As healthcare reform takes shape across the country, medical groups will remain at the center of the frenzy to form integrated healthcare delivery networks.
More than ever, hospitals and physicians in sole practices will court each other in hopes of forming closer, more formal provider relationships.
As a result, expect mergers and affiliations of medical groups to continue as hospitals and health insurers scramble for a piece of the ownership action. Watch for hospitals and insurers to initiate moves of their own and manage groups of salaried physicians.
The drive to voluntarily integrate healthcare services will push the movement forward in such markets as Louisiana, Oregon and Texas, which have been slow or unwilling to embrace the idea of medical group formation.
Physicians and hospitals just waking up to the reform movement must realize that the future of fee-for-service medicine is dubious at best.
The successful group practice will have a strong base of primary-care physicians. That important component within the medical group will be at the core of what hospitals and health insurers want as business coalitions and other large purchasers of healthcare put the squeeze on providers to offer prepaid medicine.
Physician-driven systems-such as Oakland, Calif.-based Kaiser Permanente and Rochester, Minn.-based Mayo Clinic-that have experience and clout in assuming risk are well positioned to compete under whatever healthcare reform brings. Watch these systems grow into even larger, statewide megasystems.
Existing medical groups seeking to compete with such powerhouses as Artesia, Calif.-based Mullikin Medical Centers will begin testing the waters of capitation.
Also, the increase in capitation business will affect the status of quality outcomes data.
Buyers of healthcare will demand the information, and many provider groups will invest in outcomes analysis to demonstrate their value and service potential. Both sides know the data will influence which providers will win and which won't.
As the consolidation fury grows among providers, expect some regulatory scrutiny.
"Successful integrated healthcare systems will have their foundation in the group practice of medicine. Physicians collectively in this type of organization will become responsible and accountable for not only the care of their patients but also for the care of the community and healthcare system as well. This can only happen through a group setting."
-Frederick J. Wenzel,
interim executive director and CEO Medical Group Management Association,
adviser, Marshfield (Wis.) Clinic
"Integration activity will grow to include healthcare payers such as insurance companies and health maintenance organizations merging with physicians and healthcare systems. Physician management companies such as Pacific Physician Services, Phycor and Caremark will face new competition as other new players explode on the scene seeking a piece of the action."
-Jerry F. Pogue,
Integrated Healthcare Symposium,
Lake Arrowhead, Calif.
"Because nobody knows what the (healthcare delivery) model will be under reform, physicians first will have to be flexible in adapting to the new marketplace. In 1994, primary-care physicians will be wooed to no end by everyone from hospitals to insurance companies. Any organization that wants to be competitive in this business wants as many primary-care physicians as they can attract."
executive vice president,
HealthCare Partners Medical Group,
Unified Medical Group Association,
Seal Beach, Calif.