Joint-Venture Ambulatory Surgery Centers: The Perfect Partnership.

BACKGROUND: Ambulatory surgery growth has increased in the last few decades as ambulatory surgery centers have been shown to succeed in cost efficiencies through their smaller size and breadth, specialization of care, and ability to quickly participate in perioperative process improvement and education. METHODS: A 5-year retrospective fiscal review was performed for all Northwell Health-physician ambulatory surgery center joint ventures. The outcome measures studied included model of ownership, specialty types, and gross revenue. Additional facility characteristics were studied, including growth trajectory, facility size, and cost to build a de novo facility. RESULTS: Eleven free-standing ambulatory surgery centers were identified at Northwell Health during the 5-year study period. The total gross revenue for all Northwell clinical joint ventures for 2019 alone was $102,854,000. Northwell Health is a majority stakeholder in eight of their joint venture ambulatory surgery centers, with an average Northwell ownership of 53 percent and an average number of physician owners per facility of 11. The number of hospital-physician joint-venture ambulatory surgery centers grew from two to 11 facilities during the study period (450 percent). Surgical volume followed a similar trajectory, increasing 295 percent over the same time period. CONCLUSIONS: The ambulatory surgery center setting provides a vast number of possibilities for key stakeholders, including patients themselves, to benefit from financial and clinical efficiencies. Ambulatory surgery centers have been popular, as they meet patient expectations for convenience of elective surgery, reduce payer and clinical pressures to minimize length of stay in hospitals, and achieve similar or higher quality care with less intense resources.

Do accountable care organizations differ according to physician-hospital integration?: A retrospective observational study.

ABSTRACT: Physician-hospital integration among accountable care organizations (ACOs) has raised concern over impacts on prices and spending. However, characteristics of ACOs with greater integration between physicians and hospitals are unknown. We examined whether ACOs systematically differ by physician-hospital integration among 16 commercial ACOs operating in Massachusetts.Using claims data linked to information on physician affiliation, we measured hospital integration with primary care physicians for each ACO and categorized them into high-, medium-, and low-integrated ACOs. We conducted cross-sectional descriptive analysis to compare differences in patient population, organizational characteristics, and healthcare spending between the three groups. In addition, using multivariate generalized linear models, we compared ACO spending by integration level, adjusting for organization and patient characteristics. We identified non-elderly adults (aged 18-64) served by 16 Massachusetts ACOs over the period 2009 to 2013.High- and medium-integrated ACOs were more likely to be an integrated delivery system or an organization with a large number of providers. Compared to low-integrated ACOs, higher-integrated ACOs had larger inpatient care capacity, smaller composition of primary care physicians, and were more likely to employ physicians directly or through an affiliated hospital or physician group. A greater proportion of high-/medium-integrated ACO patients lived in affluent neighborhoods or areas with a larger minority population. Healthcare spending per enrollee in high-integrated ACOs was higher, which was mainly driven by a higher spending on outpatient facility services.This study shows that higher-integrated ACOs differ from their counterparts with low integration in many respects including higher healthcare spending, which persisted after adjusting for organizational characteristics and patient mix. Further investigation into the effects of integration on expenditures will inform the ongoing development of ACOs.

Hospital-physician integration and Medicare's site-based outpatient payments.

OBJECTIVE: To determine the relationship between Medicare's site-based outpatient billing policy and hospital-physician integration. DATA SOURCES: National Medicare claims data from 2010 to 2016. STUDY DESIGN: For each physician-year, we calculated the disparity between Medicare reimbursement under hospital ownership and under physician ownership. Using logistic regression analysis, we estimated the relationship between these payment differences and hospital-physician integration, adjusting for region, market concentration, and time fixed effects. We measured integration status using claims data and legal tax names. DATA COLLECTION: The study included integrated and non-integrated physicians who billed Medicare between January 1, 2010, and December 31, 2016 (n = 2 137 245 physician-year observations). PRINCIPAL FINDINGS: Medicare reimbursement for physician services would have been $114 000 higher per physician per year if a physician were integrated compared to being non-integrated. Primary care physicians faced a 78% increase, medical specialists 74%, and surgeons 224%. These payment differences exhibited a modest positive relationship to hospital-physician vertical integration. An increase in this outpatient payment differential equivalent to moving from the 25th to 75th percentile was associated with a 0.20 percentage point increase in the probability of integrating with a hospital (95% CI: 0.0.10-0.30). This effect was slightly larger among primary care physicians (0.27, 95% CI: 0.18 to 0.35) and medical specialists (0.26, 95% CI: 0.05 to 0.48), while not significantly different from zero among surgeons (-0.02; 95% CI: -0.27 to 0.22). CONCLUSIONS: The payment differences between outpatient settings were large and grew over time. Even routine annual outpatient payment updates from Medicare may prompt some hospital-physician vertical integration, particularly among primary care physicians and medical specialists.

