The Hospitalist Blog

To be honest I am not entirely clear as to exactly what the Obama plan is for Healthcare reform. But it appears to me that there are at least three key areas of emphasis. He would like to provide universal Insurance coverage for the more than 47 million uninsured Americans. He wants to be sure that whatever healthcare reform is enacted, that it focuses on a system that pays for quality while at the same time lowers the overall cost of care. I believe all three goals are right on target. 

The promise of the hospitalist movement is for better quality of care and at a reduced cost. A perfect new innovation for a changing healthcare landscape. Now that we have seen the dramatic increase in Hospitalist care documented in the recent issue of the NEJM we can focus our training programs on producing this new kind of doctor. Studies to date have only shown a modest reduction in cost. But it is clear that a well trained “true” hospitalist produces excellent results. The best Hospitalists understand that their role extends beyond the medical needs of the patient and extend to leadership roles in driving the hospital care to better practices.  At IPC we document our lower lengths of stay that are coupled with readmission rates at half the national norm.  Great quality at a reduced cost produced by hospitalists will be a perfect part of the Obama Solution.  

I am clearly in favor of access to care for everyone. The Obama drive to insure everyone will be good for Hospitalists everywhere. At IPC it will mean that the 7% of our patients that we provide free care for will now have resources to pay us.  We will make more money and continue to be able to pay our providers above average incomes. Maybe more importantly we can enhance many of educational programs that we built to fill the gap created by the lack of Hospitalist training in our nations Internal Medicine programs. To many others in the Hospitalist industry they will be able to reduce the burden they have placed on hospitals and require less subsidization.   

There is one word of caution in the quest for Universal coverage. We must consider that simply insuring everyone will not guarantee the real goal of universal access to care. We have a crisis brewing. There are not enough primary care doctors to care for all of these patients. We already have a shortage of doctors. This plan will give 47 million more people coverage for care. We have millions of baby boomers about to hit the Medicare ranks. 28,000 or nearly a quarter of all Internists have left primary care to become Hospitalists and there is a need for 12,000 more. The concept of the medical home makes matters worse as at its core it calls for primary care doctors to reduce their patient load to have more time to focus on disease prevention. Our training programs are instilling the myth in our young doctors that caps on their productivity are necessary at levels that cannot be sustained in reality or financially. I have one question, Who the heck is going to see all of these patients?  If we do not address the shortage of doctors before we do these reforms we will replace the issue of universal coverage with universal access problems.  

The good news for Hospitalists is that the need for our services will never be greater under the Obama plan and we will increasingly be asked to take a seat at the table as our healthcare system gets reengineered. The very essence of a great Hospitalist!

 

A recently released study by the American Hospital Association confirms of nearly 5,000 community hospitals confirms what many of us have already understand. The “penetration ratio” of community hospitals that utilize hospitalists is 58%; for those facilities over 200 beds the ratio jumps to 83%. 

Less well understood is the penetration of hospitalists into other inpatient facilities. At IPC we now have practice groups established in pediatric hospitals, rehabilitation facilities, long-term acute care facilities and skilled nursing facilities all across the country. Each facility type has its own dynamic and challenge, but the demand for hospitalist services at these facilities is growing at a rapid rate.  

It looks to me like the opening of a new frontier. Penetration is still in its early phases, but this trend will open up new vistas for hospitalists, creating opportunities to “follow” patients as they transition care from one facility type to another. It seems to me that non-acute penetration today is about where  acute care was five or six years ago.  

The fact that hospitalists are providing services to such a wide variety of facility types is a testament to the tremendous flexibility and adaptability our specialty is capable of offering to the inpatient care system as our specialty continues to evolve. There is virtually no inpatient care setting in which hospitalists cannot, should not or will not practice. Perhaps, at the end of the day, this is our greatest strength.

 

Third in a 3-part series on hospitalists and the economic crisis 

As pressure mounts on physician practices to cope with the economic crisis, all options are being put on the table. One option for practices to maximize the present value of their practice as well as their ongoing career is to sell their practice to a larger group such as IPC where the resources to whether the financial storm are already in place. But some practices, perhaps not understanding the range of better alternatives, have exhibited an interest in selling or even giving away their practice to a hospital. A recent survey from the American Hospital Association titled “Report on the Economic Crisis: Initial Impact on Hospitals” corroborates a small but discernable trend in this direction. Recent data from The Advisory Board Company also indicates that the number of physicians willing to consider hospital employment seems to be on the upswing. This trend is more pronounced in the surgical specialties but it is reasonable to assume that the trend involves hospitalists to some extent.  

