Payers, private equity and pharmacy chains own more physician practices (30.1%) than do hospitals (28.4%).
More than three-quarters of the nation's physicians (77.6%) are employed by hospitals, health systems or other businesses, according to a report commissioned by the Physicians Advocacy Institute.
The new data, compiled by Avalere, reaffirms a decade-long steady transferal of medical practice ownership. In 2012, 25.8% of physicians were employed by hospitals or health systems. Since then, hospitals and health systems have hired nearly 263,000 physicians.
In a five-year span between Jan. 1, 2019, and Dec. 31, 2023, more than 44,000 practices were acquired, although that number slowed in 2022 and 2023, when 8,100 practices transferred ownership.
Currently, 58.5% of physician practices are owned by non-physicians. As of Jan. 1, 2024, physician practice ownership by corporations (30.1%)—including health insurers, private equity firms and large pharmacy chains—surpassed ownership by hospitals and health systems (28.4%) for the first time.
"Corporate entities are assuming control of physician practices and changing the face of medicine in the United States with little to no scrutiny from regulators," PAI CEO Kelly Kenney says in a media release.
"Physicians have an ethical responsibility to their patients' health," Kenney says. "By contrast, corporate entities have a fiduciary responsibility to their shareholders and are motivated to put profits first. In some arrangements, these interests can conflict with providing the best medical care to patients."
The transition to non-physician ownership accelerated during the COVID-19 pandemic as physicians contended with burnout. In 2022 and 2023, 19,100 physicians left independent practices to join hospitals, health systems or corporations. Of those, 16,000 were hired by hospitals and health systems. In the past five years more than 127,000 physicians transitioned to employees of hospitals, health systems or corporations.
"As the medical practice model continues to shift toward affiliated and owned practices, it's absolutely critical that physicians retain autonomy over medical decisions and their relationship with patients remains grounded in providing the best clinical guidance," Kenney said.
Click here for the details of Avalere's methodology.
The new technology provides a better tool to evaluate age-related macular degeneration and other retinal diseases.
Another day, another reminder that artificial intelligence in healthcare is gathering momentum.
A new study from the National Institutes of Health finds that AI takes high-resolution images of the cells in the back of the eye that are processed 100 times faster than when done manually and with a 3.5-fold improvement in image contrast.
Ultimately, researchers say, this new technology will provide a better tool to evaluate age-related macular degeneration and other retinal diseases.
"Artificial intelligence helps overcome a key limitation of imaging cells in the retina, which is time," Johnny Tam, PhD, leader of the Clinical and Translational Imaging Section at NIH's National Eye Institute, says in an NIH media release.
Tam and his team are developing adaptive optics (AO) to improve imaging using new optical coherence tomography (OCT) that is noninvasive, fast, painless, and available in most eye clinics.
"Adaptive optics takes OCT-based imaging to the next level," Tam says. "It's like moving from a balcony seat to a front row seat to image the retina. With AO, we can reveal 3D retinal structures at cellular-scale resolution, enabling us to zoom in on very early signs."
Tam's work targets the retinal pigment epithelium (RPE), a layer of tissue behind the retina that is of particular interest to researchers because many diseases of the retina occur when the RPE breaks down.
Overcoming the Speckle
Imaging RPE cells with AO-OCT are susceptible to a complication called speckle, which Tam says interferes with AO-OCT much like clouds interfere with aerial photography. Currently, clinicians must repeatedly take images until the speckle shifts and allows different parts of the cells to become visible. Clinicians must then piece together the images to create an image of the RPE cells that is speckle-free, a long and laborious process when done manually.
Tam and his team created an AI-based deep learning algorithm called parallel discriminator generative adverbial network (P-GAN) that processed 6,000 manually analyzed AO-OCT-acquired RPE images, each paired with its corresponding speckled original. The network was trained to identify and recover speckle-obscured cellular features.
When tested on new images, P-GAN successfully de-speckled the RPE images, recovering cellular details. With one image capture, it generated results comparable to the manual method, which required the acquisition and averaging of 120 images.
With performance metrics that assess things like cell shape and structure, P-GAN outperformed other AI techniques, and NIH researchers say P-GAN reduced the processing time 100-fold, while producing images with contrast that was 3.5 greater than before.
By integrating AI with AO-OCT, Tam believes that a major obstacle for routine clinical imaging using AO-OCT has been overcome, especially for diseases that affect the RPE, which has traditionally been difficult to image.
