New Jersey physicians are under stress from the rapidly changing health care environment, and the majority are considering changes to their practice structure, such as merging with a hospital or another practice, according to a new survey.The third annual New Jersey Health Care Monitor survey by the law firm Brach Eichler, conducted last November and December, found that nearly 90 percent of respondents believe the health care environment has negatively impacted their role as a physician. Of those, more than 86 percent report increased administrative burdens, while more than 60 percent are spending less time with patients and more money on technology. The majority of physicians reported changes in their reimbursement levels, with some saying their compensation has increased, while others are earning less as health care reform transforms their profession.
The statewide survey received responses from 100 physicians, including solo practitioners, members of a group practice or physicians employed by a health care facility.
John D. Fanburg, chair of the health law practice at Brach Eichler, advises physicians, hospitals and other health care providers during merger transactions, and said he’s not surprised by the survey results.
“What we’ve seen in the transactional area is a lot of activity, a lot of frustration and fear,” Fanburg said. “We have doctors doing one of four things: selling their practice to a hospital; joining a large multispecialty group, joining or forming a single specialty group” or making no changes and instead “just trying to ride it out until the next phase of health care reform or economics kicks in.”
Fanburg said it’s significant that 53 percent of respondents are considering changing their practice structure; that is up from 45.5 percent in the 2013 survey. He said more physicians are considering a transaction because they know other physicians who have taken this step.
“I had one physician group that was interested in joining a hospital and they said, ‘Such and such group did it last year and they seem to be okay with it.’ So as more of the physicians’ colleagues do these transactions, they are more comfortable doing it, too — as opposed to five years ago, when no one was doing this.”
But Fanburg said he’s had a few cases where merging a doctor practice into a hospital didn’t work out, and he’s helped terminate the relationship. In some cases, physicians don’t see the reduced administrative burdens or stable compensation they had hoped for.
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“At the same time, in some cases maybe the hospital jumped too soon,” Fanburg said. “There is this huge turf war going on in terms of capturing as many physicians as possible while they’re still in play. At some point every (physician) worth getting will be gone and then the hospitals and the big groups have to decide, ‘Did we bet on the right people?’”
Fanburg said he is hearing success stories from physicians, post-merger, who are enjoying reduced administrative burdens after joining a larger organization. Others, however, miss the autonomy they left behind.
Adopting electronic medical records has been a significant challenge for some practices, Fanburg said. And while the federal government has provided financial incentives to smooth the transition, “I still have lots of clients who are just never going to adopt electronic medical records,” he said. In some cases, the physician is nearing retirement and when weighing the cost “in light of how much longer they have to practice, they don’t feel it’s going to be worth it to them.” Larger practices, however, accept health IT as a normal, mandatory expense.
Joel Cantor, director of the Rutgers Center for State Health Policy, said the survey’s 100 responses is a fairly small number from which to extrapolate to how all doctors feel, and said he’s not familiar with the survey’s methodology. But, Cantor said, “In general, physician studies in recent years have come to similar conclusions: that practicing medicine has gotten more difficult, with payment rates not keeping up with practice expenses, more red tape, more pressure to increase volume.”
Linda Schwimmer, vice president of the New Jersey Health Care Quality Institute, said, “The results are interesting and are evidence of just how hard it is to transform health care.”
Schwimmer added: “We are at a turbulent time in health care and physicians are in the bull’s-eye of the change. But change brings opportunity and prospects for real improvement.”
She noted that practices need to invest in electronic systems, “but this has been true for many fields for the last 20 years. Medicine, frankly, is playing catch-up.”
The survey found that nearly 40 percent of respondents have an unfavorable or very unfavorable outlook for their medical practice in 2015, while only about 23 percent reported a favorable outlook. No respondent reported a very favorable view for 2015. These findings are less optimistic than last year’s survey, when 38 percent had an unfavorable view and more than 26 percent reported a favorable outlook.
Among the survey’s other findings:
Of the 44 percent who reported changing their practice structure in 2014, 42 percent hired other practitioners, 39 percent integrated their practice with another health care organization and nearly 13 percent retired.
Only about 3 percent said their income increased substantially in 2014 over 2013, while nearly 38 percent said it decreased substantially and nearly 60 percent said it remained the same.
The survey found that nearly 29 percent of respondents now belong to Accountable Care Organizations, which provide financial incentives to improve quality and lower costs. Only 5 percent report any benefits from membership in an ACO.
The survey also found that the “patient-centered medical home” model, in which health care providers coordinate patient care and focus on improved population health, at not the norm in New Jersey, with just over 10 percent reporting that they had been approached to enter into a contract with a medical home.
Fanburg said the PCMH model is still in its early stages, and is not yet well understood by physicians. But he said it would help doctors to move toward the PCMH model, in which “You’re really trying to be proactive and not only help the patient get healthy, but stay healthy, and coordinating care with your colleagues.” He noted that traditionally, patients have received care from multiple doctors who may not have been aware of what the other doctors were doing. “That type of health care system is not sustainable nor is it good for the patient.”
Schwimmer of the New Jersey Health Care Quality Institute said, “The shift to patient-centered care and the accountable care models holds real promise to improve physician-patient communications, to engage in ‘shared decision-making’ where physicians and their staff have the time to discuss and understand their patients’ goals for care and health and then suggest next steps in that context including when that test, drug or procedure may not be medically necessary or good for the patient, given their goals.”
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