

[GonnaBeADoc2222]

That was a valuable post, especially as you identified as a "scab". This helps give people some insight.

That said:
(each hash mark corresponds to the points quoted above)

- the pay is more for locums, in my experience and to my knowledge than CMG "firefighters"; so this doesn't really apply

- the hours are basically guaranteed with locums, unless the market has dramatically changed in the last two years; so this doesn't really apply

- the days worked are picked with locums too; so this doesn't really apply

- minimal circadian disturbances are one the primary reasons for locums. Not only are shifts choosen in blocks, but often nights can be refused altogether (at least in my experience...I never worked a night shift for locums in the years I did it); so this doesn't really apply

- paperwork...this one definitely applies! There is some extra paperwork and it is a pain in the ass. However, with some organization (multiple paper and electonic copies of all documents needed), this can be overcome to some degree.

So, in my -- admittedly oversimplified -- assessment, the firefighter vs locums comes down to freedom/more money/not hurting the EM doc "market" vs. extra paperwork.

Of course, I haven't worked EM locums for 2-3 years, so things may be way different now (but I doubt it).

HH

Oh I wasn't really trying to make that a post a "locums" vs "firefighter" thing. More like a "why firefighter" thing. But to address some of your points:

-Locums pay is decreasing anecdotally. I have not seen any of the $300+ rates from yesteryear, at least not at any non-remote non-dumpster fire sites.
-The demand for locums is decreasing anecdotally as CMGs are ramping up their in house travel groups

I'm not saying these are good things, but they are happening.

My individual decision to be a "firefighter" is not impacting the EM market.

Most locums shifts can be cancelled 30 days out if they find a replacement. If you're in a financial state where you can tolerate large monthly swings in income, locums is probably better. However, as a somewhat young attending, I am not in this position

 

[RustedFox]

I can’t answer that about Utah. Do you have specifics to indicate that there are more SDGs vs CMGs in that state? I would find that doubtful.

If you’re asking why SDGs in that state have prospered for lengths of time, again...I don’t have any insight into that state or the politics at hand. Ask yourself this though...why do you so prefer an SDG? What makes you think you are going to be treated so much more fairly? As I’ve posted before...when you run the numbers, most of the time you are talking about years before you break even and even begin to turn a profit versus your CMG colleagues. (Assuming a sweat equity model.) If you decide to work for one, you take a big risk in that there is absolutely no guarantee they will not be bought out in a few years time. I would go so far as to say that there is an even bigger risk these days compared to years past.

Out of all the options that I had when I was first out of residency, the local SDGs in my present market were the most underhanded, opaque, and obfuscatory.

 

[Fox800]

Out of all the options that I had when I was first out of residency, the local SDGs in my present market were the most underhanded, opaque, and obfuscatory.

Same situation. By and large they have gone away, replaced by CMGs. The two SDGs in my area that I talked to both gave me some flavor of run-around.

 

[GeneralVeers]

Out of all the options that I had when I was first out of residency, the local SDGs in my present market were the most underhanded, opaque, and obfuscatory.

Agreed. I looked at an SDG right out of residency and refused. When they can't tell me how much more the partners make, what it takes to get partnership, and whether or not partnership is guaranteed count me out. In some way the greedy, self-serving nature of partners in these groups is what turned a lot of new grads off and contributed to the rise of CMGs.

 

[emergentmd]

I work for one of the SDG's in Utah. There have been several attempts, but neither us nor our colleagues in the other SDG's are interested. What is being sold is not what you are getting, and if you allow your CS to really look at the data, they agree. Birdstrike and others are correct. You (SDG) must be willing to do the legwork (admin, billing, being involved at all levels of the corporation), and you must have economy of scale. The hard part is the economy of scale and if you have 10 doc's working for your group, I don't think it's survivable. CMG's can have less overhead as they employ their own RCM group, their own malpractice group, and their own disability. Once you add in health, retirement, contract negotiations, etc it's hard to compete as a 10 doc group. If your SDG is 100+ docs, then you can compete. The answer for most is not forming a 10 doc group, but rather a "corporation" of 10 x 10 doc groups. That gives you some leverage.

A larger group obviously has a bigger anchor vs a 10 doctor group which would only survive in the boonies.

What makes all SDG, large or small, vulnerable is finances. The SDG have a much smaller ability to compensate for decrease in income, while the CMG has many more ways to compensate. No different than Walmart vs the mom/pop no matter how personable the mom/pop owners are. Eventually the customers will go where it is the cheapest and walmart can keep prices down much longer than any Mom/pop.

