Non-compete Agreements or Restrictive Covenants are contracts  that bar a physician from practicing in a specified geographic area for a set amount of time, i.e., working within 20 or 30 miles of their previous office for 1, 2 or 3 years after they leave.

Although they are restricted or illegal in some states, -Alabama, California, Colorado, Delaware, Massachusetts, North Dakota, Tennessee, and Texas- they are generally enforceable as long as the terms are reasonable. It’s the Hospital’s or employer’s insurance which bars doctors from leaving for a competing hospital or clinic and taking patients with them- assuring that the Hospital gets a return on their investment when they hire a doctor.*

When a  physician challenges a signed non-compete, courts often look for a reason to not enforce it.  Some common weaknesses that make the agreement ineffective are:

  • It’s too broad – if it spans more than a year or two or more than 30-50 mile radius of the practice or hospital,
  • The Hospital did’t hold up their end – if the employer promised the doctor a certain level of income or similar benefit and didn’t deliver.
  • Patients may suffer – If there is an inconvenience to patients – if patients will be required to travel a great distance to see a doctor.
  • Hospital fires unfairly – If the hospital determined the doctor to be of such little value that they terminated the doctor – then it is difficult for the hospital to enforce an agreement that presumes the doctor will be a competitive threat.
  • Hospital enforces selectively – if the hospital did not enforce the rule in the past to a doctor, the judge will possibly rule that it can not then apply this time.

New  Mexico  limits restrictive covenants for employed physicians but not for non-solicitation agreements-i.e., physicians who have been employed by an organization  for fewer than three years are allowed to leave and compete – but the organization can require the employee to repay incentives like loans, relocation expenses and signing bonuses.  After three years a doctor can leave with no strings attached.

The three main parts of most restrictive covenants are:

  • Agree not to compete with former employer.
  • Agree to not solicit patients, employees or both,
  • Agree to not use or disclose confidential information.


nc-2To prevent theft of a company’s trade secrets these contracts may be closely related to business torts or suits for money damages caused by unfair competitive practices or theft of trade secrets.  Many states have enacted laws modeled after the Uniform Trade Secrets Act to establish standards to protect trade secrets from theft and misappropriation.  These define “trade secrets” to include patient lists and contact information, pricing methods and other similar valuable, non-technical business information.  Even in the absence of a restrictive covenant, the law protects businesses from employees who seek to use their employers trade secrets for their own competitive advantage.  Restrictive covenants allows a business to define its confidential information and the activities it considers off limits.  Like trade secret law, restrictive covenants are regulated by state law, so interpretation and enforceability will vary from state to state.    ***

Again courts in many states will refuse to enforce a restrictive covenant that:

  •  does not protect the employee’s legitimate interest
  • imposes an undue hardship upon the employee
  • contains terms -duration, geographic scope and or breadth of restricted activities- that are broader than necessary to protect the employer’s interests
  • causes harm to the public.


However a restrictive covenant will be more likely to be enforced if its description of the employer’s protected business interest is similar to the definition of trade secrets in the home state’s trade secrets act.  Anything broader than that definition will be subject to possible rejection by the court.  Especially if the Agreement is to:

  • last too long
  • cover to wide a geographic scope
  • result in harm to an area of public interest.






*                *                *                 *                    *                  *                      *                    *

  •     Beaulieu-Volk, Debra,  Physician Noncompetes stir controversy amid shifts in employment trends, Fierce Practice Management, June 2, 2015.

**     Beaulieu-Volk, Debra, 5 Sign of an Unenforcable Noncompete, Fierce Practice Management, October 5, 2011

***Kirchner, Philip,, 2015/08/07

**** Caramenico, Alicia, Fierce Healthcare, Hospital’s nocompete agreement inconveniences  patients, judge rules, September 7, 2011.








Is Technology Replacing the Physical Exam as the Diagnosis Tool?

fat pt3Is Technology Replacing the Physical Exam as the Diagnosis Tool?

