Counterpoint: Smaller Health Systems Carry Less Risk
The rush into consolidation that swept the health care industry in advance of the Affordable Care Act's implementation is understandable.
Specialty practices anticipating more fearsome regulation have sought the protective legal eaves of larger health care organizations. Health systems eager to brand themselves as best in class Accountable Care Organizations have happily acquired smaller groups.
But with larger size comes more risk. The ACA will bring tens of millions of patients -- patients with scanty medical histories in some cases -- into the health care system. There is going to be a tremendous amount of rub as these new patients become acquainted with better and more frequent health care, and as health care providers in turn learn to effectively treat these new patients.
High incidence of obesity and diabetes in this undertreated segment of the population will create new risks for hospitals. The annual national health care cost connected to diabetes is currently running around $245 billion. Existing transportation and other facilities may be inadequate for heavier patients.
At the same time, with its emphasis on health care outreach and preventive care, the Affordable Care Act will undoubtedly result in lower in-patient revenue for hospitals, at a time when they can least afford such a revenue hit.
More doctors treating more patients under one risk management umbrella also means a concentration of medical malpractice risk. In 2011 alone, there were 90 health care acquisitions with a total value of some $10 billion.
Hospital administrators will be hard-pressed to know, going in, whether the performance standards of the acquired physicians are in line with those of the larger health organization.
Communication breakdowns in hospitals can have disastrous consequences. Isn't it highly likely that as one health care culture merges with another that communication breakdowns will follow?
Larger numbers of smaller health care provider organizations bifurcate the risk, instead of aggregating it. More facile care coordination in the smaller organizations mean better quality of care, fewer mistakes and fewer risk exposures.
Remember the good old days when your family doctor, whom you had known all of your life, came to your front door to treat you?
This is not an exercise in blind nostalgia. Where health care risk is concerned, those were the good old days.
--Dan Reynolds is editor-in-chief of Risk & Insurance®. He can be reached at firstname.lastname@example.org.
October 15, 2013
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