"Our results suggest that AI can fundamentally change how images are captured," Tam says. "Our P-GAN artificial intelligence will make AO imaging more accessible for routine clinical applications and for studies aimed at understanding the structure, function, and pathophysiology of blinding retinal diseases."
"Thinking about AI as a part of the overall imaging system, as opposed to a tool that is only applied after images have been captured, is a paradigm shift for the field of AI."
Healthcare job growth in March outpaced the sector's 60,000 monthly average over the past 12 months.
The healthcare sector grew 72,000 new jobs in March, booking another month of strong job growth and representing nearly one-in-four (23.7%) of the 303,000 jobs created in the larger U.S. economy, new federal data show.
Ambulatory care and hospitals lead in job creation within the healthcare sector in March, accounting for 28,000 and 27,000 new jobs, respectively, while nursing and residential care created 18,000 new jobs, according to the Bureau of Labor Statistics March jobs report.
The healthcare sector has created an average of 60,000 new jobs every month for the past year.
The unemployment rate in the larger U.S. economy held steady 3.8%, BLS says, with 6.4 million people reporting as unemployed in March.
Big job gains in March were also seen in government (71,000), leisure and hospitality (49,000), and construction (39,000).
The average hourly earnings for all employees on private nonfarm payrolls in March rose by 12 cents (0.3%) to $34.69. Over the past 12 months, average hourly earnings have increased by 4.1%. The average hourly earnings of private-sector production and nonsupervisory employees rose by 7 cents (0.2%) to $29.79.
February and March job numbers are considered preliminary by BLS, and subject to revisions.
A digital platform developed at UPMC helps patients prep for surgery and speeds recovery.
Linking a health coach with a smart phone app providing perioperative instructions dramatically improves post-surgery recoveries and reduces readmissions, a new study from UPMC and University of Pittsburgh School of Medicine shows.
The research, published this week in the Journal of Medical Internet Research, shows that patients who used the Pip Care digital platform – an app created through UPMC Enterprises - had hospital stays that were nearly one day shorter than patients who did not, and that readmissions were cut in half in the week post-discharge.
While numerous studies have already shown that surgical outcomes are better when patients comply with perioperative instructions, the study authors note that "ensuring that adherence is easier said than done."
"Verifying that this hybrid digital-telemedicine platform is both easy for patients and clinicians to use and significantly improves patient outcomes and satisfaction with surgery is a welcome clinical advance," says senior author Aman Mahajan, MD, PhD, chair of the Department of Anesthesiology and Perioperative Medicine at Pitt.
Several mobile apps have been launched over the past few years with varying success. The UPMC researchers say that Pip Care is the first to couple a digital platform with one-on-one telehealth coaches who check in with patients and coordinate care.
Pip Care connects with surgery patients early in the "prehabilitation" stage a month or so before their procedures and offers advice on nutrition, physical conditioning, psychological support, and quitting smoking. The app breaks down presurgical instructions into easy-to-understand daily tasks and the care coaches answer questions and keep patients accountable. Pip Care also coaches patients post-surgery, helping them understand discharge instructions, wound care and pain management.
Study lead author Stephen Esper, MD, associate professor of anesthesiology and perioperative medicine at Pitt, director of the UPMC Center for Perioperative Care, and an advisor at UPMC Enterprises, says prepping for major surgery is like prepping for a marathon.
"If you want to perform your best, you don't just show up and run. You have to train first and get your body ready for the stress," Esper says. "It's similar with surgery – by optimizing your health beforehand, you have a better recovery."
Methodology
Researchers compared 128 Pip Care patients who were scheduled for elective abdominal, spine or total joint replacement surgery to 268 peers scheduled for the same surgeries at the same hospitals who did not use Pip Care. The Pip Care patients were enrolled about two to four weeks before surgery and continued using it through four weeks after surgery.
On average, Pip Care patients remained hospitalized after surgery for 2.4 days, while non-Pip patients stayed for 3.1 days. Pip Care patients had a 49% lower risk of being readmitted to the hospital within a week of discharge, compared to their non-Pip counterparts.
The patients who received Pip Care averaged 6.7 sessions with their digital health coach, with 82% attending sessions at least once a week. In follow-up surveys, patients reported high – 4.8 out of 5 points – scores for satisfaction with the app.