Older doctors are saying that doctors today are spending more time with their computers than at the bedside. Doctor-patient conversations are infrequent and brief. Technological tests are becoming the primary source of information on a patient and the basis for diagnosis.

Today the ability of a doctor to use a physical exam to make an accurate diagnosis is fast disappearing. Today a physician’s exam skills are considered obsolete and are being replaced by technological findings, which are considered to be more objective and accurate.

Insurance, that pays for the tests, accelerated the trend, plus the growing paperwork burden, that doctors have, and many of the generation of mentors who taught physical diagnosis have retired.  Today physicians migrate from the patient’s hospital bed to a conference room down the hall where test results –not the actual patient- are examined.

However there are still some physicians who firmly believe that the physical exam should remain and be the starting point for treatment of all patients.  They say information gleamed from inspecting blood vessels at the back of the eye, observing a patient’s walk, feeling the liver or checking fingernails can provide valuable clues to underlying diseases or incipient problems.  The doctors interviewed said for a surprising number of diseases, diagnosis is based on observation and examination, not a test – Parkinson’s disease, shingles, drug rashes and constructive pericarditis. They say heart murmurs in children – distinguishing “innocent” murmurs from serious ones is an essential, but necessary skill for physicians and can best be done with the physical exam.

Medical Clipart
Medical Clipart

These skills, they say, are an essential adjunct to technology and can boost diagnostic accuracy, curb unnecessary and expensive testing and foster a greater connection between patients and doctors. With the physical exam, practitioners can assess enlarged lymph nodes, measure ankle reflexes and perform a knee exam.

With the physical exam the doctor can often find the “obvious” before putting the patient through grueling and expensive tests.  Studies have shown that the physical exam can be as accurate or more so, then the technological counterpart.

One physician said the first thing he always does is the fundamental clinical skill – he listens to the heart – because there is information to be learned. These physicians are saying, reviving the bedside medicine and ordering tests, based on the results of a careful physical exam and history will improve the quality of care for the patient and reduce costs.*



  • Boodman, Sandra, Emphasis OnTech Has Eroded The Old-Fashioned Physical Exam Diagnosis, Kaiser Health News, Physician News – Spring 2014,




H.R. 2513 – Promoting Access, Competition, and Equity Act of 2015

HR 2513-1

H.R. 2513

Promoting Access, Competition and Equity Act of 2015 (H.R. 2513), the PACE Act of 2015.

Some are For and some Against.


In 2010, the Patient Protection and Affordable Care Act, (ACA) banned building new or expanding existing physician-owned hospitals. Large General Hospitals and Medical Centers cited that private hospitals were “cherry picking” the healthiest and wealthiest patients, excessive utilization of care and patient safety concerns.

The law when enacted recognized that more than 200 physician owned hospitals were already operating and rather than force them to close, these hospitals were grandfathered in. The law did recognize that these hospitals were operating counter to the spirit of the new law and it thus prevented the opening of any new or expansion of any existing physician owned hospital unless the facility could show need in the community for greater access to care.

Forty plus major building and expansion projects underway at Physician Owned Hospitals, at the time,  were immediately stopped and any physician owned hospital that violated the ban was prohibited from participating in Medicare or Medicaid.

The current law, it is said, is to prevent harm to community hospitals, patients, taxpayers and employers that may be possible when physicians self-refer to hospitals in which they have an ownership interest. Changing the law now would allow broad repercussions for patients, taxpayers and the sustainability of full service community hospitals that provide services 24/7, including trauma care and other high-cost services that are critical to all communities and patients. They say changing the law will weaken full service community hospitals, increase patient safety concerns and increase the excess growth in health care costs that self-referral manifests. *

