First Word: The Practice Integration Issue

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 - C.P. Kaiser

It was welcome news in May when CMS announced it had corrected some miscalculations to the 2010 Physician Fee Schedule, which resulted in a 16 percent payment increase for SPECT imaging. It’s a start, but the advocacy work to reverse other cuts—and even further reduce the cuts for SPECT—goes on.

One of the consequences of the drastic payment cuts to outpatient cardiology services has been the increasing momentum for practices to align or merge with hospitals. In this issue of Cardiovascular Business, we explore the physician/hospital integration dynamic in multiple ways.

In our cover story ( see page 6), we invited participants from two different hospital systems to discuss their various integration models, along with a lawyer conversant on this topic. These are not the heady days of the 1990s when the wave of integrations was primarily motivated by the threat of managed care. “Hospitals were consolidating, purchasing practices to secure more power,” says Brian J. Silverstein, MD, senior vice president of The Camden Group. “In those days, valuation of practices was high and hospitals’ contracting sophistication was low.”

While the desire to integrate is being driven primarily as a means for physician practices to combat diminishing margins, players on both sides of the fence are savvier then they were 20 years ago.

On page 12, we offer a glimpse into what small practices are doing to remain viable solo entities. Between creating new service lines, increasing their marketing and improving their use of technology, these practices might have a shot. But no one is holding their breath.

Dr. Blair Erb, Jr., in the monthly ACC Corner ( see page 11), lays out the dire situation, gleaned from a survey of ACC members: 28 percent of those in private practice have plans to merge within the next two years, 12 percent are considering it in three or more years and 14 percent who thought they wouldn’t, now would consider it. A survey by MedAxiom of its members ( page 22) reveals the fears, rewards and challenges associated with integration.

SPECT imaging will remain a workhorse for many cardiology practices and the article on page 21 details how advanced technology and improved protocols can help deliver better patient care, while potentially increasing throughput. And finally, The Back Page column is an excellent article about one practice’s use of PET imaging to increase the value of its nuclear cardiology service.

These are tough times for private practices. We hope that this issue of Cardiovascular Business will help you better prepare for an integration model or stay afloat on your own.