"Many health systems are facing considerable staff shortages and one of the consequences is that clinical teams, who are dedicated to their patients' success, have limited time to provide focused, patient-specific surgical optimization," says Mahajan, who is also senior vice president of health innovation at UPMC Enterprises.
"By partnering with health systems and hospitals Pip Care is providing patients a sense of connection and a better understanding of their surgical journey, prompting them to actively engage in their health and those patients have better surgical outcomes."
The full effect of the Change Healthcare hack has yet to be measured.
Hospital Margins averaged 3.96% in February, continuing a strong trend in 2024. However, the data collected for February from more than 1,300 hospitals nationwide do not reflect the total effect of the Feb. 21 Change Healthcare hack, Kaufman Hall says in March National Hospital Flash Report.
While the numbers are generally favorable, especially when compared to those of the pandemic era, Erik Swanson, senior vice president of Data and Analytics at KH says hospitals aren't in the clear.
"Robust hospital margins in February demonstrate continued recovery from the pandemic years, but challenges are on the horizon," Swanson says. "The aftermath of the Change Healthcare cyberattack and continued competition from industry disrupters may test financial performance in coming months, as disrupters capture more profitable, lower-acuity, and lower-capital-intense services from hospitals."
The flash report also notes that gross revenue continues to rise at a faster rate than net revenue, highlighting payer mix changes, while bad debt and charity care have also risen over the last few years. And while revenue growth is primarily being driven from the outpatient setting, the ongoing decline in inpatient revenue continues.
In the aftermath of the Change Healthcare hack and its effect on provider cash flows, KH notes that cybersecurity has become a top priority of hospital leaders, who are still sorting out the operational implications.
With that in mind, KF recommends that hospitals:
• Prioritize steps to preserve liquidity, including extending accounts payable, slowing capital spending, drawing on lines of credit, or liquidating assets such as T-bills;
• Monitor denial rates as claim backlogs lessen. If denials spike, manage the processing backlogs as well as possible; determine the impact of delayed claims on cash, both for operations and balance sheet metrics;
• Anticipate interest in cybersecurity in future rating presentations, paying special attention to how they are dealing with cyber hygiene and the risk of contamination in interactions with third-party vendors.
• Diversify clearinghouses and banking partners to diminish counterparty concentration risk;
• Anticipate rating pressures on lower-liquidity credits, although wholesale rating downgrades are not likely.
The suit says diabetes care costs the Hoosier State $5 billion annually.
IndianaAttorney General Todd Rokita has filed suit against several of the nation's largest drugmakers and pharmacy benefit managers for allegedly conspiring to inflate insulin prices.
"Diabetes is a public health crisis for Hoosiers," Rokita says, noting that 640,435 Indiana residents have diabetes -- more than 12% of the state's population -- and more than 1.7 million are pre-diabetic. Diabetes is the seventh-leading cause of death in Indiana and the leading cause of blindness, kidney failure, and lower limb amputations.
The complaint claims that direct medical expenses associated with diabetes in Indiana are around $5 billion annually and that, if diabetics adhered to their medication protocols, more than $8.3 billion in direct medical costs would be saved each year.
"This is a serious condition that requires insulin, putting patients in the impossible position of choosing between health and financial security," Rokita says.
Named in the lawsuit are drugmakers Sanofi-Aventis and Novo Nordisk and PBMs CaremarkPCS Health, Express Scripts, CVS Health Corp., and Optum RX. The suit, filed in Lake County Superior Court, alleges that the companies conspired to raise prices on insulin medications by more than 1000% in the last decade despite manufacturing costs decreasing.
Several of the companies named in Indiana complaint face similiar allegations in a lawsuit filed last year by California Attorney General Rob Bonta.
The suits are proceeding despite numerous reports suggesting that insulin prices peaked in early 2023 and have since declined significantly.
"Too many Hoosiers have been forced to ration because drug manufacturers and PBMs have prioritized profits over patients," Rokita says. "Hundreds of thousands of Indiana residents rely on these medications to stay alive and these prices discourage people to take care of their health. Our office hopes this case will also set a strong precedent for other pharmaceutical companies who want to take advantage of everyday Hoosiers."
This is not Rokita's first clash with Big Pharma. He won a $66.5 million settlement against Centene for their failure to disclose true costs, took part in a $573 million multi-state settlement against McKinsey & Company for its role in "turbocharging" the opioid epidemic with Purdue Pharma, and secured nearly $7 million in an Indiana Medicaid fraud settlement against Mallinckrodt.