hr 2513-3

On the other hand, private physician-owned hospitals say they do not “cherry-pick” the most profitable patients.  A recent study found that patients at physician-owned hospitals and non-physician owned hospitals were equally likely to have Medicaid insurance and to be from racial or ethnic minority groups. Other studies have found that seven of the top 10 hospitals receiving quality bonuses in the new Hospital Value-based Purchasing Program in 2015 were physician-owned hospitals. This despite the fact that physician owned hospitals represent only 5% of the 5,700 hospitals nationwide.  Also the Centers for Medicare and Medicaid Services released Star Ratings in 2015 based on consumer assessment surveys and it was found that 40% of physician-owned hospitals received the top 5-star rating compared to only 5% of general hospitals.  In addition the Department of Health and Human Services found that patients are three to five times more likely to experience complications at general hospitals than at physician-owned specialty hospitals.  Further the study showed that physician-owned hospitals performed equally to non-physician-owned hospitals on many measures of quality of care, costs and payments for care. Often these hospitals charge less for the same procedures as the non-physician hospitals.  One example said that physician-owned hospitals are saving Medicare $3.2 billion dollars over 10 years.

Physician-owned hospitals also provide more charity care than their counterparts which receive  subsidies and tax exemptions.  One report states that physician-owned hospitals spend nearly 6% of their total revenue on community benefits compared to less than 1% for other hospitals.  Physician-owned hospitals are in both rural and urban areas including full-service hospitals and specialty hospitals focusing on orthopedic  surgery, cardiac care, rehabilitation, psychiatry, etc.  They explain that these are not hospitals where the physician owners expect to get rich. A majority of the physician owners have less than a 2% interest in the hospital.  These physicians, they explain, just want to practice in an environment where their medical expertise counts for something and they can put patient care first.

Physician-owned hospitals want Congress to allow their hospitals to be able to expand and grow in programs and services to the community. Since growth is currently prohibited, they say this poses a serious risk to their patients who look to them for high quality health care in a safe and personalized setting.

Physician-owned hospitals say that the big community hospitals see them as competition.  The big hospitals often are a major employer and thus they have more clout with local, state and federal politicians . **

Currently there are approximately 250 hospitals operating in 34 states, where physicians have an ownership stake.

The new legislation (H.R. 2513) –Promoting Access, Competition, and Equity Act of 2015, will suspend the moratorium on physician –owned hospital expansion for three years so that current physician-owned hospitals can expand their facilities and allow those facilities that were under development at the time the law was passed to be grandfathered in.

It may be of interest to read more about the bill and to contact your Congress person for more insight.





  • “Oppose Legislation (H.R. 2513) that would Allow for the Proliferation of Self-referral to Physician Owned Hospitals”, Federation of American Hospitals.

** Turner, Grace-Marie, “Lift the Ban on Physician-Owned Hospitals”,, Nov 6, 2015.










Anti-Kickback Statue


antiKB6When signing a new employment contract, fee agreement or other financial arrangement for services, review it carefully to ensure that you will be reimbursed or paid for services that you actually perform and that the pay reflects the fair market value for the work done.  One can be found to violate the AKS (Anti-Kickback Statue). A recent case in the Midwest found 4 hospital executives and 4 physicians guilty of offering and receiving illegal bribes and kickbacks to induce patient referrals to the hospital and to increase the patient census, which then will increase hospital revenue. These persons received prison sentences of several months.   Another example described compensation arrangements where physicians received additional compensation for advance job titles, such as “Director” when the title was not appropriate or compensation arrangements where a physician’s compensation included payment of the salaries for his office staff.


The Federal anti-kickback statue prohibits individuals and entities from knowingly and willfully offering, paying, soliciting or receiving remuneration to induce or reward referrals or business, reimbursable under any Federal health care program (FHCP). The types of remuneration covered include kickbacks, bribes and rebates, whether made directly or indirectly, overtly or covertly, in cash or in kind. The statue covers not only referrals of patients, but also the purchasing, leasing, or ordering of, or arranging for or recommending the purchasing, leasing, or ordering of, anything paid for by any FHCP.  There are, exceptions known as “safe harbors”.  Hospitals, suppliers and others may seek to comply with a safe harbor to ensure that their payment or business practice does not violate the statue.*


A Hospital or Health Care facility may furnish software or information technology to a physician practice. This may imply a kickback as it is potential remuneration for the Hospital.  This can be significant especially with electronic health records (EHR) – involving interoperable EHR software, information technology and training services. If the goal is to promote technology that will benefit patient care then safe harbor can protect these arrangements. There are conditions that exist in the use of safe harbor.  It is best to consult with legal counsel.

