Innovations in Health Care will never come from Hospitals

by admin on 02/20/2019 8:23 PM

Hospitals will always expand, merge, consolidate or metastasize.

Innovations will usually be accidental, but will increase cost of healthcare.

This will increase the cost of health insurance and increase the insurance carrier’s profit.

To reduce health care costs is not part of their DNA

Hospitals are business enterprises without which sophisticated healthcare would plummet. Without hospitals we would not have the sophisticated surgical suites which do heart surgery, transplants, trauma and other sophisticated surgery. Many lives would needlessly be lost without hospitals.

Like all businesses, they have to be concerned with growth and the bottom line on their financial statement. Advertising for more sickness is a tough decision. Advertising for more sophisticated and profitable equipment is highly praised by the community. Hence, there is an incentive towards multimillion-dollar scanners and robotic equipment. Hospitals became sophisticated centers competing with the university medical centers.

Hospitals in the early to mid-twentieth century, courted practitioners to obtain admission privileges which were free. The benefits accrued to the Hospitals which consider their medical staffs a valuable asset.  They then began seeing themselves as an asset to physicians. This then led hospitals to see physicians as a revenue source and proceeded to charge staff dues.

As the diagnostic equipment became more reasonable in price, it became more available to private doctor offices. As medical practices were enlarging, they began obtaining their own diagnostic x-rays, scanners, and robotics. This created a dissention between hospitals and group medical practices. This dissention became very competitive. The private practitioners still needed the hospitals for their more sophisticated diagnostic capabilities. They continued to acquire and maintain hospital privileges. As more procedures became safe in free standing surgical centers, large group practices developed sophisticated surgical centers. This decreased the hospital’s outpatient business. The competition then turned somewhat ugly. The Surgical Center near my office was given an offer they found difficult to refuse. The hospital offered to purchase the surgical center, or they would build their own surgical center next door. The surgeons caved.

The hospitals now had the upper hand because they became diagnostic centers themselves and thus physicians competed for privileges. The hospitals began acquiring physicians through their foundations since hospitals could not directly employ physicians. They began increasing hospital dues, which have increased dramatically and became restricted.   The dues for their own physician groups were paid by the foundation. Private practitioners’ dues in one hospital in Sacramento increased to $10,000 according to one source which required anonymity. This effectively eliminated most private practitioners from having a hospital practice. Hospitals meanwhile had developed a new specialty, “Hospitalists,” during the HMO period which were now available to care for all their inpatients.

As hospitals became rather sophisticated medical centers, they also because referral centers.  The regional Universities center lost their referral base and entered into competitive outpatient practices by establishing medical office buildings (MOB) throughout the community as feeders to the university. They hired physicians from the community who normally used the local hospitals. Some found their patients rebelling on being referred to and hospitalized in a more distant university hospital.

These rather significant changes in medical practices and the effect on overall healthcare has not yet been fully explored or studied. It does not follow the Lean practices as defined by James Womack in 2008 nor does this follow any innovative protocol or procedures.

HPUSA was organized more than a decade ago. It was apparent that no innovation would come from any member of the Hospital/Insurance/Government/Organized medicine complex. The initial group met four hours every Thursday to develop an innovative plan. With advent of top down coercion of the complex, the incubator group disbanded. With the current healthcare issues in total disarray and being administrative driven, perhaps this incubator group should reassemble or even enlarge. However, this would require some deep pockets outside of the complex to seriously consider the options for a truly innovative healthcare system.

We invite you to respond in this column or the following HPUSA column for participation. This column can be contacted through DelMeyer@HealthPlanUSA.net

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The majority of alleged innovations do NOT improve healthcare.