This is and will likely happen to most/all SDGs.

SDG with 100 docs doing well, making alot of $$$, everyone is happy, CS is happy b/c everything is going well and all the medical staff is happy with a well run/competent ER. Docs make 250/hr all in which is above the market where CMGs paying 225/hr all in. Can't get a job with the SDG because no one ever leaves.

Year 1 - Insurance starts to push out high deductible/copay plans and patients start to not pay them. SDG docs now make 240/hr,. still happy
Year 2 - Slowdown in economy, more uninsured/medicaid patient. SDG now makes $230/hr, still happy
Year 3 - Insurance starts to delay payments, contests Emergency Need, deny paments. SDG now makes $220/hr. Docs start to worry, still happy to be independent with similar pay as CMG.
Year 4 - CS opens a Freestanding ER or takes on a crappy Hospital contract and requests SDG to cover it without any stipend. SDG now makes $210/hr. Docs not happy. But volume has gone up and need to hire another another doc, but instead after much debate hires 2 APC which will increase the bottom line. SDG now makes $235/hr. Everyone is happy with income but now have to deal with APCs.
Year 5 - CS sees how good FSERs are for business as a feeder of inpatient admissions. They plan to build 2 more and guess who has to cover it without a stipend. SDG starts to plan for this and decrease MD hours, adds more APC hours. FSERs open up, pay overall goes down but blunted by having 1 less doc and adding 2 more APCs. Pay is now $225/hr. It is much harder to hire good docs vs the CMGs b/c the jobs are essentially the same without the admin headaches. SDG continues to keep the group together relatively easily b/c these entrenched docs love being owners. New docs can care less and just punches the timecard, and do very little Admin work. Most admin work falls on the owners.
Year 6- More headwind. Insurance headwind. Payermix headwind. More FSERs on the horizon. More Metrics to deal with. Billing becomes more expensive to run. SDG owners are all worn down and they start to consider selling out.
Year 7 - CS is tired of paying the hospitalist stipend and CMG comes in with a great proposal. CMG will run the hospitals program without a stipend and thus saving the hospital 5 mil a year. CS goes back to SDG and given their past exceptional care, gives SDG the "opportunity" to keep the ER contract if they run the hospitalist program. $5 mil is essentially the Bonus for the owners and will end up being a $25/hr paycut. The SDG is looking down at the barrel of their pay being $200/hr for Partners. How are they going to attract anyone at that rate? What do they know about running a hospitalist group?
Year 8 - Guess what happens? SDG will not run the hospitalist group and thus will either be terminated or if lucky get "bought" out to keep stability.

Yes. Walmart will eventually put you out of business

 

[EctopicFetus]

Tried to quote the post asking about Utah.

Yes, there is something very unique there that I have no doubt has been protective of SDGs.

Not for long from what I hear.

 

[emergentmd]

I would never join a SDG currently unless their pay for Nonpartners are the same as a CMG.

If a SDG has a lower rate until partnership, requires dedicated Admin "Free" work, requires you to shoulder more holidays/weekends/nights........ I would run to the CMG.

 

[Arcan57]

I agree that it seems unlikely to “stop their proliferation” at least in the current healthcare environment, but my interest is more on a case by case basis. In other words is it reasonable for a business savvy and motivated group of emergency physicians to push out a CMG say at one hospital or small group of hospitals.

No, it's not reasonable. The closest thing to that which is reasonable is opening up a FSED in an underpenetrated, excellent payor-mix environment and extracting 3-5 yrs of pure profit out of it before a major hospital chain decides to plop their FSED next to yours and drink your milkshake. A decent number of ED docs in TX made great money doing this, but that wave has crested.

Your earlier question alluding to in-network is going to be what eventually kills the SDG as a viable model. Right now, in some places, an SDG can negotiate with insurers and if they do well, pull 400-500% of Medicare and if they don't get that tell the insurance company to piss off and charge the patient out of network rates. Hospitals are going to become increasingly intolerant of out of network providers (bad press, costly if the hospital has downside risk, insurance company requiring it, etc) and if they demand we be in-network in order to staff the ED, then our leverage with the insurance companies disappear and we start seeing Medicare (or if life really sucks, below Medicare) level reimbursement. There are some state laws floating around banning balance billing, if I were an insurance company I'd be spending all the money on flooding the airwaves and lining politicos' wallets to make that happen.

