National hospital chain Tenet Healthcare is considering replacing local independent doctor groups with a large national physician staffing company at some or all of its 12 California facilities.
Doctors in Orange County and across the state fret that bringing in an entirely new group from out of state to manage three different sets of physicians could disrupt established relationships between them and their hospitals and usher in a new era of penny pinching that would reduce staff levels and doctors’ pay.
Earlier this year, Tenet notified medical staff at its California hospitals that it was thinking about terminating current contracts with emergency room, anesthesiologist and hospital specialty doctor groups in order to bring in a single company that could provide physicians for all of those functions. It has solicited and received bids for the proposal.
The California Medical Association, physician associations and the medical staff leaders at some of the Tenet hospitals have weighed in against the plan.
Hospitals hoping to bolster revenue and operate more efficiently have been turning to these one-stop doctor shops for quite some time. And it could become a growing trend as changes under the Affordable Care Act accelerate the consolidation of hospitals and medical practices into ever-larger entities.
Doctors have been engaged in intensive discussions with Tenet in recent days, hoping to persuade the company not to follow through with its plan. They say that the company has not consulted sufficiently with the physicians who are potentially affected by the possible staffing changes.
“A lot of people are partners in their medical group, are vested in their medical group, and Tenet is just ignoring that,” said Marc Futernick, president-elect of the California chapter of the American College of Emergency Physicians.
“It’s like saying to Coke, ‘We are going to change you to Pepsi. Everybody will stay; they just care about cola,’” Futernick mused. “But I think many physicians will leave, especially if they are part of a group that is bigger and has other contracts. I think some of the physicians will stay, but at greatly reduced pay rate – especially if they have fewer options.”
A statement issued earlier this week by Tenet’s three Orange County hospitals – Fountain Valley Regional, Placentia Linda and Los Alamitos Medical Center – said that they had in fact “sought the input of our medical staff leadership” by “arranging for them to meet with several highly qualified potential physician groups, including groups who have provided outstanding services at our hospital for many years.”
The hospitals said they were “confident that the groups selected will be those that can best meet the needs of our patients, our medical staff and our community.”
Tenet also owns Lakewood Regional Medical Center.
There is some confusion over the scope of Tenet’s plan. Doctors working in Tenet hospitals said they believed the staffing change would be at all of the company’s California hospitals. A spokesman for Tenet, however, said, “some of the hospitals may choose to remain with their current physician groups.”
Nonetheless, Tenet has at least three large physician staffing companies bidding for the business and ready to jump in: EmCare, a Dallas-based company with $3.7 billion in revenues; Team Health, a $2.4 billon Knoxville, Tenn., company; and Apollo MD, a privately held firm headquartered in Atlanta.
The three companies “did come through at each of the hospitals and explained what they planned to do,” said Peter Anderson, director of the emergency room at Fountain Valley Regional, who also has the contract to run the ER at Placentia Linda.
“Each of these groups said they are going to try to keep all the physicians and try to maintain the pay scale,” he said. “But the bottom line is that a lot of my doctors have had experiences with these large groups and in many cases the experience has not been positive, so they have questions.”
EmCare spokesman Ron Cunningham confirmed that his company has submitted a bid for the Tenet staffing plan.