Acting on impulse to seek refuge from the economic crisis by turning to hospital employment will not be a panacea for what ails some hospitalist practices, for several reasons. First, a hospital’s decision to employ physicians may be viewed in itself as a short-term expediency. With but a few exceptions, hospitals have neither the funding nor the organizational structure needed to sustain and nurture the development of a hospitalist practice over the long term. Second, for a hospital to fund a practice group from the inside requires a level of subsidization even greater that what is required to contract with most groups in private practice. Hospitals may be willing to accept lower levels of productivity from employed physicians as the short-term price they pay for securing additional coverage and control, but here again, the economics of this arrangement do not work in the hospital’s favor over the long term. Third and perhaps most important, the successful practice of hospital medicine require a degree of autonomy that many hospitals in the role of employer find difficult to accommodate. This in turn leads to conflicts of interest and misalignment of goals that sooner or later always seem to surface.

My experience tells me that physicians perform best for their hospital and their patients when they are working for other physicians. In challenging times it is especially important to take the long view. Over many years the private practice group has stood the test of time, and it has proven itself to be the most enduring organization for practicing medicine through strong and weak economic conditions.

 

Second of a 3-part series on how the economic crisis affects hospitalists

Look at the two Chinese symbols above. The symbol on the left is the symbol for danger. The symbol on the right is the symbol for opportunity. Taken together, they form the Chinese symbol for crisis. Leave it to 5,000 years of Chinese wisdom to perfectly describe the credit crisis now facing hospitals and how it will impact hospitalists.

If you need a little rousting from that warm blanket of security you feel walking down the hospital hallways, then take a look at some recent headlines. On October 15, 2008 The New York Times ran a story titled “Disappearing Credit Forces Hospitals to Delay Improvements.”

On October 27, 2008, Healthleaders magazine, a publication for hospital and healthcare executives, ran a story titled “Dealing with the Credit Conundrum.”

Still comfortable? Here are a few more data points: Universal Health Services’ interest payments alone represent over a fifth of their net income in the last quarter reported. Their Standard and Poors credit rating is BBB- which is just above junk bond status. And they’re the ones doing well. Tenet Healthcare reported a 2nd quarter loss of $13 million and spent $98 million on interest alone. Their credit rating is B, which is well within the junk bond category. Health Management Associates this week announced a drop of 79% in their 3rd quarter profits. Credit rating B+, also junk bond status.

The credit crisis has already arrived for the hospitals. Does that pose a danger for hospitalists? According to the SHM’s 2008 survey, hospitalists are subsidized by their hospitals by an average of $97,000. SHM does not break down this figure by employment type although I would think this would be useful. My guess would be that the subsidy figures for hospital-employed hospitalist subsidies are even higher. The danger is that today’s credit crisis for hospitals will become tomorrow’s subsidy crisis for hospitalists.

Herein lays the opportunity for hospitalist groups of all types to seize this moment and reevaluate their business models with the goal of reducing their dependency on hospital subsidy dollars to sustain their practices. There are some situations where obtaining hospital stipends are totally appropriate, such as providing on-site night coverage or caring for a disproportionate share of indigent patients, but these situations are more the exception than the rule. Focus on finding opportunities and staffing models for your practice that will generate enough profit so that your practice is self-sustaining. Better to view your hospital subsidy as a luxury that your practice could live without if you had to, rather than as a necessity that you need in order to survive. It can be done.

 

First of a 3-part series on how the economic crisis affects hospitalists 

The world economy and US credit markets have clearly entered into a period of serious disruption. You may be asking yourself a series of questions: “How does this affect hospital medicine? More importantly, what are the implications for my hospital, my practice group, my career?” 

For the vast majority of companies and consumers, the ability to maintain financial strength and stability has become increasingly difficult. This is no less true for the hundreds of hospitalist practice groups that depend on bank lines of credit to maintain the cash flow needed to operate their business.  

Many practice groups will increasingly experience difficulty obtaining credit. As a result, many groups will find it a challenge to sustain their operations and even more of a challenge to grow their business. In purely financial terms this means that many practices cannot truly afford to pay the costs of recruiting, training and on boarding new doctors, because that takes credit. Then the practice has to wait for new doctors to generate enough cash to pay for their salary and overhead. That takes more credit. As the saying goes, it takes money to make money.  

It used to be a general rule that smaller companies had more difficulty obtaining credit than larger ones. But as we have seen, even giant companies can fall victim to the financial crisis. If you are a hospitalist employee – whether employed by a private practice or employed by a hospital - how do you know whether your employer can actually afford to keep you on staff?  The answer is, you don’t — unless your group is part of a publicly-held company such as IPC. Few practice groups volunteer to make their financial statements known to their staff. In the midst of a financial crisis, however, the culture of secrecy that shrouds the books of so many practice groups may finally have to give way. More transparency is required to provide hospitalists the comfort they need to feel secure in their jobs.