CMGs not only extract more money out of patients by capturing charges more effectively, they can afford teams to do the work of negotiating with multiple insurance companies as a large entity that can say "We'll take 300% of Medicare" and not be laughed out of the room. To do that you have to have size. While you can outsource your billing and practice management, you can't (at least currently) outsource the volume to provide negotiating strength. You can band together, but at that point you're basically becoming a CMG and then it's a matter of time before you either lose your contracts or the partners read the writing on the wall and sell to another, larger CMG.

 

[TysonCook]

A larger group obviously has a bigger anchor vs a 10 doctor group which would only survive in the boonies.

What makes all SDG, large or small, vulnerable is finances. The SDG have a much smaller ability to compensate for decrease in income, while the CMG has many more ways to compensate. No different than Walmart vs the mom/pop no matter how personable the mom/pop owners are. Eventually the customers will go where it is the cheapest and walmart can keep prices down much longer than any Mom/pop.

... Walmart will eventually put you out of business

Yes, we've heard it before (many prior posts are similar), and it always is a possibility. But some assumptions made that really shouldn't be are that our CS cares only about bottom line, that CMG's have lower overhead (you can't disregard shareholder ROI), there are no MD's/ EP's on the CS who have a say, that docs only care about the $, and that you may be "forced" to do unprofitable things (e.g. FSED).

At the end of the day, most CMG's answer to a venture capital group, who usually hold for short/medium term. The market expands/contracts and just like any commodity margins will decrease, at which time the venture capitalists will sell, or at least not have the ability to squeeze 20% blood profits out of a stone. If revenue decreases from a standard equation (i.e. balance billing, contracting) then we don't "lose revenue" at the same rate (ie if a SDG needs 6% margin to stay profitable, and a CMG needs 20% to pay dividends and stay profitable - a 50% hit drops our return 3%, while CMG takes a 10% hit). The caveat as already mentioned is economy of scale and where that line become uncomfortable for both. If I'm a venture capitalist, a product with 20% ROI x5yr is a killer deal, but when it drops <10% then I suspect there are other equally profitable ventures that have much less headaches than healthcare.

But to my original statement, this has been an ongoing issue for many years... time will tell.

I would never join a SDG currently unless their pay for Nonpartners are the same as a CMG.

So after you make partner you would be fine still making the same as a CMG rate? As a non partner you make 30% less in the first x months, then at year Y you make 30% more forever. Do the math. The only option that works in this scenario is making you buy into AR lump sum from the beginning, or some variation of this. Additionally, non-partner is a W2 employee, with benefits paid (and tax)... in the end it really is not as big a spread as you'd think (if pulling AR from your pay you may be even less).
Additionally what are you looking for? If you want long term guarantee that you won't put in sweat equity only to "sold" last minute, ask for an acceleration to partnership clause in case of sale of group. But IMHO to say "I want to make a partners rate" is myopic when looking at a long term career. For context, in 40 years only 2 people have not made partner in our group.

 

[namethatsmell]

The alternate title of this thread could be: "why you need to pay off your loans and create an FU fund ASAP."

 

[Hercules]

Yes, we've heard it before (many prior posts are similar), and it always is a possibility. But some assumptions made that really shouldn't be are that our CS cares only about bottom line, that CMG's have lower overhead (you can't disregard shareholder ROI), there are no MD's/ EP's on the CS who have a say, that docs only care about the $, and that you may be "forced" to do unprofitable things (e.g. FSED).

At the end of the day, most CMG's answer to a venture capital group, who usually hold for short/medium term. The market expands/contracts and just like any commodity margins will decrease, at which time the venture capitalists will sell, or at least not have the ability to squeeze 20% blood profits out of a stone. If revenue decreases from a standard equation (i.e. balance billing, contracting) then we don't "lose revenue" at the same rate (ie if a SDG needs 6% margin to stay profitable, and a CMG needs 20% to pay dividends and stay profitable - a 50% hit drops our return 3%, while CMG takes a 10% hit). The caveat as already mentioned is economy of scale and where that line become uncomfortable for both. If I'm a venture capitalist, a product with 20% ROI x5yr is a killer deal, but when it drops <10% then I suspect there are other equally profitable ventures that have much less headaches than healthcare.

But to my original statement, this has been an ongoing issue for many years... time will tell.