Physicians should take care that all compensation agreements reflect fair market value for services they actually provide. Also be certain that services included are not covered in other agreements. Keeping records of tasks done and time involved may be a good method to provide evidence should it be needed.





  • Office of Inspector General, U.S. Health & Human Services, OIG Alert, October 6, 2015.



How To Keep Your Practice Afloat.



Dr-1Managing a private practice or any private business today is challenging and balancing revenue and expenses can become a struggle to stay afloat.  Physicians say that payer reimbursements are barely keeping pace with practice expenses. Today’s medical practices contend with many new demands including high-deductible health plans, the new ICD- 10 coding system and new federal quality-care mandates.

The one answer to financial business problems is accurate and timely financial reports and then proper action on those reports. You must know where every cent comes from and where every cent goes and you must end-up with a positive final balance.acct tape-2

If expenses exceed income, you must decrease expenses or increase income and make these columns balance or income exceed expenses. If not, you will not remain in business. No matter how valid the expense is or how important you think the expense is, if you can’t afford it – you can’t afford it!  You have to do without or find a way to increase income to cover the cost.

Fountain Pen and Sign --- Image by © Royalty-Free/Corbis



And you must do the review YOURSELF!  You must see the numbers.  You do not turn this over to an office manager or an accountant to write up reports that you never look at. Such assignments are to note all transactions and to categorize and organize the information.  It is your job to review and know the numbers and make decisions accordingly.

Depending on the size of your organization, you must have regular (bi-weekly or monthly meetings) to go over the numbers related to the areas of responsibility of staff members. For the front office staff- are patients complaining or are fewer patients coming in?  For the purchasing person – are products costing more? Ask and know what is going on.  Are new patient visits growing or declining, is the practice doing more or fewer procedures than last year, are established patients remaining stable? Are referrals increasing or decreasing? Ask staff – they will have opinions – they are the front line.

Do not say that your responsibility is the medical care of the patient and the financial area is not yours. And do not say you are trained for the medical expertise and that you do not like business and thus you let someone else do the business. Do not say that you delegate the financial work. If you are in private practice, financial is part of your work. If you do not like the business, then get an “employed” position.

You are not too busy! It is part of the job of a private business.  If you want the advantages of a private practice, then you must assume all the responsibilities of the job.  Finances and the bottom line cannot be delegated.


So look at those numbers.  Know those numbers.  Have regularly scheduled meetings to discuss financial with staff.  Then act and correct the problem. Do not wait, problems usually do not go away and a smaller problem may be easier to correct. Some decisions will be difficult. Having to reduce staff or services – but if it must be done, do it and go on. And what’s more – you may actually like your new “financially growing” business!























Do Doctors Show Less Concern and Empathy for Obese Patients?


fat pt5Fat pt9

An audio-taped encounter between 39 primary care doctors and 208 of their patients revealed a major difference in the amount of sympathy physicians provide for overweight and obese patients compared to normal weight patients.  It was found that physicians expressed concern, reassurance and legitimation of patients feelings far less often with heavier patients. Doctors were 35% less likely to have an emotional  rapport with their overweight patients and 31% less likely to connect with obese patients. *

The AMA (The American Medical Association) now defines obesity as a disease making it a condition requiring treatment covered by insurance.  Thus doctors are obligated to diagnose and treat obesity.

fat pt1


Some doctors subconsciously see an overweight patient and immediately judge them as over-eaters – eating too much and eating sweets and soda all day long or lazy – couch potatoes, etc. This is reinforced by our societal image that everyone should be extremely thin.  As we all know there is much more to a patient’s weight.