Nearly one-third of providers say the turnaround time for primary source verifications takes one month or longer.
Clinician credentialling remains a pricey sticking point for many providers, nearly half of whom say that error-prone, manual processes they often rely on are costing them money, a new report shows.
Medallion, the San Francisco-based credentialling and provider network management company, says 46% of the 337 provider-based healthcare businesses that responded to its survey reported that inefficiencies in enrollment workflows created costly delays that adversely affected their bottom lines.
"This report dives into how much time is spent on administrative tasks rather than patient care," Derek Lo, CEO and founder of Medallion, said in a media release. "It also highlights the collective optimism and support our industry has for technology solutions that help speed up these processes and eliminate wasteful tasks."
While noting that the timeliness of reimbursements depends upon the payer, Lo says providers aren't helping the process with slow turnaround times from onboarding to application submissions.
Ultimately, the report notes, nearly one-third of respondents say the turnaround time for their end-to-end primary source verifications takes one month or longer.
The report also notes that:
52% of respondents reported entirely manual credentialing workflows, including provider data collection, application receipt, credential file creation, review, primary source data verification, committee evaluations and approvals.
Nearly 40% of providers reported moderate reliance on manual processes in their payer enrollment workflows. Beyond that, 69% of providers rely on two or more software tools to complete enrollment.
57% of providers saw turnover and staffing challenges in their credentialling teams during the past year. The report notes that turnover in credentialling is higher than in other healthcare administrative areas, and that these staffing fluctuations delay credentialling, delay in-network patient care, and delay payments.
Nearly 60% of respondents spend more than four hours on primary source verifications, which are only a single step in the multi-step credentialing process.
Healthcare job growth in February outpaced the sector's 58,000 monthly average over the past 12 months.
The healthcare sector booked 67,000 new jobs in February, continuing a years-long trend of strong job growth and representing nearly one-in-four (24.3%) of the 275,000 new jobs created in the larger U.S. economy, new federal data show.
Ambulatory care and hospitals lead in job creation within the healthcare sector, each accounting for 28,000 new jobs in February, while nursing and residential care created 17,000 new jobs, according to the Bureau of Labor Statistics monthly jobs report.
The unemployment rate in the larger U.S. economy ticked up 0.2% to 3.9%, BLS says, with 6.5 million people reporting as unemployed, up 334,000 from January. In February 2023, the jobless rate was 3.6%, with 6 million unemployed.
Big job gains in February 2024 were also seen in government (52,000), food service (42,000), social assistance (24.000).
The average hourly earnings for all employees on private nonfarm payrolls in January rose by 5 cents (0.1%) to $34.57. Over the past 12 months, average hourly earnings have increased by 4.3%. The average hourly earnings of private-sector production and nonsupervisory employees rose by 7 cents, or 0.2%, to $29.71.
February and January job numbers are considered preliminary by BLS, and subject to revisions.
A bipartisan coalition of 39 AGs wants Congress and the FTC 'to ensure fulsome regulation of PBMs nationwide.'
The National Association of Attorneys General is urging Congress to pass legislation that cracks down on "deceptive practices" used by pharmacy benefits managers that allegedly drive up the costs of prescription drugs for consumers.
"The PBMs' original purpose was to protect and negotiate on behalf of employers and consumers after pharmaceutical manufacturers were criticized for overpricing medications," the letter states. "Unfortunately, in recent years, the PBMs have only made the pharmaceutical market more opaque and have been a cause of rising drug prices."
The AGs claim that a "small number of PBMs hold significant market power and are reaping abundant profits at the expense of the patients, employers, and government payors the PBMs are supposed to help."
"Pharmaceutical buyers and sellers have little choice but to employ PBMs, allowing them to extract both monopoly profits from individuals and monopsony profits from the market. Moreover, PBMs often dictate reimbursement rates and rules to independent pharmacies, making it difficult for many to survive," the letter states.
States Take the Lead
The AGs noted that states have already taken actions to cut down on PBM abuses that are "often more stringent than federal law," and they urged Congress to follow their lead.