So after you make partner you would be fine still making the same as a CMG rate? As a non partner you make 30% less in the first x months, then at year Y you make 30% more forever. Do the math. The only option that works in this scenario is making you buy into AR lump sum from the beginning, or some variation of this. Additionally, non-partner is a W2 employee, with benefits paid (and tax)... in the end it really is not as big a spread as you'd think (if pulling AR from your pay you may be even less).
Additionally what are you looking for? If you want long term guarantee that you won't put in sweat equity only to "sold" last minute, ask for an acceleration to partnership clause in case of sale of group. But IMHO to say "I want to make a partners rate" is myopic when looking at a long term career. For context, in 40 years only 2 people have not made partner in our group.

I think you misunderstood their point. I don’t think they were saying partners and nonpartners should make the same. They were saying that it’s safer to join an SDG where the prepartner pay is higher than the local CMG pay. I couldn’t agree more. In that situation you have likely lost nothing even if the group does get bought out before you make partner. It also speaks very well of the financial stability and business acumen of the group if they are running it in such a way that the prepartners are out-earning their CMG counterparts.


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[emergentmd]

Yes, we've heard it before (many prior posts are similar), and it always is a possibility. But some assumptions made that really shouldn't be are that our CS cares only about bottom line, that CMG's have lower overhead (you can't disregard shareholder ROI), there are no MD's/ EP's on the CS who have a say, that docs only care about the $, and that you may be "forced" to do unprofitable things (e.g. FSED).

At the end of the day, most CMG's answer to a venture capital group, who usually hold for short/medium term. The market expands/contracts and just like any commodity margins will decrease, at which time the venture capitalists will sell, or at least not have the ability to squeeze 20% blood profits out of a stone. If revenue decreases from a standard equation (i.e. balance billing, contracting) then we don't "lose revenue" at the same rate (ie if a SDG needs 6% margin to stay profitable, and a CMG needs 20% to pay dividends and stay profitable - a 50% hit drops our return 3%, while CMG takes a 10% hit). The caveat as already mentioned is economy of scale and where that line become uncomfortable for both. If I'm a venture capitalist, a product with 20% ROI x5yr is a killer deal, but when it drops <10% then I suspect there are other equally profitable ventures that have much less headaches than healthcare.

But to my original statement, this has been an ongoing issue for many years... time will tell.


So after you make partner you would be fine still making the same as a CMG rate? As a non partner you make 30% less in the first x months, then at year Y you make 30% more forever. Do the math. The only option that works in this scenario is making you buy into AR lump sum from the beginning, or some variation of this. Additionally, non-partner is a W2 employee, with benefits paid (and tax)... in the end it really is not as big a spread as you'd think (if pulling AR from your pay you may be even less).
Additionally what are you looking for? If you want long term guarantee that you won't put in sweat equity only to "sold" last minute, ask for an acceleration to partnership clause in case of sale of group. But IMHO to say "I want to make a partners rate" is myopic when looking at a long term career. For context, in 40 years only 2 people have not made partner in our group.

I would say the chance of making more $$ with a CMG is better than doing sweat equity with hopes of making more 2+ yrs later in the long run. If a doc understands the risks of making less now with the possibility of making more later, then by all means.

But I would bet 3/4 of the times you will have a negative monetary outcome going the SDG sweat equity route. Now if prepartner makes very similar to a CMG then by all means. But that is usually not the case

 

[hundreddaysoff]

At the end of the day, most CMG's answer to a venture capital group, who usually hold for short/medium term. The market expands/contracts and just like any commodity margins will decrease, at which time the venture capitalists will sell, or at least not have the ability to squeeze 20% blood profits out of a stone.

What effect does a VC selling a CMG have on the CMG? Do they then lose some contracts to the benefit of leaner SDGs/CMGs until their (the CMG's) returns improve? Is this all theoretical or are there historical examples?

 

[SeasideDoc]

The hospital I'm at is on their 4th group in 5 years. 3 of them CMGs, and one was a small corporation run by two guys. Seems these groups keep making the same promises to "fix" the system issues and convince the CEOs to change the contract.

GV, how is the most recent CMG at your hospital making on that promise? Did they finally "fix" the system issues?

 

[EctopicFetus]

I think you misunderstood their point. I don’t think they were saying partners and nonpartners should make the same. They were saying that it’s safer to join an SDG where the prepartner pay is higher than the local CMG pay. I couldn’t agree more. In that situation you have likely lost nothing even if the group does get bought out before you make partner. It also speaks very well of the financial stability and business acumen of the group if they are running it in such a way that the prepartners are out-earning their CMG counterparts.