Some physicians fear, and rightfully so, negative attitudes and resentment from patients when reminded of their weight.  Physicians receive little or no training on how to help patients lose weight and therefore feel inadequate and unqualified to consul patients.

However, ability to consul patients is one thing but ability to listen and to empathize is another.  Support your patients and be an advocate as they try to improve their health.

Be mindful of negative attitudes and make an effort to bond with overweight patients – discussing psycho-social and lifestyle issues.

fat pt4Fat pt8




fat pt 6 - Copy




*Beaulieu, Debra, Fierce Practice Management, Study: Docs show less concern, empathy for obese patients, April 24, 2013.






Physician Practices Bought by Hospitals Increases Costs

drs office-3

Dr. office-HosIn contrast to the hope and expectation that organizational consolidation of physicians with hospitals would result in greater coordination and thus lower expenditures, this is not being realized.

A study in California found that hospital ownership of physician groups led to a 10-20 percent increase in costs.  Researchers have found that the average expenditure per patient across all physician organizations increased by 16.5 percent between 2009 and 2012, from $2,954 to $3,443.  By 2012, expenditures per patient had increased to an average of $3,066 in physician-owned organizations, $4,312 in local hospital-owned organizations and $4,776 in multihospital system-owned organizations.

After adjusting for patient severity and other factors over the period, local hospital-owned physician  organizations incurred expenditures per patient 10.3 percent higher than did physician-owned  organizations.  Organizations owned by multihospital systems incurred expenditures 19.8 percent higher than physician-owned organizations.  The largest physician organizations incurred expenditures per patient 9.2 percent higher than the smallest organizations.*

It is also reported that Americans are paying higher prices for cancer treatments because more patients are being treated by oncologists whose practices have been bought by hospitals which may charge double or more for the same treatment.  Hospitals say the higher charges are necessary to support the overhead and administrative costs.  These higher costs often mean increased out-of-pocket costs for insured patients. Patients who have higher-out-of-pocket costs are more likely to drop out of treatment or skip treatments.**

Perhaps there are other benefits of Hospital-Owned Physician Practices, but evidently reduction in costs is not one of the benefits.


Dr. office





  • MacDonald, Ilene, Hospital Ownership of Doc Groups Leads to Higher Costs, FierceHealthCare, October 22, 2014.

**  Robin, Caryn, Chemo Costs in U.S. Driven By Shift To Hospital Outpatient Facilities, Physician News, Spring 2014.


Patient’s Opinions – Do You Know What They Are?

man w leg in cast

How aware are you to your patient’s feelings – their opinion of your practice, your office, office staff and your own expertise?Senior woman w glasses

This is an old topic –Medical School 101- but may need to be thought about again.

A couple weeks ago my friend was mentioning, that she is very upset with her doctor and will not go back.  She was discussing her medical problem and after examination and discussing lab results and possible treatments, etc., and the Visit was over the doctor picked up his things and as he was opening the door, he looked back and said, “maybe it’s cancer” and walked out.

She was stunned. What do you mean? Are you serious?  Was he trying to say a joke? The doctor was gone.  She couldn’t ask him to explain. What did he mean.  She says she is not going back .

I also am concerned.  I need to see a Podiatrist.  However the last time I was there, I felt I was  terribly treated, I do not want to go back.  I am not one to get upset easily, but I was very disgusted. The incident was my first time visiting this doctor and Office staff.  I walked in and went to the first counter at the office where staff were working. I stood there for a while, waiting my turn.  After a time, I moved over to the other window and kind of injected myself into the line and stated that I had an appointment and asked where do I sign in. I don’t remember the details, but basically was scolded for not knowing that I did not need to sign in and implied that I was wasting the lady’s time for not knowing and was told to take a seat and I waited.  Eventually I was called and went into an examination room.  Finally the physician came in with a Medical Student following.  He mentioned his name and looked at my foot.

