by
Loren Bonner, DOTmed News Online Editor | September 01, 2013
From the September 2013 issue of HealthCare Business News magazine
Late last month, I attended a symposium focused on the changing hospital landscape. Fittingly, it was right around the time when Mount Sinai Hospital in New York announced its merger with Continuum Partners - the owner of three major hospitals in the city: Beth Israel Medical Center, St, Luke's Hospital and Roosevelt Hospital. It was big news locally and in health care circles nationwide.
In fact, Mt. Sinai's chief financial officer, Donald Scanlon, was on one of the panels at the symposium and spoke briefly about the planned merger. He said the move, which was in the works for the past two years, signaled Mt. Sinai's shift toward primary care.
"We're on our way to becoming a highly integrated practice," Scanlon told the room packed full of attendees, most from New York area health systems.
But of course, Mt. Sinai's merger signals much more than a shift toward primary care. Hospitals across the country are merging at a rapid pace and, for the most part, it's a result of health reform, which is changing how hospitals are paid and how much they are paid.
"We are all starting to integrate in ways we didn't think possible," Joel Perlman, chief financial officer at Montefiore Medical Center in New York, who also spoke on the panel, told the audience.
But the concern from many is that these large systems, which are sure to be the new norm, will only raise the cost of health care.
Brian Klepper, who I interviewed recently, put it in perspective. He referenced what has resulted from consolidation already happening over the past few years when hospitals have been putting as many services as possible under one roof. He says: "Many primary care physicians acquired by health systems have been incentivized to refer into the mother ship as often as possible for images and other diagnostics, and certainly for possible procedures. Under this widespread scenario, the cost of primary care services has skyrocketed compared to what it was when independent primary care physicians provided them. And the rate of unnecessary and inappropriate utilization has also risen, with horrendous cost consequences."
Writing about the shifting hospital landscape has always been an interest of mine. One of the first stories I covered as a rookie reporter was the closure of a small community hospital in Brooklyn. That was many years ago, but the trend still holds true and will only be accelerated. Hospital and health system changes will be an interesting story to follow these next few years.
