COLUMBIA/HCA: Prunes Physician Practice Ownership
In recent months, Columbia/HCA Healthcare has slashed ranks of owned physician practices as part of an attempt to refocus on its core business -- hospital operations. Only about 600 physicians remain on Columbia's payroll, a 60% drop from the 1,500-doctors figure of a few years ago. American Medical News reports that ownership of physician practices "hasn't been a business strategy that has helped us," Columbia/HCA spokesman Jeff Prescott said. The move is of little surprise to industry analysts, given that in recent years, hospitals nationwide have failed to realize the expected benefits of physician practice ownership, such as increased patient admissions, and have lost money. Prescott did not provide an estimate of Columbia's physician-related losses, but "[i]n most cases, [hospital losses] have come well above $30,000 per physician," said Barry Massey, managing director of The Pace Group, a health care consulting firm. Because of such "dismal" results, analysts expect hospitals to choose more carefully the physician practices they own, but not to abandon such ownership altogether, the path Columbia appears to be following. "It's not a grand sweep of getting doctors out the door," PricewaterhouseCoopers analyst Sandy Lutz said. Those physicians affected by Columbia's divestiture have had to affiliate with other practice management groups or form independent practices on their own, as Columbia is not "brokering any deals." The divestiture has left some physicians with "a bad taste in their mouth[s], as many feel left "in a lurch," one physician told American Medical News (Jacob, 9/20 issue).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.