A Novel, Synergistic Model in Total Joint Arthroplasty: A Report of 2 Specialty Hospitals With Joint Ownership Between Physicians and Healthcare Systems.

BACKGROUND: In 2010, the Affordable Care Act introduced new restrictions on the expansion of physician-owned hospitals (POHs) due to concerns over financial incentives and increased costs. The purpose of this study is to determine whether joint ventures between tertiary care and specialty hospitals (SHs) allowing physician ownership (POHs) have improved outcomes and lower cost following THA and TKA. METHODS: After institutional review board approval, a retrospective review of consecutive series of primary THA and TKA patients from 2015 to 2016 across a single institution comprised of 14 full-service hospitals and 2 SHs owned as a joint venture between physicians and their health system partners. Ninety-day episode-of-care claims cost data from Medicare and a single private insurer were reviewed with the collection of the same demographic data, medical comorbidities, and readmission rates for both the SHs and non-SHs. A multivariate regression analysis was performed to determine the independent effect of the SHs on episode-of-care costs. RESULTS: Of the 6537 patients in the study, 1936 patients underwent a total joint arthroplasty at an SH (29.6%). Patients undergoing a procedure at an SH had shorter lengths of stay (1.29 days vs 2.23 days for Medicare, 1.15 vs 1.86 for private payer, both P < .001), were less likely to be readmitted (4% vs 7% for Medicare, P = .001), and had lower mean 90-day episode-of-care costs ($16,661 vs $20,579 for Medicare, $26,166 vs $35,222 for private payers, both P < .001). When controlling for the medical comorbidities and demographic variables, undergoing THA or TKA at an SH was associated with a decrease in overall episode costs ($3266 for Medicare, $13,132 for private payer, both P < .001). CONCLUSION: Even after adjusting for a healthier patient population, the joint venture partnership with health systems and physician-owned SHs demonstrated lower 90-day episode-of-care costs than non-SHs following THA and TKA. Policymakers and practices should consider these data when considering the current care pathways.

Economic evaluation of the impact of physician-hospital integration and physician boards on hospital expenditure per patient: A 5-year longitudinal study.

BACKGROUND: This study aims to contribute to the ongoing policy and scholarly debate on physician-hospital integration (INT) and health care cost by providing evidence for the role of physician boards in mitigating hospital expenditure associated with INT. METHODS: We conducted our study of the relationship between INT, physician boards, and hospital expenditure using data on hospitals in California. We obtained data from the Centers for Medicare and Medicaid Services, American Hospital Association, and California Office of Statewide Health Planning and Development from 2002 to 2006. A hospital fixed-effect ordinary least square (OLS) regression analysis was used. RESULTS: Hospital expenditure was higher in a hospital with an integrated arrangement (e.g., a hospital that adopted an integrated salary model) than under other independent arrangements between physicians and hospitals, and the proportion of physician members on hospital boards negatively moderated the effect of integration on hospital expenditure. CONCLUSIONS: Physician boards may provide a context that affords benefits that can reduce hospital expenditures under INT. This finding highlights the importance to having a supportive organizational design when implementing INT.

rampingup for bundled payments: fostering hospital-physician alignment.

When hospitals embark on bundled payment programs, they should take steps to ensure physicians are on board. Key steps include: Contacting physicians while in the planning stages so they can prepare to participate in the new model. Establishing resources and processes designed to make compliance easier. Educating physicians about the importance of coding and documentation.

Assembled Products: The Key to More Effective Competition And Antitrust Oversight in Health Care.

This Article argues that recent calls for antitrust enforcement to protect health insurers from hospital and physician consolidation are incomplete. The principal obstacle to effective competition in health care is not that one or the other party has too much bargaining power, but that they have been buying and selling the wrong things. Vigorous antitrust enforcement will benefit health care consumers only if it accounts for the competitive distortions caused by the sector's long history of government regulation. Because of regulation, what pass for products in health care are typically small process steps and isolated components that can be assigned a billing code, even if they do little to help patients. Instead of further entrenching weakly competitive parties engaged in artificial commerce, antitrust enforcers and regulators should work together to promote the sale of fully assembled products and services that can be warranted to consumers for performance and safety. As better products emerge through innovation and market entry, competition may finally succeed at lowering medical costs, increasing access to treatment, and improving quality of care.

