Cartoon – Concerned About
Monthly Archives: July 2023
Cartoon – Stepping up to the Plate
Cartoon – You’ve Tested Positive
Cartoon – In Denial
Cartoon – Someone Cares
Cartoon – Suffering in Silence
Cartoon – Resuscitation Available
When private equity and doctors break up
https://mailchi.mp/c02a553c7cf6/the-weekly-gist-july-28-2023?e=d1e747d2d8
We recently spoke with a health system COO who wanted help playing out scenarios regarding the relationship between specialist physicians and their private equity (PE) partners. The system is located in one of the markets referenced in a recent study that has some of the highest levels of private equity ownership in the country. One physician group, whose doctors provide almost all the system’s coverage for a key specialty, has worked with PE partners for five years, and the relationship is not going well. “We’re hearing that many of the younger doctors want to leave. And many of the others are close to retirement,” he shared.
“We’re really concerned about what could happen if the group implodes.” The key issue: the doctors signed very restrictive noncompete agreements when they sold their practice, which could prohibit them from working in the market.
The health system would consider bringing some of the doctors into their employed medical group, but executives are worried this might be impossible for the duration of the noncompete agreements. “If these doctors can’t stay locally, we might have to rebuild that specialty from scratch. And I can’t imagine how disruptive that would be,” he worried.
When the FTC announced a proposed rule earlier this year that would ban employers from imposing noncompete agreements, many health systems reacted with alarm, fearing the that the freedom to move would lead to frequent bidding wars, ultimately driving up the cost of physician talent in the market.
But the situation shows how perspectives would change depending on who holds the noncompete.
Mid-sized markets like this one, where coverage for several specialties may come from single groups, are particularly vulnerable. Regardless, this situation highlights the need to diversify physician relationships to guard against getting caught in a “coverage crisis”.
Hospitals still struggling to retain talent
https://mailchi.mp/c02a553c7cf6/the-weekly-gist-july-28-2023?e=d1e747d2d8
Of all the pandemic’s impacts still felt today, disruptions to the healthcare workforce and rising labor costs may be most impactful to current health system operations.
Over the next three editions of the Weekly Gist, we’ll be exploring the lingering effects of this workforce crisis, with a focus on nurse staffing and recruitment.
In this week’s graphic, we use data from the 2023 NSI National Health Care Retention Report to show how hospital turnover and vacancy rates have changed over the past several years.
While wage increases helped reduce hospital registered nurse (RN) turnover rates from 27 percent in 2021 to 23 percent in 2022, nurses—along with hospital employees in general—are still changing jobs at higher rates than before the pandemic.
Over half of all hospitals still face nurse vacancy rates above 15 percent, a slight improvement from 2022 but still far more than before the pandemic.
While the worst of nursing turnover appears to have passed, the “rebasing” of wages (for nursing, 27 percent higher compared to 2019) will provide ongoing pressure to strained hospital margins.
Physicians lack trust in hospital leadership
https://mailchi.mp/c02a553c7cf6/the-weekly-gist-july-28-2023?e=d1e747d2d8
A recent physician survey conducted by strategic healthcare communications firm Jarrard Inc. uncovered a startling finding: only 36 percent of physicians employed by or affiliated with not-for-profit health systems trust that their system’s leaders are honest and transparent. In contrast, a slight majority of physicians working with investor-owned health systems and practices answered that question in the opposite.
Overall, only around half of physicians trust their organization’s leaders when it comes to financial, operational, and patient care decision-making. Unsurprisingly, doctors put the most trust in peer physicians, by a wide margin.
The Gist: While the numbers, especially for nonprofit systems, are stark, this survey reflects an on-the-ground reality felt at health systems in recent years. Physician fatigue has spiked in the wake of the pandemic.
And health system-physician relationships are also being disrupted by cost pressures, payer and investor acquisitions, and the shift of care to ambulatory settings. We’ve heard from physicians that, compared to hospital owners, investor-backed systems provide greater transparency and clearer financial goals centered around the success of the business.
That physicians trust their peers so highly suggests a path forward: provide physician leaders with greater transparency into system performance and agency over strategy, with clear goals and metrics.
HENRY KOTULA 