Doctor practice consolidation and pay: A congressional report

Annual Pay Physician Specialties chart
How much do doctors get paid?

Consolidation of doctor practices inside and outside of hospitals: it’s a big topic these days. Why is it important? Among other things, if a procedure is performed at a doctor’s office, it is reimbursed by Medicare at one rate; if it’s performed at a hospital, it’s reimbursed at another rate. The hospital rate, not surprisingly, is higher.

Here’s a report on market consolidation by physicians by the Congressional Research Service.

One of the interesting things it contains is the doctor pay report, by specialty, revealed at the right; you can really see how family practice and pediatrics are at the bottom of the barrel, and orthopedics, plus invasive cardiology, are right behind. As a snapshot of how the medical system values certain skills and talents, this speaks volumes.

Back to consolidation:

“Rising health care costs have led to federal, state, and private efforts to rein in medical spending,
including controlling physician payments and providing incentives for consolidation to realize greater efficiency,” writes the author, Suzanne M. Kirchhoff. “One question surrounding affiliation between physicians and other health organizations such as hospitals is whether they will help to reduce costs. There is concern that such affiliations could instead lead to higher prices for consumers and the government as the
larger entities gain negotiating leverage with insurers and can charge more for some Medicare-covered services. To date, studies have provided mixed results on whether closer affiliation improves efficiencies and leads to reduction in prices for health care services.”

We hear a lot about the so-called “facility fees,” and other related price increases, in articles like this one from David E. Williams on MedCity News and this one from Reed Abelson and Julie Creswell in The New York Times about consolidation and hospitals in Boise, Idaho. The news for consumers is not often pretty.

An interesting point about this report: I found it on the Federation of American Scientists blog called “Secrecy News.” Among the things they do is make public reports that Congress or other agencies have chosen not to disseminate.