He examined the foot and not talking to me, but to the medical student, he explained what he was seeing. No mention to me as to what he thought was a recommended treatment. He left the room and returned with two toe braces, one he gave me and the other I had to purchase for $10.00. He then suggested that I make another appointment in a couple months.  So I put my shoe on and went to the office counter and paid for the Visit and for the toe brace.  The lady at the counter was anything but friendly and her tone of voice and mannerism indicated that I was a nuisance.  I told them I would call back in to schedule, which I never did.  Should I go back and be treated so indifferently or find another doctor?  I think I will look for another doctor.

Do you know, or care, how you and your staff are relating to patients in the office?  Even though you are busy and are doing more important things such as teaching a medical student, do you really know how you are being perceived by a patient?  Are you so smug that you don’t care?

Could patients decide not to return?

Could you reduce your patient volume and income?

Perhaps you need to monitor patient satisfaction – a questionnaire to fill in when leaving, review online comments and “ask” – just plain ask the patient their opinion at the end of the Visit.

No matter how busy one is, no matter what problems you are having, no matter how discouraged you are about something, You have a job to do.  And the job should be done correctly.  You are to treat the patient and to do that you must first talk with the patient and learn what the patient is thinking. Then you must communicate to the patient what you are doing, what you are learning in the examination, what lab results indicated, etc., and then explain very carefully what you think is the diagnosis and what you believe is the best treatment.  And ask the patient if they understand and if they have any questions?  At least that’s what I think and so does my friend.

Discover how the staff is interacting with patients.  Are they friendly and helpful or is the staff angry about a new policy, etc., or is the staff having a feud among each other and this is spilling over into patient hospitality. Take a couple seconds, during the day, and watch and listen.

If patients do not return, maybe there is a reason.




For additional discussion, see:

Patient Satisfaction,, April 30, 2015

Doctor Ratings and OnLine July 31, 2014

Are You Listening to Your Patients?, June 30, 2013












Doctor Lawsuits

Dr laws-1

Some thoughts about medical lawsuits and a review of some of the articles.

When patients are upset, the article says, the best way you can prevent their dissatisfaction from escalating into a lawsuit is to communicate with empathy. In short, patients are more likely to turn to lawyers when they are unable to obtain answers from the practice.  The concept holds true whether the problem is a medical or service-related issue. Therefore keep the following advice in mind should a bad outcome or conflict arise:

  • In the case of a medically adverse event, “simply say you are sorry it happened and promise to undertake a review. That’s all you need to say.  Regardless of how an apology law might come into play, this measure keeps patients from feeling abandoned and shut out.
  • When patients are angry about a perceived service flaw, let them vent, but take them into a private room to do so. Acknowledge the problem and empathize with the patient.  Explain why a particular demand cannot be met and negotiate a compromise. If anger is escalating or the individual refuses to leave, activate your emergency procedures, which may include contacting security or the police.
  • While an investigation into a problem is underway, stay in contact, even if you have nothing new to report.*


Diagnostic errors, not surgical misadventures, obstetrical mistakes, or improperly delivered medications, are the main source of successful malpractice claims. Incorrect, missed or delayed diagnoses accounted for 29 percent of successful malpractice claims.  They accounted for 35 percent of the total amount of money paid out and caused 39 percent of malpractice-related  deaths. Diagnostic errors are the most common, the most costly and the most deadly of all medical errors.  One estimate is 40,000 – 80,000 Americans die from missed diagnoses each year. **


Malpractice defense is expensive even if you win. Even if you win, providers involved in lawsuits can still have large expenses to pay.  If malpractice claims result in an indemnity payment, the defense costs may be $20,000 – $100,000.


