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Hospitalists Stand Up at AMA and in D.C.


A week before the American Medical (AMA) Association House of Delegates met in Chicago this past June, the SHM leadership became aware of the AMA Board of Trustee’s Report 19 to be debated at the AMA meeting. The report, “Corporate Practice of Medicine,” and its recommendations included the following provision:

The Board of Trustees recommends that the following be adopted: That our AMA develop model legislation prohibiting lay corporations, including hospitals, from directly employing physicians, and make this model available to state and national medical societies.

Because more than 50% of hospitalists are currently either employed by hospitals, health systems, or corporations this policy—had it been enacted—would have adversely affected hospitalists.

Mobilize the Troops

Rewind to last June: As the clock ticked, SHM leadership sprang into action. SHM developed a letter (see “Letter from SHM to the AMA,” at right on p. 7) to the AMA president, chairman of the board of trustees, and the executive vice president, expressing strong opposition to this policy. SHM senior leaders also made direct, personal appeals to individuals on the AMA board.

In addition SHM sought the counsel and advice of the American College of Physicians (ACP), especially the ACP’s Washington, D.C., senior staff, including Bob Doherty, senior vice president of governmental affairs and public policy, and Jack Ginsburg, director of health policy analysis and research. SHM also consulted the leadership of the ACP delegation to the AMA. In this effort ACP allied with SHM to defeat this resolution.

SHM’s Tosha Wetterneck, an AMA delegate from Wisconsin and the Young Physicians Section, was prepared to give testimony against this report and recommendations at the AMA Reference Committee and, if necessary, on the floor of the AMA House of Delegates.

All this happened in a matter of days as delegates headed to Chicago for the AMA meeting.

The very turbulence and reinvention of the healthcare system in this country that’s driving the growth of hospital medicine may fuel a response from traditional professionals, such as those in the AMA, concerned about change and evolution.

The Decision

Through the efforts of SHM, ACP, and others, the AMA board wisely decided to withdraw the report and recommendations from the business of the House of Delegates and contacted SHM to thank us for our comments and participation.

Hospital medicine is a relatively new specialty, and SHM is a young organization compared with the AMA and the many specialty societies represented at AMA meetings. In addition, hospitalists tend to be generally younger physicians, who may feel that participation in national medical organizations such as ACP and AMA are not relevant to their professional lives.

In reality, though, the very turbulence and reinvention of the healthcare system in this country drives the growth of hospital medicine and may fuel a response from traditional professionals concerned about change and evolution. Because of the unique perspective of hospitalists and hospital medicine, SHM needs to be at the table. And we need to have thoughtful suggestions as we help to shape the future as well as send articulate responsible hospitalists to participate in these deliberations.

Public Policy Committee Leads the Way

The SHM Public Policy Committee (under the chairmanship of Eric Siegal and Laura Allendorf on SHM’s Washington D.C.-based staff) is taking the initial steps to be a player in healthcare advocacy. SHM has commissioned Health Policy Alternatives, a major Washington D.C. advisor on health policy, legislation, regulations, and policy making process, to develop a White Paper to better define the unique aspects of hospital medicine in a form that is understandable and meaningful to legislators and regulators, including the Centers for Medicare and Medicaid Services (CMS).

The Public Policy Committee will also formulate and recommend SHM policy on compensation reform and pay for performance. In consultation with the Hospital Quality and Patient Safety Committee, the Public Policy Committee will also develop policy on quality initiatives and safety standards.

To get hospitalists involved in the advocacy arena in a face-to-face, hands-on fashion, the Public Policy Committee plans to hold the first SHM Legislative Day on May 3, 2006, just prior to the SHM Annual Meeting in Washington, D.C. SHM will invite hospital medicine leaders to Washington to be educated on the key advocacy issues and how best to interact with their congressional representatives, senators, and their health staff. Appointments will be made for the hospitalist leaders to go to the Hill for meetings with their legislators on May 3. Check the SHM Web site ( and future issues of The Hospitalist for details about how you might participate in the SHM Legislative Day 2006.

Hospitalists Participate in Code Review

This year—2005—is the Five Year Review of all the billing codes by AMA’s Relative Value Update (or RUC) Committee with recommendations to CMS and the government. Most medical societies participate by having key members examine the work involved in performing specific functions described by the current procedural terminology (CPT) codes. The idea is to update the work and, therefore, the compensation for the work of healthcare.

SHM partnered with ACP in this effort, and more than 25 SHM members concentrated on a review of hospital admission, consultation, and daily visit codes. SHM appreciates the time spent by these hospitalists. We hope that as the relative values of visits and procedures are reconfigured this input will be helpful.

SHM continues its interest in developing an alternative to the current system that compensates physicians by the unit of the visit. We favor a shift to a broader management fee that better reflects the reality that current inpatient care requires multiple visits each day and a more in-depth approach than is currently captured in a one-visit-and-gone approach.

