Crunch Time

Before his recent promotion, hospitalist Garth King, MD, medical director of the Schumacher Group at Southwest Medical Center in Lafayette, La., had hoped to add a fourth full-time doctor to his roster. The hiring made sense at the time. As recently as last summer, the group’s three full-time doctors were averaging 35 to 40 patient encounters a day, enough to warrant the additional hospitalist position. But the group’s census dropped 25% in the fourth quarter of 2008, and these days, Dr. King simply can’t justify the math to bring on another six-figure salary.

“Over the past two, three months, patient slowdown has pushed off the ability” to add staff, Dr. King explains. “We’ll wait until things ramp up again, once we get the numbers to where they were before.”

Dr. King could be in for a long wait. The fiscal meltdown that began in 2007 and last year mushroomed into a full-blown recession has taken hold in the world of hospital medicine. More and more, hospitals are reporting decreased revenues and increased levels of charity care. The result: Planned group expansions have been put on hold, open positions are going unfilled, and some hospitalists have been laid off.

Constituencies from health-system executives to rank-and-file hospitalists to economists remain cautious of acting too boldly before President Obama and the new Congress unveil much-anticipated changes to Medicare billing and reimbursement schedules. Aggressive reforms, such as extending health coverage to more than 45 million uninsured Americans, could swamp hospitals with new patients and lead to cuts in reimbursement rates. A more temperate approach by the new administration could leave a relative status quo.

Brace your HMG for tough economic times

What can hospital medicine groups and their leaders do to insulate their practice from the economic crisis and the possibility of drastic changes to government reimbursements? Interviews with nearly a dozen industry leaders suggest a few tactics:

  • Prove value. One-on-one relationships with chief executives are important, but data is undeniable. Track as many metrics as possible—length of stay, throughput, patient encounters, coding and billing efficiency—and present the data on a regular basis.
  • Be objective. Negotiation is one thing, brinksmanship another. Understand the group’s role in an overall healthcare perspective and tailor data to accentuate the positives. Remember data points aren’t just for the group’s singular point of contact. They have to impress the boss’ boss’ boss.
  • Branch out into less traditional roles. Take on tasks some specialists might be reluctant to do, including intubations, radiology, and placing central lines. A specialist remembers the group that freed them up from four central lines, which afforded them the time to perform a more lucrative procedure.
  • Offer the group’s expertise to the hospital community. Have an employee skilled at coding and billing? Think about scheduling a hospitalwide seminar to work with others involved in billing.
  • Develop a strong relationship with the chief financial officer. Data is king, but cash rules. Profit-and-loss statements often push policy, and the person in charge of the balance sheet pulls a lot of weight.

Either way, hospital medicine has never endured a recession so deep that some healthcare economists liken it to the Great Depression, so the practical effect on the industry is difficult to forecast with accuracy. Hospitalists and their observers agree on one thing, though: This is the year hospital medicine will have to prove its worth more empirically than ever. Positive public relations and studies proclaiming reduced lengths of stay and sped-up emergency department throughput have given the industry a “rarified position as a specialty,” one researcher says. But in constrictive economic times, those figures likely will be revisited, says Mark Pauly, professor of healthcare management at The Wharton School at the University of Pennsylvania. “When revenues are falling, you go back and look at that evidence again,” Pauly says. “Is it really bulletproof?”

About Richard Quinn

Richard Quinn is an award-winning journalist with 15 years’ experience. He has worked at the Asbury Park Press in New Jersey and The Virginian-Pilot in Norfolk, Va., and currently is managing editor for a leading commercial real estate publication. His freelance work has appeared in The Jewish State, The Hospitalist, The Rheumatologist, ACEP Now, and ENT Today. He lives in New Jersey with his wife and three cats.

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