It’s no surprise that the shortage of primary care physicians, so vital to American health, is getting worse.
They practice in one of the lowest paying and least attractive fields in medicine. Most people are overworked and in a day he sees as many as 30 people. Diagnose a sore throat to a streptococcal infection or manage a patient’s chronic diabetes.
So why would multi-billion dollar companies, especially giant health insurers, gobble up primary care practices? I bought Oak Street Health for a dollar. Oak Street Health is a fast-growing chain of primary care centers that employs doctors in 21 states. And Amazon’s acquisition of One Medical, another large group of doctors, for his nearly $4 billion is one such move.
The attraction is simple. Despite their low status, primary care physicians oversee vast numbers of patients who generate business and profits for hospital systems, health insurers, or pharmacies looking to expand.
In addition, there is another attraction. The growing privatization of Medicare, the federal health insurance program for older people in the United States, means that more than half of the 60 million beneficiaries are covered by a private insurer under the Medicare Advantage Program means The federal government currently pays these insurers $400 billion annually.
Erin C. Hughes-Brown, Director of the Georgia State University Center for Law, Health and Society and author of an article on business investment in the New England Journal of Medicine, said: primary care. “It’s a one-stop shop for all your medical bills,” she said.
Many doctors say they have become mere employees. “I’ve seen this loss of autonomy,” said Dr. Dan Moore, who recently decided to start his own clinic in Henrico, Virginia, saying he has more say in patient care. said. “Spending an average of seven minutes with a patient doesn’t make you a doctor,” he said.
Absorption of physician duties is part of a massive and accelerating consolidation of healthcare, leaving patients in the hands of a few large corporations and hospital groups. Many were already patient insurers and controlled the distribution of medicines through the ownership of drugstore chains and pharmacy benefit managers. But a recent analysis by the Physicians Advocacy Institute found that nearly seven of her ten of all doctors are now employed by hospitals or businesses.
These companies say these new arrangements will result in better, more coordinated care for patients, but some experts say the prices and systems in which integration is driven by the pursuit of profit rather than patient welfare. It warns that it will lead to soaring prices.
Insurers say purchasing a medical practice is a step toward so-called value-based care, in which insurers and doctors pay a flat fee to treat individual patients. Fixed payments act as an economic incentive to keep patients healthy, increase access to early treatment, and reduce hospitalizations and expensive specialist visits.
These companies say they favor fixed fees over existing systems that pay doctors and hospitals for each test and treatment, encouraging doctors to order too many procedures.
Under Medicare Advantage, when doctors take the financial risk of a patient’s care, they often share the benefits with insurance companies, earning more if they save on treatment costs. Instead of receiving hundreds of dollars for clinic visits, a primary care physician can pay $14,000 a year to manage one patient.
But experts warn that these large-scale acquisitions threaten the personal nature of the doctor-patient relationship. Especially when the parent company has the authority to dictate limits on services from initial office visits to lengthy hospital stays. Once registered, these new customers can be directed to a range of related businesses, such as CVS drugstores and Amazon’s online pharmacy.
UnitedHealth Group is a vast example of integrated services. The company owns a major insurance company with approximately 50 million customers in the United States and oversees its growing subsidiary, Optum. Optum acquires a network of doctors and medical sites. Optum can send patients from her 1 of about 70,000 doctors to his 1 in emergency care centers or surgery centers.
Democratic Senator Elizabeth Warren of Massachusetts has called on the Federal Trade Commission to take a closer look at some of these large deals that regulators have not blocked for antitrust reasons. “I fear that the acquisition of thousands of independent providers by some large healthcare giant conglomerates could reduce competition on a local or national basis, hurt patients and increase healthcare costs,” she said. ing.
This medical consolidation may also violate state laws that prohibit what is called corporate medical care. Such laws prevent companies that employ doctors from interfering in patient care.
Experts also warn of potential harm to patients when business owners try to control costs through complex systems that require pre-approval to receive treatment.
For example, Kaiser Permanente, a giant nonprofit health insurance company that also owns a group of doctors, settled a nearly $2.9 million malpractice case with the family of former tennis player Ken Flach last year. Doctors did not visit him in person or send him to the emergency room, despite his wife’s urgent pleas. “I have the deepest sympathy for the Flach family,” said Kaiser, who said medical decisions are made by health care providers in consultation with patients.
Physicians are also frustrated by oversights that do not benefit their patients. “They’re trying to run it like a business, but it’s not a business,” said Dr. Beth Kozak, a physician in Grand Rapids, Michigan.
