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ONLINE EXCLUSIVE: Subsidy or Investment?


 

Branding is defined by Merriam-Webster as the promotion of a product or service tied to a particular brand. Most hospitalists say HM has done a good job branding itself as the go-to physician specialty for patient safety and quality-improvement (QI) initiatives.

But labeling the financial support payments that help pay for that service as a subsidy?

“It’s a horrible branding exercise,” says Troy Ahlstrom, MD, SFHM, chief financial officer of Hospitalists of Northern Michigan, a hospitalist-owned and -managed group based in Traverse City.

The monies that change hands between hospitals and HM groups have long been known as subsidies, with one consulting group’s marketing materials giving advice on why subsidies are necessary. Hospitalist John Bulger, DO, FACP, FHM, of Geisinger Medical Center in Danville, Pa., says the payments must be viewed the same as financial agreements with other specialties, which rarely are viewed as subsidies.

If you believe like I do that [hospital support payments] actually are a value-added tool that brings a return to the hospital, then we just have to do a better job of figuring … a methodology across the industry to showcase value. —John Bulger, DO, FACP, FHM, hospitalist, Geisinger Medical Center, Danville, Pa.

“I would like to see us move toward more of a discussion of an investment,” Dr. Bulger says. “If you believe like I do that it’s actually a value-added tool that brings a return to the hospital, then we just have to do a better job of figuring … a methodology across the industry to showcase value.”

Todd Nelson, a technical director at the Westchester, Ill.-based Healthcare Financial Management Association, says hospitals value groups that can provide definable progress in core measures tied to patient safety and QI programs. And when it comes to funding those proactive physician groups, hospitals understand there is a cost of doing business.

“From the hospital perspective, they’re looking at it more as an investment,” says Nelson, a former chief financial officer at Iowa’s Grinnell Regional Medical Center. “They’re looking to engage the physicians. … Patient care is more than showing up and taking care of the patients.”

Richard Quinn is a freelance writer based in New Jersey.

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