When doctors become employees, things start to get ugly. In City Journal, Dr. Joel M. Zinberg argues that independent practices are becoming increasingly uncommon as newly-minted doctors rush to become employees of hospitals. MDs, says Zinberg, are driven into the open arms of hospital administrators by the expensive and time-consuming overhead of operating their own practices—overhead that the ACA has only increased. Here is the result, according to Zinberg:
Health-care pundits, most of whom have never cared for a patient, argue that shifting the incentive structure away from fee-for-service reimbursement will improve quality and efficiency. The current system, they say, rewards overutilization of resources. Under the new system, hospitals and physicians will bear the financial risk of their costs exceeding fixed payment amounts. But shifting the incentive structure away from fee-for-service merely swaps one perverse incentive for another: the incentive to minimize costs. Traditionally, doctors felt duty-bound to act solely for their patients’ welfare. The new breed of physician-employees will split their allegiances between their employers and their patients. The employers’ goals will not always coincide with the patients’ best interests, or the physicians’ best medical judgments. At minimum, patients will wonder if their doctors are making decisions out of a genuine concern for their health or just trying to save the boss a buck.
This criticism actually gets it exactly backwards. When hospitals acquire doctors and independent practices, the cost of care actually goes up. It really, really does. Big hospitals with few independent practices means a more expensive system, not one that prioritizes cost-efficiency over patient welfare. In a time at which medical debt may be rising, that is reason enough to worry.