Economic Credentialing

Dr. Joseph Jasper has requested various board members including myself to investigate various issues that interfere with the practice of medicine. I have been assigned the topic of economic credentialing (EC).

The AMA defines ED as “the use of economic criteria unrelated to quality of care or professional competence in determining a physician?s qualifications for initial or continuing hospital medical staff membership or privileges.” Most examples of EC do not fit this definition exactly and so it must be used as a loose term. For example, EC is being applied when a surgeon opens up his own surgery center, resulting in the hospital revoking that surgeon?s hospital privileges, or when a family doctor that practices out of two hospitals, finding that one of the hospitals revoked his privileges.

Economic credentialing sounds like a terrible thing, especially when you are a physician who has had hospital privileges revoked for economic reasons. Most medical societies have issued statements condemning EC, including the AMA, the American Association of Physicians and Surgeons, and the American College of Surgeons. Many states have gotten involved in this battle; eleven states have declared EC illegal, whereas six states have ruled that EC is entirely legal. When doing a web search, one finds that the largest volume of informative sites regarding EC are legal firms. Interesting! Perhaps lawyers have much to gain by the various feuds between hospitals and physicians.

It is informative to first look at both sides of the EC battle. From the hospital perspective, they have the legal obligation to serve all who come. The emergency room is an open door and Hill-Burton regulations force the doors of all hospitals to remain open to all who come. The hospital has minimal recourse for the high consuming, no-ay or underinsured patient, and can not be selective based on ability to pay. Hospitals have had to pay ever increasing sums to attract nurses, physicians and other professionals into their employment. Hospital regulations are onerous, and visits of the JCAHO are an unpleasant and costly experience for the hospital.

Physicians equally are beset with problems. Our practices have been plagued by diminishing reimbursements, accompanied by increasing stress and work hours, depersonalization and absence of malpractice reforms. Our relation with hospitals is increasingly troubled by the “hassle-factor” – scheduled procedures that don?t run on time, equipment that is not available, increasing demands on documentation, ward nurses and assistants that are overworked and not giving patients required attention, committees and meetings, etc., etc., all of which lead to outbursts of anger which are also heavily regulated. To escape the mess of the hospital, to improve declining revenues and to gain control over their schedules, physicians have turned to development of various outpatient facilities. Physicians will usually operate their facilities with far higher efficiency and lower expense than a hospital ever could. Unlike with hospital administrators, management decisions have a direct feedback on ourselves, effecting the amount of hassle and revenues we experience.

Hospitals and physicians are both caught by the EC battle in an effort to survive, and both sides have justifiable reasons for their thinking and behavior. Why should hospitals be friendly to staff physicians that are taking away the most profitable cases and working against the success of the hospital? Why should hospitals be forced to cater to a competitor, when that competitor is a physician? They shouldn?t. Why should physiciansbe friendly to hospitals that are hiring competitors to us that operate in a special protected environment? Why should physicians behave civilly when a hospital fails to provide us a modicum of reasonable service and creates unbearable hassles for us even when we are trying to earn the hospital profits? We shouldn?t.

Physicians could resolve the EC problem by fighting. We could engage hospitals with our bands of lawyers and sue them for restriction of trade. We could engage the state legislature to formalize laws against EC. Regardless of how the EC battle ultimately ends, all of us will lose. Hospitals will become increasingly economically unstable. Physicians will become increasingly embittered, and seek to either leave the state retire early, or retaliate against the hospital by other means. The only winners will be the lawyers, who will profit richly from our legal battles.

Let?s not go there. Make love, not war. Hospitals and physicians must sit down with each other realize that cooperation together will serve both of our interests and then re-invent the practice of medicine. Hospitals need to remove themselves from the notion that they can operate autonomously of physicians. Physicians need to remove themselves from the dream of autonomous private practice. We all need to eliminate the fantasy of “ideal-world” medicine and create new models of physician-hospital interactions.

A new model of health care will eventually take over, driven by economic, government and public forces. It remains to be determined what role physicians and hospitals may play in this brave new world of health care. If the healthcare industry doesn?t acquire a unified stance against those outside forces, we will probably remain at the mercy of these outside forces for the “re-invention” of medicine. The fight over EC blinds us to the big picture, the even larger battles for the viability of healthcare. The battles for prevention of complete government control of medicine, tort reform and spiraling costs of healthcare need to be fought by hospitals in conjunction with physicians – not with us battling each other.

Since writing this article, I am slowly realizing that I am visioning a pipe dream. Perhaps, medicine isn?t worth saving? Perhaps it?s time to just let government have absolute control of medicine. Then, if a physician is unhappy, he can go on strike, like is happening in New Zealand, and as happened recently in Germany. 18JUL08

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