Medicare’s CCIP Initiative

The Chronic Care Improvement Program (CCIP) is a component of the Medicare Modernization Act of 2003. This program is the first large-scale chronic care improvement initiative under the Medicare fee-for-service program. CMS selected organizations that will offer self-care guidance and support to chronically ill beneficiaries. These organizations will help beneficiaries manage their health, adhere to their physicians’ plans of care, and ensure that they seek or obtain medical care as needed to reduce their health risks.

Performance-based contracting is one of the most important features of the CCIP design. The CCIPs will be paid based on achieving measurable improvements in clinical and financial outcomes, as well as satisfaction levels across their assigned populations. Payment is not based on services provided. CCIP organizations will be paid monthly fees, but those fees will be fully at risk. The organizations will be required to refund some or all of their fees to the federal government if they do not meet agreed-upon standards for quality improvement, savings to Medicare, and increased beneficiary satisfaction levels.

Phase I programs will be large-scale, collectively serving approximately 180,000 chronically ill beneficiaries. This is the phase currently under development. The programs are intended to help increase adherence to evidence-based care, reduce unnecessary hospital stays and emergency department visits, and help beneficiaries avoid costly and debilitating complications and comorbidities. With the attention to reducing hospital costs by reducing unnecessary stays and emergency department visits, hospitalists may play an important role in CCIPs.

Ten organizations in 10 states were awarded opportunities to pilot CCIP programs. SHM believes that hospitalists can play a key role in the CCIP programs and demonstrate efficient and effective care (i.e., better quality at a lower use of resources). SHM has developed a list of its members who are willing to work in the CCIP process and has contacted all of the CCIP awardees to discuss the role of hospitalists in quality improvement.

This is a tangible way that SHM can work with the government and its contractors as pilot programs are funded and developed to improve healthcare at the local level.

SHM: We’re Here for You

The healthcare landscape is changing before our eyes. Whether pay for performance or chronic care improvement or a reworking of the compensation system for healthcare, it’s important that hospital medicine be part of the discussion and decision-making process.

In the near future more than 30,000 hospitalists will practice nationwide, and virtually every hospital will have a hospital medicine program. Hospitalists will be asked to shape and implement the changes that are coming our way. This is our future, and with your help SHM will help you make it a better place for hospitalists, other health professionals, and the patients we serve. TH

Dr. Wellikson has been the CEO of SHM since 2000.

Letter from SHM to the AMA

June 13, 2005

John Nelson, MD


American Medical Association


Dear Dr. Nelson:

The Board of Directors of the Society of Hospital Medicine (SHM) and I strongly oppose the resolution based on Board of Trustees Report 19 that will be heard before the AMA’s House of Delegates later this week.

SHM represents more than 12,000 hospitalists nationwide who are engaged in delivering high-quality inpatient care as well as research, teaching, and leadership related to hospital care. Hospitalists are predominantly young physicians with an average age of 37, and their numbers are projected to exceed 30,000 in the next decade. SHM surveys show that 88% of hospitalists are internists, 9% are pediatricians, and 3% are family practitioners. Hospital medicine is now an important career choice for graduates of these training programs.

The resolution calls for the development of legislation that prohibits lay corporations, including hospitals, from directly employing physicians. SHM studies show that 34% of hospitalists are employed by hospitals and another 10% of hospitalists are employed by hospital medicine management companies. Hospitals often employ or support many different types of physicians including pediatricians, neonatologists, intensivists, emergency medicine physicians, obstetricians, anesthesiologists, pathologists, or radiologists. This is necessary to deliver sufficient care, especially in rural hospitals.

Arguments that physicians employed by corporations or hospitals are always adversely influenced in how they treat patients is false. In fact, numerous studies prove that hospitalists improve quality and patient satisfaction:

Studies in the Annals of Internal Medicine, JAMA, and elsewhere show that hospitalists can improve quality.

—Studies at many hospitals demonstrate that hospitalists improve patient satisfaction as well as the satisfaction of referring physicians.

Primary care physicians, surgeons, and subspecialists increasingly are asking their hospitals to bring hospitalists onto their medical staffs to improve care. Because of the competition for the limited number of hospitalists in the face of the growing need, because of the lower reimbursement for what hospitalists accomplish in improving hospital care, and because hospitalists provide significant uncompensated care (multiple visits in one day, taking patients out of the emergency department), hospitals have had to employ hospitalists to develop successful programs. Enactment of legislation based on the AMA Board of Trustees Report 19 would make it much more difficult for a hospital to attract and retain hospitalists on its medical staff.

I hope you will share our concerns with Reference Committee B.

Thank you for the opportunity to provide the SHM perspective. I hope we can quickly establish a dialogue about the deleterious effects that action on the Board of Trustees Report 19 will have. As are other members of SHM’s leadership, I am available to discuss this further at your earliest convenience.


Larry Wellikson, MD, FACP

CEO, Society of Hospital Medicine

cc: Jim Rohack, MD, AMA chairman of the board

Mike Maves, MD, AMA executive vice president

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