By George F. Indest III, J.D., M.P.A., LL.M., Board Certified by The Florida Bar in Health Law
According to The Physicians Foundation, a nonprofit organization that seeks to advance the work of physicians, one of the biggest concerns of practicing doctors is the continuing acquisition of small practices by hospitals and medical groups. On April 4, 2013, a new group called the Association of Independent Doctors met for the first time in Orlando, Florida. The group is made up of 80 independent Florida physicians. Its mission is to raise awareness about the growing number of physicians’ practices being bought up by hospitals and medical groups. The association also hopes to show how these mergers affect the health care system, according to the Orlando Sentinel.
To read the entire article from the Orlando Sentinel, click here.
Acquisitions of Private Practices are a Nationwide Trend in the Health Care Industry.
Since January 2013, at least 114 independent Orlando doctors have merged with a hospital system, according to the Orlando Sentinel. On January 1, 2013, two major acquisitions took place in Central Florida. Florida Hospital purchased Florida Heart Group and its 19 formerly independent doctors. (Click here to read more on this story.) Also, Orlando Health, Inc., a large Orlando-based hospital system, bought Physician Associates, the largest independent group of physicians in the area. Physician Associates was made up of 95 mostly primary care doctors. (Click here to read a blog on this story.)
According to the Orlando Sentinel, thirty-nine percent (39%) of doctors nationwide are on their own. This percentage is down from fifty-seven percent (57%) of doctors who were independent in 2000. The main reason behind mergers cited by doctors is the cost of running a practice. I previously blogged about this nationwide trend. Click here to read that blog.
Association of Independent Doctors Hopes to Keep the Practice of Medicine Between Doctors and Patients.
The Association of Independent Doctors indicates that it believes that patients will suffer as the number of independent physicians continues to shrink. According to a New York Times article, patients often don’t realize that their physician has become a hospital employee until they receive a bill. The article states that as physicians are absorbed into hospital systems, they can get paid for services at the hospital systems’ rates, which are typically higher than what insurers pay to independent doctors. Some services that physicians previously performed at their facilities may start to be billed as hospital outpatient procedures, this can double or triple the cost. The Association of Independent Doctors also believes that this trend will control referrals. Click here to read the entire New York Times article.
The Association of Independent Doctors is the first group of its kind in the state of Florida. However, group members say they are aware of other such organizations in Georgia and Tennessee.
Contact Health Law Attorneys Experienced in Business Transactions and Contracts.
At the Health Law Firm we represent physicians negotiating contracts, physicians in disputes with hospitals and physicians forming or desiring to leave medical groups. Our attorneys provide legal services for all health care providers and professionals. This includes physicians, nurses, dentists, psychologists, psychiatrists, mental health counselors, Durable Medical Equipment suppliers, medical students and interns, hospitals, ambulatory surgical centers, pain management clinics, nursing homes, and any other health care provider. We represent facilities, individuals, groups and institutions in contracts, sales, mergers and acquisitions.
The services we provide include reviewing and negotiating contracts, business transactions, professional license defense, representation in investigations, credential defense, representation in peer review and clinical privileges hearings, Medicare and Medicaid audits, commercial litigation, and administrative hearings.
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What do you think of the mergers between hospitals and independent physicians? As an independent physician, would you consider merging with a medical group or hospital? As a doctor part of a hospital system, what are the benefits and what are drawbacks? Please leave any thoughtful comments below.
Jameson, Marni. “Independent Doctors Unite to Fight National Trend Toward Hospitals Buying Physician Groups.” Orlando Sentinel. (April 3, 2013). From: http://www.orlandosentinel.com/health/os-doctors-unite-20130403,0,4558664.story
Punke, Heather. “Independent Physicians in Florida Unite to Fight Acquisition Trend.” Becker’s Hospital Review. (April 4, 2013). From: http://www.beckershospitalreview.com/hospital-physician-relationships/independent-physicians-in-florida-unite-to-fight-acquisition-trend.html
Creswell, Julie and Abelson, Reed. “A Hospital War Reflects a Bind for Doctors in the U.S.” The New York Times. (November 30, 2012) From: http://www.nytimes.com/2012/12/01/business/a-hospital-war-reflects-a-tightening-bind-for-doctors-nationwide.html?pagewanted=all&_r=0
About the Author: George F. Indest III, J.D., M.P.A., LL.M., is Board Certified by The Florida Bar in Health Law. He is the President and Managing Partner of The Health Law Firm, which has a national practice. Its main office is in the Orlando, Florida, area. www.TheHealthLawFirm.com The Health Law Firm, 1101 Douglas Ave., Altamonte Springs, FL 32714, Phone: (407) 331-6620.
Tag Words: hospital acquisition, medical group acquisition, private practice mergers, medical groups, Orlando Health, Physician Associates, reviewing and negotiating contracts, business transactions, physician, physicians negotiating contracts, physician disputes, physician forming a medical group, physician leaving a medical group, physician joining a medical group, physician joining a hospital, physician leaving a hospital, Florida hospital, Florida Heart Group Florida, health care lawyer, Florida health care attorney, contract attorney, contract lawyer, physician contract lawyer, physician contract attorney, sale of practice, closing attorney, merger legal counsel
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