Practice Economics

Holdout Hospitals


 

I think 70% to 80% of U.S. hospitals now have a hospitalist practice. (Some have more than one hospitalist group operating within their walls.) I arrived at this estimate by relying on both my anecdotal experience and on the annual American Hospital Association survey, which in 2009 showed 58% of hospitals have hospitalists, with an ongoing rapid rate of adoption.

No regular reader of The Hospitalist should be surprised that most U.S. hospitals now have hospitalists, but some might be surprised that 20% to 30% don’t. There are about 5,800 hospitals in the U.S. (a ballpark figure), so that means about 1,100 to 1,800 don’t have hospitalists. What is unique about them?

For some hospitals, the answer is easy. For example, the U.S. has something like 450 psychiatric hospitals. They vary a lot, but many simply don’t accept patients with active medical problems, so these facilities would have little need for medical hospitalists.

Variations in how the term “hospitalist” is used probably account for some facilities reporting no hospitalists. For example, long-term acute-care hospitals (LTACs) might have dedicated inpatient providers but simply don’t call them hospitalists.

Even accounting for these things, there are still a lot of “med-surg” hospitals that say they don’t have hospitalists.

The Holdouts

My experience suggests the two most important reasons some hospitals have not yet developed a hospitalist practice are an oversupply of primary-care physicians (PCPs) and an attractive payor mix in the unassigned patient population. In fact, it is hard for me to imagine a hospital that enjoys both of these attributes ever being able to support hospitalists.

Although it isn’t a common problem, an excess of PCPs (or dearth of patients) removes the most universal and powerful stimulus to develop a hospitalist practice: the desire of PCPs to be relieved of hospital work. And in most cases, those PCPs can offset the loss of hospital work and its associated revenue, with more work in the office. This can mean a better lifestyle (e.g. no trips to the hospital on nights and weekends) and the same or higher income. But if there are too many PCPs in the community, they may be unwilling to give up the hospital work, as there might be no way to replace it in the office. End result: no hospitalists.

I think hospitalists are critically important for nearly all med-surg hospitals; however, maybe there will always be a small number that either have PCPs continue to practice in the traditional model, working both outpatient and inpatient, or some other effective configuration that makes hospitalists less necessary. We’ll have to wait and see.

For the rare hospital that has an attractive ED-unassigned payor mix, PCPs are more likely to want to continue taking ED call and not support a proposal to develop a hospitalist practice. And access to the ED call roster can be important to new PCPs building a community practice. I have seen situations in which a hospital has addressed the poor reimbursement of unattached ED admissions by paying PCPs to provide that care. Even though that same hospital might want a hospitalist practice, the ED call payment it is providing to PCPs may create a barrier that can’t be overcome. Such a hospital will face the very difficult decision of terminating the payments for ED call and redirecting that money to a hospitalist practice—something that is likely to lead to a lot of frustration on the part of PCPs who depend on the pay-for-call arrangement. A common outcome: no hospitalists.

An occasional reason hospitals are late to the hospitalist party is one or two (rarely more than that) of its private PCPs have simply chosen to work heroic amounts, and in addition to office and hospital care of their private patients, they accept referrals from other PCPs. I have met a number of doctors like this. Some are terrific doctors who actively participate in hospital initiatives; many appear chronically tired and harried, and hospital staff express frustration that they do things like make rounds at 3 a.m., take hours to respond to urgent calls, refuse to use protocols, etc. But because they’ve responded to the PCPs’ desire to be relieved of hospital work, other doctors may rally to their support and prevent the hospital from moving forward with a hospitalist program.

Will Every Hospital Have Hospitalists Eventually?

It is really interesting to think about whether every hospital, outside narrow specialty hospitals, will have hospitalists in the future. I wonder what informed people in the 1970s and early 1980s were predicting for emergency medicine’s future. At that point it probably wasn’t clear that, in the future, dedicated ED doctors essentially would staff every ED in the country, but I think that is exactly what has happened. (I once worked with an approximately 100-bed rural hospital that didn’t have ED physicians until 1999. I wonder if they were the last adopter.)

I think hospitalists are critically important for nearly all med-surg hospitals; however, maybe there will always be a small number that either have PCPs continue to practice in the traditional model, working both outpatient and inpatient, or some other effective configuration that makes hospitalists less necessary. We’ll have to wait and see. But I’m pretty confident

that almost no institutions that have hospitalists will ever return to the pre-hospitalist model of care. It seems there is no going back.

For those hospitals without hospitalists currently who will at some future time have hospitalists, the right time for this to happen is dependent on a combination of local factors. It could be something like the departure (i.e. relocation or retirement) of some of the current doctors, or simply the arrival of someone who has a vision and energy to successfully navigate the obstacles to build one. TH

Dr. Nelson has been a practicing hospitalist since 1988 and is co-founder and past president of SHM. He is a principal in Nelson Flores Hospital Medicine Consultants, a national hospitalist practice management consulting firm (www.nelsonflores.com). He is also course co-director and faculty for SHM’s “Best Practices in Managing a Hospital Medicine Program” course. This column represents his views and is not intended to reflect an official position of SHM.</p>

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