Tennova had outsourced its emergency rooms to American Physician Partners, a medical staffing company owned by private equity investors. APP employs fewer doctors in its ERs as one of its cost-saving initiatives to increase earnings, according to a confidential company document obtained by KHN and NPR.
This staffing strategy has permeated hospitals, and particularly emergency rooms, that seek to reduce their top expense: physician labor. While diagnosing and treating patients was once their domain, doctors are increasingly being replaced by nurse practitioners and physician assistants, collectively known as “midlevel practitioners,” who can perform many of the same duties and generate much of the same revenue for less than half of the pay.
For Private Equity, Dropping ER Docs Is a ‘Simple Equation’
Critics of this strategy say the quest to save money results in treatment meted out by someone with far less training than a physician, leaving patients vulnerable to misdiagnoses, higher medical bills, and inadequate care. And these fears are bolstered by evidence that suggests dropping doctors from ERs may not be good for patients.
Two firms dominate the ER staffing industry: TeamHealth, bought by private equity firm Blackstone in 2016, and Envision Healthcare, bought by KKR in 2018. Trying to undercut these staffing giants is American Physician Partners, a rapidly expanding company that runs ERs in at least 17 states and is 50% owned by private equity firm BBH Capital Partners.
It is obvious to me that the best way to undercut competition is to severely limit physicians in the ER. A race to the bottom of healthcare.
Such a study is very mixed. My dad back in the 1950s was trained as a doctor. Of course a nurse today would be better trained.
As far as mistakes hurting patients that is mixed in such a study as well.
For instance who is in charge is the biggest problem. With concierge patient care the hospitals faced a horrible mess. It rarely ever worked for the patients.
To have nurses and other mid level care workers in the ER you have at least one doctor running them. It is not all doctors being removed. The hierarchy remains.
Communication to get things ordered may be hurt. Just as concierge hurt communications the thing it was supposed to help.
The main reason to do this has little to do with excluding doctors or cutting costs. Instead it creates a reason to up billables for mid level workers to insurance companies and Medicare. Most shifts that are not new treatments are to find new ways of structuring Medicare billables which in turn change private insurance billables.
After Covid the costs of mid level care have risen. To meet that these extremely well trained people need to be used in new ways to gain billables.
This isn’t really a problem with capitalism. This is a problem with our inadequate PUBLIC healthcare systems. Capitalism has simply filled the void of needs unmet (and as discussed in another thread - shareholders are more important than customers when it comes to for-profit corps).
You will generally find more affluent areas covered by non-profit hospitals and more for-profit facilities in rural and lower economic areas - primarily because the non-profit orgs have departed rural communities due to a lack of funding.
That’s why this article opens with a story about Clarksville TN, pop 170k, serviced by this single for-profit hospital but by comparison a little further south, Nashville has many non-profit options.
If we had a more robust public health option, there would be no need for a for-profit solution for these communities - who often would have no local immediate care options otherwise.
Kalamazoo, MI, county population of 261K, has two hospitals. Both are nonprofit. When I first retired, I looked at ACA plan cost in Kalamazoo, Grand Rapids (Kent County population 658K), and here in metro Detroit. ACA plans in Kalamazoo cost significantly more than either GR or Detroit. Seems the factor is not being a nonprofit, but a lack of competition due to small community size.
Somewhere during the last couple weeks, someone commented “capitalism, without competition, leads to extortion”