Sound Off: Alan Hilibrand on Hospitals Partnering with Physicians to Run Hospitals

by Elizabeth Hofheinz, M.P.H., M.Ed., October 29, 2019

When it comes to partnering with physicians to manage hospitals, some hospitals “get it” and some don’t, says Alan Hilibrand, M.D. the Joseph and Marie Field Professor of Spinal Surgery and Professor of Orthopaedic and Neurological Surgery at the Rothman Orthopaedic Institute and the Sidney Kimmel Medical College of Thomas Jefferson University.

Dr. Hilibrand states, “There is a real chance that we are close to a lifting of the moratorium on physician-owned hospitals that was instituted as part of the Affordable Care Act (ACA).”

But, wonders Dr. Hilibrand, will traditional hospitals be ready?

“It remains unclear whether hospitals can ‘get their heads around’ the concept that partnering with physicians in the management of hospitals—either by setting up a specialty hospital or partnering with doctors to manage the orthopaedic service line of traditional hospitals—can be beneficial for them. Thomas Jefferson University was initially hesitant when Rothman purchased its hospital—just before the ACA. They took a small share of the pie, so for the hospital it was a successful move, while it provided us with a ‘release valve’ for the growth in surgical volume”

And the benefits don’t just extend to facilities and surgeons, notes Dr. Hilibrand. “Physician-owned hospitals provide special pathways to get patients out of the hospital one day earlier. For example, getting patients to their rooms within an hour or two of surgery and having the physical therapists work with the patients several times on the day of surgery speeds patients’ recovery.”

“People are always saying that we need to increase efficiency in the healthcare system. By ‘Demand-matching’ we can treat healthier patients at lower-cost facilities, and save the tertiary facilities for sicker, more complicated cases. If both hospitals are in the same health system then physicians and their hospital partners can work together to demand-match patients seeking care in their health system” 

“If the moratorium is lifted on physician-owned hospitals there will be a new and exciting opportunity for doctors to pursue arrangements to partner with large hospitals who can absorb the cost of building these facilities, which will be more economical for them. And one of the benefits to physicians is that when you are with a larger healthcare system you are in a better bargaining position for reimbursement from insurance companies.”

And don’t those in power want to give it up?

Dr. Hilibrand: “Some hospital leaders want total control, are accustomed to a top down management style, and thus are not open to sharing ownership with outside entities. These are not people who will readily listen to a board of directors that is primarily comprised of doctors making suggestions about how to manage ‘their’ hospital.”

“There are a number of forward-thinking physicians who comprehend healthcare economics—some of whom have MBAs—and they understand what things are driving the system, where it’s going, and how best to attain high quality care at reasonable prices.”