When hospitals acquire practices, some patients pay more

As hospitals acquire more physician offices, patients are often paying more, not less, for their care. At the heart of the disparity is Medicare’s policy of paying one price to independent physicians and another to physicians who work for large health systems—even if they are performing the same service in the same place.

Last week, the Obama administration recommended a change to eliminate much of that gap. The proposal would yield savings for Medicare and patients by reducing the financial incentives that are causing many physicians to sell their practices to hospitals just to take advantage of extra revenue.

The administration’s proposal would essentially end the system of different prices for similar services: Medicare would pay the same for any visit, test, or procedure offered by physicians who work in private practice and by those who work in off-campus practices that are owned by hospitals. Physicians who work in the hospital could still be paid the higher hospital rate, but the free-standing practice that suddenly changes hands would not continue to be paid more.

Source: New York Times