 

In early 2007 a group on private practice hospitalist groups formed a think tank that we call the Phoenix Group. This group has been meeting each spring and fall to discuss issues that we feel require attention and focus, both for our own interests as well as those of hospital medicine as a whole. In March 2008 the topic was patient satisfaction and HCAHPS. The discussion was extremely valuable to group members, and all of us benefited from the education we received on the topic from Joe Carmichael, president of NRC/Picker.  

The Phoenix Group has just released its white paper summarizing our collective views on the inadequacy of the current system used by many hospitals.  You are invited to read this and other Phoenix Group white papers at www.phoenixgroupwhitepaper.com . The authors, all CEOs and thought leaders in hospital medicine, conclude the survey tools currently utilized by hospitals are often misapplied to measure patient satisfaction at the individual physician level. This may result in judgments’ on a physician’s capability that are statistically unsupportable.  This is not only unfair and misleading but may also have a deleterious effect on physician morale, which in turn creates the very opposite of what the hospital is hoping to achieve by using the survey in the first place.

 

September through November is the season when large numbers of residents make their decisions about where to begin their hospitalist career.  The new recruits are being barraged with job offers like never before, yet choose they must.  Some will enter into the process with a “buyers market” mentality and approach their first job with a wait-and-see-what-they-do-for-me attitude toward their practice group, rather than engaging and committing themselves to the practice group and the facility they serve. Others will give their first job their all, with the wisdom maturity to understand that the first job should be approached with humility and respect for their more senior partners. Those who choose the latter will find that their practice partners will be more than happy to respond with a mentoring attitude when given the opportunity to do so. 

If I could offer one piece of advice to the new hospitalists it is this: be a team player  in your practice group from Day 1.  With a team oriented approach all good things can follow. Without that, it won’t really matter where you work because without being a team player your career can have only limited consequence.  Think team.

 

We all wonder if true leaders are born or bred. This eternal question of nature versus nurture applies to hospitalists just as well as it does to any group of medical providers. But given the growth rate of our specialty and the challenges that lay ahead, the question of where our future leaders will come from is more pressing than ever.

That’s why IPC will be participating in a big way in the Society of Hospital Medicine’s upcoming Hospitalist Leadership Academy Sept 22-25 in Los Angeles. IPC is sponsoring 30 hospitalists to fly in to attend this program. All of our participants are Practice Group Leaders for their respective practices from around the country. 

For the hospitalists participating in the program it is a significant investment of their time to take four days out of their busy schedule. It also creates a burden on their practice partners who have to cover in their absence. Not to mention the considerable investment on the part of IPC to bring all these doctors to the program. But to my way of thinking there is simply no choice. Hospital medicine needs leaders who are fully trained and committed to making their practices the very best they can be. Are the leadership skills of our practice group leaders the result of their training, or are they born leaders? I don’t know, but I’m not taking any chances. I want both.

 

Here’s a story you don’t see every day – at least not now. A report from a local newspaper in Cape Cod Mass. headlines “Cape hospital doctors brace for layoffs”.  Here are two hospitals, Cape Cod Hospital and Falmouth Hospital, looking to subtract rather than add hospitalists. 

I don’t pretend to know any more about the details of the reportedly pending layoffs of hospitalists than what is reported here. However, I did check the websites of these acute care facilities to learn that they have approximately 330 beds combined. 

The article quotes a Cape Cod Hospital spokesperson who states that “There are 33 hospitalists employed at Cape Cod and Falmouth Hospitals”. So perhaps it will come as no surprise that there may be a few less hospitalists at their next company clam bake. 

Hospitalists rightly spend a lot of time fretting about physician burnout and working at a pace that is not sustainable. We spend less time looking at the near side of the productivity bell curve. But there seem to be some facilities that indeed are looking – and carefully. The laws of economics may not always work as quickly or reliably as the laws of physics, but eventually they do kick in.

 

If your practice partners haven’t discussed among yourselves what kind of a culture you have, or want to have, you might think about initiating some dialog about it. There are lots of different cultures to choose from, and in various combinations. For example, you might have a culture that is absolutely committed to quality care. Or a culture where working hard is the norm. Perhaps a culture of work-lifestyle balance best describes your practice. Your culture might be dedicated to a specialty such as pediatrics, or long-term care. Perhaps your practice embraces the culture of your hospital-employers, or perhaps you prefer the more entrepreneurial culture of a private practice. There are so many cultures to choose from. How do you know which is right for your practice?  

The successful practice culture is the one that is embraced and accepted by your practice partners, your hospital and your patients. It is the one that you and your practice partners are committed to, and only you and your partners have the answer as to which culture is right for you. The important point is to have one, to articulate what that culture is, and then to live it – to “walk the walk”. 

Not to decide on cultural norms for your practice is, in effect, a tacit admission that your practice isn’t anything special. Is that true for your group? As the saying goes, not to decide is to decide.