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|How value-based medicine can impact physician recruitment - Summer/Fall 2016|
By Marcia Horn Noyes, contributing writer for the Journal of ASPR
Upwards of 50 to 100 physician recruitment agreements pass across the desk of Pennsylvania attorney Dennis Hursh annually. As he examines and reviews contracts for physicians preparing to be employed by an organization or joining a community practice, Hursh looks for legal language that could potentially impact that doctor’s financial future and lifestyle. Within those evaluations, he has seen the fair, not so fair, and thoroughly unfair agreements tendered to physicians.
Physicians often ask attorneys like Hursh to step in during the contract phase of the negotiations because, while they’ve spent seven to nine years honing medical skills, the business side of health care hasn’t been a priority.
Today, the health care landscape is undergoing cataclysmic change in reimbursements, and Hursh points out that efforts made by providers and payers toward value is now being reflected in many physician recruitment agreements. “In the ‘good old days,’ doctors received a base salary with some sort of incentive compensation,” he mentions. “While many of the contracts I review today still have incentive compensation, I’m seeing a higher percentage of contracts where the base compensation has some portion at risk.” Hursh adds that he has seen some cases where the hospital or group practice withholds as much as 24 percent of salary, should the doctor not meet the value production stipulated in the contract.
Uncertainty from every angle
This pessimistic financial view may give some clue as to why employers are sharing a portion of that risk and why some physicians and their attorneys are apprehensive of the move to value-based medicine. “They do so because ‘they can,’” says Hursh. “And because doctors often sign the first thing put in front of them, employers see a way to shunt a portion of that risk onto doctors.” In many cases, Hursh says unreasonable amounts of risk are being funneled the physician way. “Some large hospital systems are even inserting an indemnification clause that appears to be broad enough to cover malpractice, fraud and abuse, and other areas that should be covered by insurance or by robust compliance plans.”
Physician recruitment professionals caught in the middle
1. Explain the risk.
While physicians may not see the red flags of productivity and value-based contracts, their attorneys surely will. Providing clarity around the hospital/practice risk as well that of the physician may help solidify a contract that hangs in the balance. Physicians work hard, so they often feel productivity and value incentives are within reach. However, attorneys may advise their clients of the unknowns, such as finding out how many more physicians have or will be recruited that may compete for the same patients in the effort to achieve those incentive goals.
2. Enlist help of a department head or another physician in the practice.
Hursh says, “Many times a recruiter can persuade another doctor to put himself or herself into the shoes of the physician being recruited and help out with contract concessions.”
3. Recognize ambiguity in value parameters.
Sometimes the value parameters can be inappropriate for a given specialty. Hursh has provided an example from a recent negotiation: “A health system had been putting productivity requirements on all its physicians, but I convinced a physician in the system that productivity really wasn’t appropriate for my client,” who Hursh mentions was an emergency medicine physician.
What the future holds
Whether physicians will embrace this industry transition while shunning the impact it has upon their recruitment agreements is yet to be determined. Hursh indicates it could have unintended consequences to the pool of available doctors.
In the end, one thing is certain — value-based care that provides a better patient experience is here to stay. Helping doctors understand that this is not just a passing trend will go a long way toward understanding the changes in physician recruitment agreements.