"For example, in 2018 and 2019, respectively, Ohio and Arkansas passed legislation prohibiting spread pricing, in which a PBM charges payors such as Medicare more than they pay the pharmacies supplying the medication, keeping the difference for the PBM," the letter states. "The U.S. House of Representatives also passed legislation barring spread pricing for Medicaid just this month, but it is still awaiting a vote in the Senate."
Without federal law supporting state action, the AGs say, "PBMs routinely try to evade state law and obstruct state regulatory efforts by refusing to disclose data to state regulators as well as their own clients (i.e., health plans operated by employers and the government)."
"Thus, the FTC and Congress must act to ensure fulsome regulation of PBMs nationwide," the letter states. "Such legislation should reform PBM practices to curtail their ability to unreasonably raise the price of drugs and to require greater transparency.
Such transparency should, among other things, require PBMs to produce pricing data to health plans and federal and state regulators in a standardized format. This will enable health plans to negotiate better deals with PBMs and will allow regulators to better hold PBMs accountable."
PBM Push Back
The Pharmacy Care Management Association, the lobbying arm for PBMs, has complained that it is being unfairly scapegoated for high drug costs that are set by drugmakers using anti-competitive tactics such as extending drug patent monopolies.
"Make no mistake, drug companies' constant blaming of pharmacy benefit companies is designed to avoid accountability and further boost profits and pricing power," the PCMA says.
Instead, the PBMs want Congress to pass S. 3583, a bill that would crack down on drug company patent thickets, which PBMs have called "a common drug company anti-competitive tactic to stifle competition."
The PBMs also pointed to a proposed "delinking" effort by drug makers that would ban PBM compensation in Medicare Part D from being tied to a drug's list price, essentially restricting the proprietary terms between PBMs and payers.
A Matrix Global Advisors study cited by the PCMA estimates that delinking "would boost drug company profits by $32 billion annually in the Medicare and commercial health insurance markets, while increasing healthcare premiums for patients by nearly $40 billion."
PCMA also cited its own 2023 analysis that used Centers for Medicare & Medicaid Services data showing that the price increases for the top 250 brand-name drugs in Medicare Part D by total spending in 2020 were unrelated to rebates.
"Congress should reject drug companies' self-serving blame game, and instead focus on solutions to encourage greater competition in the prescription drug market that would lower costs for patients," PCMA says.
The initiative aims to reduce costly up-front, out-of-pocket prescription drugs costs for seniors.
The Centers for Medicare & Medicaid Services this month issued a second round of draft guidance for the Medicare Prescription Payment Plan and its requirements for organizations participating in Part D.
The draft guidance for the plan, which launches in 2025, is mandated by the Inflation Reduction Act, and aims to reduce the pricey upfront out-of-pocket prescription drug costs for seniors and disabled people enrolled in Part D by allowing them to spread costs over a year rather than in one lump sum.
"Too many seniors and people with disabilities can't afford to fill their prescriptions at the pharmacy – and that is unacceptable," Health and Human Services Secretary Xavier Becerra says.
"In addition to adding flexibility through a payment plan, the law cuts drug costs through provisions such as caps on out-of-pocket costs and the cost of insulin, and a mandate on drug companies to pay a rebate to Medicare if they raise prices faster than inflation," Becerra says.
The second draft guidance details the outreach, education, and communication requirements for organizations to ensure that Medicare Part D enrollees are aware of the MPPP.
CMS is also planning a national education and outreach initiative targeting pharmacies, providers, and beneficiary advocates, to acquaint them with the program and ensure that they have the needed support and materials.
Meena Seshamani, MD, PhD, CMS deputy administrator and director of the Center for Medicare, says MPPP "helps alleviate cash flow issues for people who face high out-of-pocket costs early in the year that may prevent these individuals from taking a drug that could keep them healthy."
"The draft guidance we have released is a blueprint to help operationalize this program to ensure both healthcare organizations and people with Medicare are empowered and educated," Seshamani says. "That way, people in Medicare can make the best choices for their health and financial needs."
On Jan. 1, 2024, the IRA expanded eligibility for Part D's Low-Income Subsidy program – also known as "Extra Help." So far, the program has enrolled about 300,000 low-income people, and CMS estimates that another 3 million people are eligible but have yet to enroll.
Before finalizing the guidance, CMS is soliciting public feedback in a comment period that expires on March 16. Comments should be sent to PartDPaymentPolicy@cms.hhs.gov with the following subject line: "Medicare Prescription Payment Plan Guidance – Part Two."