Her physician group is working with investor-owned company Agilon Health on the Medicare Advantage Plan. Dr. Kozak must work longer hours not to provide better care, but to provide patients with additional diagnoses, she said. “It’s not because I’m providing better patient care,” she said. “It’s all tied to billing.”
Corporate medical spending continues to grow. The Walgreens Boots Alliance, one of his largest pharmacy operations in the U.S., spent his $5 billion on a majority stake in primary care group VillageMD and partnered with Cigna to build another medical group for about $9 billion. was acquired by Also, short of a full acquisition, UnitedHealth is partnering with his Walmart to provide care for elderly patients.
In touting the benefits of buying the Oak Street clinic to investors, CVS Health Chief Executive Officer Karen S. Lynch said primary care physicians would cut medical costs. “Primary care fosters patient engagement and positive clinical outcomes,” she said.
Many of these companies are building chains of clinics. On a recent tour of Bushwick’s Oak Street Clinic, one of 16 centers to open in New York City since October 2020, patients are typically seen from 8 a.m. to 5 p.m. could ask questions after hours.
Ann Greiner, chief executive of the nonprofit Primary Care Collaborative, defended the recent forays into this healthcare sector by private companies that are pouring much-needed funding into the practice. It has the potential to improve access to care for people in underserved areas, he said. .
“People making these arrangements are paid higher,” she said. “They’re providing more comprehensive care in many of these arrangements. They’re providing more technology and team-based care. That’s all the investment.”
But these deals also risk shifting the balance from quality treatment to profits, she said.
In recent years, some have invoked laws banning corporate healthcare to challenge these large private businesses. In California, Envision Healthcare, a private equity-backed company that employs emergency room doctors, has been approved by state regulations from a division of the American Academy of Emergency Medicine, a group of professionals that supports independent practice. accused of violating.
According to the lawsuit, “Envision deeply instills direct and indirect control and/or influence over the medical practice of physicians.” The complaint alleges that Envision manages physician claims and establishes medical protocols.
Envision would not comment on the lawsuit, but said it “follows an operating structure that is common across the healthcare sector and widely used by non-profit, private and public bodies as well as hospitals and insurance companies.” Stated.
Many insurers have reported substantial losses, but large insurers find groups of doctors particularly attractive. The acquisition of Oak Street, which he lost over $1 billion over the last three years, could help improve the quality or “star” rating of CVS’s Medicare Advantage plans and help him pay more for one of those plans. There is a nature.
Even a small number of patients can lead to large profits. One Medical, an Amazon-owned company, is best known for its sophisticated clinics. The company has scooped up a practice dedicated to Medicare Advantage. Only about 5% of One Medical’s 836,000 members are enrolled in its federal program, according to its 2022 financial statements, but about half of its revenue comes from a small percentage of its patients. is.
Regulators have already flagged questionable methods employed in some practices. In November 2021, Oak Street revealed that the Justice Department is investigating marketing tactics such as free trips to clinics and insurance agent payments for referrals. According to a shareholder lawsuit against Oak Street, a doctor at one center explained that it recruits patients with “gift cards, souvenirs and goodie bags.”
The lawsuit detailed concerns that doctors were overstating the extent of their patients’ illnesses to inflate payments from the federal government.
Oakstreet said he was not accused of wrongdoing by the Justice Department and said the lawsuit was “baseless.”
These private Medicare Advantage plans have been heavily criticized for making huge profits by inflating costs and exaggerating patient illnesses to overcharge the government.
Under the new rules, the Biden administration will eliminate some of the most problematic and overused diagnoses, allowing doctors and insurance companies to cut their income.
But other avenues to profit also explain why companies crave these deals. How much profit these doctor’s practices and pharmacy chains can make, unlike the insurer money-making cap where Medicare Advantage insurers must spend at least 85 cents on every dollar spent on patient care. there is no limit.
It may be too early to tell whether integrated care improves patient health. Sachin H. Jain, Ph.D., CEO of SCAN Group, a Long Beach, Calif.-based nonprofit that provides Medicare Advantage, said: schedule.
Also, this investment may not stem the rapid disappearance of doctors, who are sought after by so many people for their usual care, including recent reports showing a decline in the number of medical school graduates entering the medical field. not.
“We are dealing with an incredible level of burnout in our industry,” said Max Cohen, M.D., a private practice near Portland, Oregon. “Through the Roof”