What Do Doctors Want from Your Organization? (Part 3 of 5)

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We continue our look at the reasons why doctors want to be hired by healthcare organizations and at the various issues and factors behind hiring physicians.

As Karen Minich-Pourshadi asks in her March 2013 article for HealthLeaders magazine, Exactly why do doctors favor employment over a joint-venture partnership?

One reason is obvious: saving money. Britt Berrett, Ph.D., president of Texas Health Presbyterian Hospital Dallas, told Minich-Pourshadi, hospital employment for physicians often gives them financial benefits that self-employment doesn’t, “such as better pricing on an IT platform and more sophisticated revenue cycle and collections.”

Julie Manas, president and CEO of Sacred Heart Hospital in Eau Claire, Wis., and division president and CEO of the Western Wisconsin division of Hospital Sisters Health System, believes it goes deeper than just saving money, however, for both the physician and the organization. She said, “Sometimes an employment agreement with a singular physician can be less complicated and move forward more easily than trying to create a joint venture” with many different partners involved.

Employing a physician needs to be done judiciously, she stresses. Manas’ organization only employs 20 physicians; the other 300 practice with the hospital, but are in joint ventures or on clinic councils with other groups. Sacred Heart hires “based on market factors,” realizing “employing physicians can seem like a great option…but it’s not always the best one.”

James Jarrett, president of the New Jersey ProCure Proton Therapy Center of Bloomington, Ind.’s ProCure Treatment Centers, favors joint ventures over employment, saying, “We don’t employ any physicians in this entity, though a lot of doctors do ask me about it, as do a number of our hospital partners. Employing physicians is very much top-of-mind. But we partner or use joint ventures with our physicians. Our doctors are part owners, and we feel it will drive better longer-term patient care behavior.”

What makes ProCure’s joint-venture arrangements attractive to physicians, he adds, is their lack of involvement in the business side of healthcare. Patient care is the chief expectation of the physician. Jarrett said this gives the physician “more independence while encouraging them to help the organization grow.”

This is in stark contrast to the employed physician, who “may find they have to participate in broader health-system initiatives, and not every person will agree with every initiative. Doctors may be expected to keep referrals in-network, or the physician may have certain objective targets to meet. It can give the physician an overall feeling that they are being driven by profit, whether that’s true or not,” he added.

Does your organization prefer hiring physicians or establishing joint-venture partnerships with several of them? Which factors in your market tell you when it’s right to hire physicians? Which approach to hospital-physician relationships do you prefer, joint venture or employment? Why?

-by Pete Fernbaugh

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