As hospitals acquire more private practices, insurance costs rise

From the AMA Morning Rounds:

On the front page of its Business Section, the Wall Street Journal (8/27, B1, Mathews, Subscription Publication) reports that it is becoming increasingly more common for hospitals to acquire private physician practices, and this may be contributing to higher costs for routine healthcare. In many cases, a service can increase in price after an acquisition, despite no change in procedure or location. This is due to the structure of insurance reimbursements, which are often more generous to hospitals than independent practices. Though the hospital industry says the growing rate of private-practice acquisitions will increase efficiency and improve quality, health insurance companies say that for now, it is just costs that are rising. 

As the forces that promote more consolidation of health care services continue, we can expect costs to also rise.  These policies will make the business of medicine more profitable but increase the personal cost to consumers.   In earlier blog postings I have commented on how the system (via Medicare reimbursement/CMS policies) perversely rewards hospitals while taking away from private practice physicians for the very same services.

-Raymond Kordonowy, MD

About thedoctorsreport

Dr. Kordonowy is board certified by the American Board of Internal Medicine and has been in private practice since 1993. His group practice is in Fort Myers, Florida. His website is: He earned his degree from the University of Kansas School of Medicine in Kansas City, Kansas and completed his residency as Chief Resident at Orlando Regional Hospital System. As Chief Resident, Dr. Kordonowy was recognized as the Outstanding Resident by the American College of Physicians. He is a member of the American Medical Association, American College of Physicians, and the American Society of Internal Medicine. In December 2005, Dr. Kordonowy became Board Certified in the new field of Clinical Lipidology by the American Board of Clinical Lipidology. Lipidology is the specialty of diagnosis and management of cholesterol and triglyceride metabolism disorders. Cardiovascular disease risk assessment is also part of this specialty. He now serves as president of the Independent Physicians Association of Lee County. He is active in the Lee County Medical Society, the Florida Medical Society , the Florida Lipid Foundation, National Lipid Association and the American Medical Association.
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1 Response to As hospitals acquire more private practices, insurance costs rise

  1. Pingback: Future Predictions for Healthcare in America | The Doctor's Report

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