The Affordable Care Act Will Have a Negative Impact on Physician Practices and Productivity

The Affordable Care Act (ACA) is a flawed attempt at health care reform that will make it harder for physicians to maintain independent private practices and incentivize doctors to become hospital and health system employees, leading to a decline in physician productivity and reduced access to care for millions of Americans.

We are currently in the midst of a profound transition from an entrepreneurial physician workforce to one that consists largely of doctor employees. While many physicians who make the transition to employment by hospitals and large medical groups benefit because they no longer have to deal with administrative and staff issues, they also frequently become less productive compared to their private practice counterparts.

While not all physicians employed by hospitals fall into the lower productivity trap, recent surveys have shown that is often the case. According to the Medical Group Management Association-American College of Medical Practice Executives (MGMA-ACMPE), “hospital-employed physicians work fewer hours and see fewer patients than do independent doctors.” An MGMA-ACMPE survey found that employed physicians work fewer hours per week than doctors in private practice and see 17% fewer patients (18 a day) than practice-owning doctors (22 a day). About 20% of employed doctors work fewer than 40 hours a week, compared with 18% of physicians with an ownership stake in their practice. Already, more than 60% of physicians younger than age 40 are employed by a hospital or other entity.

This transition from doctor-as-entrepreneur to doctor-as-employee will only accelerate as the ACA is fully implemented, which is bad news for patients because reduced physician productivity translates into reduced access to care.

Howard Axe, MD, president of the Chicago Medical Society, told the Chicago Sun Times that he is already seeing a “growing number of doctors who have sold their practices to hospitals or larger medical groups” in anticipation of the full implementation of the ACA. Axe believes “there are multiple measures in the Act that are anti-private practice. It pushes physicians into larger groups so they can give up the administrative burden” and “removes incentives for doctors to retain a heavy load of patients.”

Scott Gottlieb, MD, writing in the Wall Street Journal, concurs. He fears that, by incentivizing “the delivery of outpatient care through hospital-owned networks,” the ACA will directly lead to a reduction in physician productivity and also a loss of quality in care. He says industry estimates show that productivity falls by 25% or more for physicians who work for hospitals or hospital-owned groups, “a consequence of the more fragmented, less accountable care that results from these schemes.”

Gottlieb says that physician employees not only see fewer patients, they also have less incentive to “cover weekend calls, see patients in the ER, squeeze in an office visit, or take phone calls rather than turfing them to nurses.”

We should know better than this, having been through this once before. Gottlieb notes that consulting firm The Advisory Board Company has estimated that “when hospitals last went on a physician-acquisition binge in the late 1990s, productivity fell by as much as 35%.”

Despite the claims by Secretary of Health and Human Services Kathleen Sebelius and others that the ACA will dramatically expand access to care for millions of Americans, the truth is that the math doesn’t add up. By driving physicians in ever greater numbers to forgo private practice for hospital employment, while swelling the ranks of potential patients, the ACA will result in reduced physician productivity, reduced access to care for patients, and reduced incentive for physicians to go above and beyond, all in the name of health care “reform.” As this accelerates under the ACA the physician-patient relationship will also change — and not for the better, I fear — resulting in poorer long-term outcomes for many patients.

The professed goal of the ACA to provide better health care to more Americans cannot be realized due to the reduced availability of physician interaction. Perhaps, moving forward there will be enlightened modifications to the ACA that will encourage increases in physician productivity and access. Before this can occur, officials like Sebelius have to stop making empty promises and honestly address the flaws in the “reform” they have pushed on the country.