MARSHALL HOSPITAL: Struggles For Managed Care Foothold
Marshall Hospital's struggles to enter the managed care arena illustrate "how tough it can be for a small, independent hospital to venture into the highly competitive and complicated world of managed care," the Sacramento Business Journal reports. The Placerville facility has spent $4.8 million since launching the Marshall-El Dorado Physician-Hospital Organization, or PHO, in 1995. Since that time, the PHO has weathered a "management shake-up, ongoing red ink and a critical audit" that prompted its one large client, PacifiCare, to step up oversight of the operation. Marshall Hospital did post a profit of $665,452 last year, but it has faced "huge swings in and out of the red" in 1998. And to date, the PHO has "nailed down" only one major client: PacifiCare, accounting for 7,800 members, including the hospital's employees. According to managed care experts, it takes about 20,000 enrollees for a health plan to "cover overhead and break even." Marshall has "alternately courted and snubbed Foundation Health Corp.," disagreeing periodically over reimbursement rates, the Sacramento Business Journal reports. In December, Marshall agreed to "accept capitation ... but the change has yet to be made." One physician in the PHO said, "The doctors are living in a dream world if they think they can go back to indemnity-based fee-for-service if they pull the right strings" (Robertson, 5/11 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.