Sent from my iPhone using SDN mobile

This X100. First SDG I joined i made about 60% of local CMG rates. I had options whereby I could get that number to about 80% which I did. Then after 2 years I made partner. After about 5.5 years there my group sold.

I started looking for another job. A few SDG options but all at the “old school” make less than a CMG model. I was too in tune with the markets and understood that this was way way too risky. I started looking around and found another SDG in another part of the country. I would make about 50% above the national CMG rate as a non partner and then even more.

The delta between partners and non partners is about 15% whereby it makes a non partner position the 2nd best job in town (behind being a partner).

SDGs need to adapt to this model not because they cant find someone to fill their SDG position but you run the risk of only hiring docs with no business sense and frankly doing what is right.

Much of what has been said on here is right but the belief that CMG have some magic power to “bill better” is foolish. Their RCM generally sucks but they do have good national contracts. That being said thats about to change. The United / Envision thing should be a sign of whats to come. While the big boys can contract nationally the downside is it makes it much harder for them to be OON on a national level. Therefore they may have to contract with everyone (and therefore make less).

Re OON Trump et al announced they were gonna tackle this I would discuss with our California folks how their BB law affected them.

The leverage in a negotiation with insurers comes from how much your hospital is willing to lean on the insurers and allow you to be OON if you dont get a good deal. The modern healthcare article on this wasn’t terribly illuminating. That being said I find being OON distasteful but its the only recourse when insurance companies with fat profits dont want to be reasonable.

 

[EctopicFetus]

Also, there are hospitals mainly in the NE who are dumping their CMGs and their own employed EM docs in favor of SDGs. There is always ebb and flow and IMO docs should be banding together to take back their ED contracts. The typical contracts make this hard but IMO still the best course of action.

On the financial side the belief that CMGs with their regional directors, layers of marketing etc are somehow more efficient than a group of docs is insane. Their lone advantage is in contracting but there are ways around that. You have to yourself have some semblance of scale or influence (only hospital in a town).

If you are:
1) a smallish volume ED
2) in a big city
3) lots of other EDs around
4) dont have specialty services in your hospital

You are probably gonna have no luck in getting a decent contract. OTOH if you have some size, some local size, have good docs, engage with the hospital and try to solve their pain points you will be fine..... until there is change in the C suite.

 

[Hercules]

Agree with everything EctopicFetus said. My SDG is very similar to his current one in our approach. Our prepartner docs make more than all of the CMG spots in the area. Our partners make significantly more than the CMGs. It makes our job the most desirable in town and the area which helps us with recruiting. We run a tight ship and have a great relationship with both our C suite and our consultants. We stay active within the hospital and keep members of our group on the hospital board and chair several committees. We can and do outcompete CMGs. My biggest concern would be having the hospital get bought out or having a major change in our C suite as an incoming management team can always mess things up without reason.


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[Groove]

50%+ more than local CMG rate? Ectopic, you’re group must have one fat hospital subsidy. I can’t imagine admin wouldn’t be interested in a CMG willing to work without one.

 

[TooMuchResearch]

The one thing that these contract management groups are good at compared to the democratic groups is billing and paper work. A small group of 10 doctors will have a hard time maximizing billing across multiple insurance companies compared to a national contract management group. That's why physicians at CMG's can sometimes make more money than working with a SDG.

Our group uses a third party coding/billing company so presumably they're good at it.

How small does one need to be to maintain the presumption of Small democratic group?

 

[TooMuchResearch]

I work for one of the SDG's in Utah. There have been several attempts, but neither us nor our colleagues in the other SDG's are interested. What is being sold is not what you are getting, and if you allow your CS to really look at the data, they agree. Birdstrike and others are correct. You (SDG) must be willing to do the legwork (admin, billing, being involved at all levels of the corporation), and you must have economy of scale. The hard part is the economy of scale and if you have 10 doc's working for your group, I don't think it's survivable. CMG's can have less overhead as they employ their own RCM group, their own malpractice group, and their own disability. Once you add in health, retirement, contract negotiations, etc it's hard to compete as a 10 doc group. If your SDG is 100+ docs, then you can compete. The answer for most is not forming a 10 doc group, but rather a "corporation" of 10 x 10 doc groups. That gives you some leverage.

Yes, I think size is helping us. We're now 100+ physicians and I'd guess 30+ PA-Cs and a few scattered NPs.

 

[TooMuchResearch]

Not for long from what I hear.

Oh?