How Medicare preventive services can bolster the hospital-physician enterprise.

Medicare preventive services offer hospital-owned physician practices an opportunity to increase revenue.

Association of Financial Integration Between Physicians and Hospitals With Commercial Health Care Prices.

IMPORTANCE: Financial integration between physicians and hospitals may help health care provider organizations meet the challenges of new payment models but also may enhance the bargaining power of provider organizations, leading to higher prices and spending in commercial health care markets. OBJECTIVE: To assess the association between recent increases in physician-hospital integration and changes in spending and prices for outpatient and inpatient services. DESIGN, SETTING, AND PARTICIPANTS: Using regression analysis, we estimated the relationship between changes in physician-hospital integration from January 1, 2008, through December 31, 2012, in 240 metropolitan statistical areas (MSAs) and concurrent changes in spending. Adjustments were made for patient, plan, and market characteristics, including physician, hospital, and insurer market concentration. The study population included a cohort of 7,391,335 nonelderly enrollees in preferred-provider organizations or point-of-service plans included in the Truven Health MarketScan Commercial Database during the study period. Data were analyzed from December 1, 2013, through July 13, 2015. EXPOSURE: Physician-hospital integration, measured using Medicare claims data as the share of physicians in an MSA who bill for outpatient services with a place-of-service code indicating employment or practice ownership by a hospital. MAIN OUTCOMES AND MEASURES: Annual inpatient and outpatient spending per enrollee and associated use of health care services, with utilization measured by price-standardized spending (the sum of annual service counts multiplied by the national mean of allowed charges for the service). RESULTS: Among the 240 MSAs, physician-hospital integration increased from 2008 to 2012 by a mean of 3.3 percentage points, with considerable variation in increases across MSAs (interquartile range, 0.8-5.2 percentage points). For our study sample of 7,391,335 nonelderly enrollees, an increase in physician-hospital integration equivalent to the 75th percentile of changes experienced by MSAs was associated with a mean increase of $75 (95% CI, $38-$113) per enrollee in annual outpatient spending (P < .001) from 2008 to 2012, a 3.1% increase relative to mean outpatient spending in 2012 ($2407 [95% CI, $2400-$2414] per enrollee). This increase in outpatient spending was driven almost entirely by price increases because associated changes in utilization were minimal (corresponding change in price-standardized spending, $14 [95% CI, -$13 to $41] per enrollee; P = .32). Changes in physician-hospital integration were not associated with significant changes in inpatient spending ($22 [95% CI, -$1 to $46] per enrollee; P = .06) or utilization ($10 [95% CI, -$12 to $31] per enrollee; P = .37). CONCLUSIONS AND RELEVANCE: Financial integration between physicians and hospitals has been associated with higher commercial prices and spending for outpatient care.

Costs of Physician-Hospital Integration.

Given that the enactment of the Patient Protection and Affordable Care Act of 2010 is expected to generate forces toward physician-hospital integration, this study examined an understudied, albeit important, area of costs incurred in physician-hospital integration. Such costs were analyzed through 24 semi-structured interviews with physicians and hospital administrators in a multiple-case, inductive study. Two extreme types of physician-hospital arrangements were examined: an employed model (ie, integrated salary model, a group of physicians integrated by a hospital system) and a private practice (ie, a physician or group of physicians who are independent of economic or policy control). Interviews noted that integration leads to 3 evident costs, namely, monitoring, coordination, and cooperation costs. Improving our understanding of the kinds of costs that are incurred after physician-hospital integration will help hospitals and physicians to avoid common failures after integration.

Economic Impact of Orthopedic Adult Reconstruction Office Practice: The Implications of Hospital Employment Models on Local Economies.

The purpose of this study was to evaluate the economic attributes of private practice adult reconstruction (AR) offices. 458 AAHKS surgeons responded; 65% were in private practice (fee-for-service, non-salaried, non-employed AR surgeons). 54% had considered hospital employment in the past two years. The average group employs 13.4 orthopedic surgeons (3.4 AR), and 105 other employees. The average total budget is $12.5 million per year with $4 million in salaries, and $238,000 in tax revenue generated. Co-management joint ventures are a better model than hospital employment for aligning AR surgeons and hospitals and realizing the cost effectiveness and quality improvement goals of PPACA and AARA while preserving the economic impact of AR private practice.