Some recommend that you should always settle a malpractice case. As your thoughts may be to fight, they say years of litigation may not be the best decision for the following three reasons.***

  • Your insurer is in charge. They say that unless your malpractice policy includes a “consent to settle” clause, the insurance company makes the final decision of whether to settle or go to court. And even if the policy leaves the decision with you, it likely includes a “hammer clause” which may leave you liable to pay the difference between the jury reward and settlement amount should you lose.
  • The emotional toll of defending is too high. The average claim that goes to trial is a 3-5 year process. Emotionally it’s consuming. The allegations made are intensely personal. In high-dollar cases, some of that is played out in the press. Winning is better than losing, but it can be a painful victory.
  • The current legal climate works against you. Recent decisions by your state Supreme Court on issues pertaining to your case can strongly predict your outcome and potential success on appeal. Just as lawyers hate to lose cases, trial judges hate to get reversed. So trial judges read the reports from the State Supreme Court and they know which way the wind is blowing and they don’t want to be the first with a contrary ruling. If they think the supreme court judges in your state are looking at a particular fact pattern or problem in a certain way, then because they do not want to get reversed, they will tend to look at in much the same way.


It’s not a given that injured patients or their family members will sue after a bad outcome. Key reasons given in an article on the subject follow.****

  1. They have respect for the doctor. Many patients are reluctant to sue and are willing to forgive caregivers if they feel they’ve been respected.  If the doctor has shown respect for the patient, being candid and answering questions and spending time explaining what to expect during recovery, patients are less likely to ‘want to get even’.  The doctor doesn’t have to be warm and fuzzy, but truthfully explain the situation.
  2. Often the potential reward is too small. Patients may want to sue because they need the money to pay for financial losses caused by the injury. However they may not be able to find a lawyer willing to take the case, if the recovery isn’t large enough.  ‘The average case costs at least $50,000 and often more for the attorney to put together; so the recovery must be at least  6 figures for the lawyer to afford to take the case.






*  Beaulieu-Volk, Fierce Practice Management, 3 Communication Strategies to prevent lawsuits, February 23, 2015.

** Brown, David, UPDATES, Diagnostic Errors are Leading Cause of Successful Malpractice Claims, April 22 2013.

*** Beaulieu-Volk, Debra, Fierce Practice Management, 3 Reasons You Should settle a Malpractice Case, October 1, 2013.

**** Beaulieu-Volk, Debra, Fierce Practice Management, 3 Reasons Patients Won’t Sue Doctors, November 26, 2013.






Ins -4Ins-3

During recent House Judiciary Committee hearings on consolidation in the healthcare industry, Aetna CEO and Anthem CEO made many of the same points they made recently in a Senate hearing, supporting their mergers with Humana and Cigna. Aetna’s CEO said that their acquisition of Humana is bringing two companies together to offer a large number of consumers a broader and higher-quality array of more affordable products. After the acquisition, Aetna will have a product portfolio balanced more evenly between commercial and government products such as Medicare and Medicaid. Aetna’s CEO further stated that there will be no effect on revenue for doctors as a result of the acquisition and in addition Aetna is committed to working with providers to transition to value-based payment models.

Anthem said that with Cigna, their combined analytic capabilities will enable better informed decision-making between patients and physicians and help safeguard access to new clinical discoveries.

Both the president-elect of the American Medical Association, Andrew Gurman, M.D., and the executive vice-president of the American Hospital Association, Tom Nichols, voiced  opposition to the mergers. Nickels said that the AHA is very skeptical that the insurance companies are simply seeking to acquire companies that have complementary business lines and that there would be no overlaps leading to more market consolidations. He also questioned the insurers claims that that all healthcare is local, saying that the insurers have been citing national statistics on the number of competitors rather than the number of local competitors.  Further he questioned the insurers example of Oscar Health to prove that new competitors can enter the insurance market. He stated that Oscar Health is only one of two for-profit companies to enter state markets, that were not already insurers, and reported that thus far Oscar has only got into one urban market and that it had significant losses this past year.

Gurbman pointed out that consolidation in the health insurance industry compromises the ability of physicians to advocate for their patients, especially when doctors are forced to negotiate with a “mega-merged conglomerate”.  He said excess market power allows insurers to exert control over clinical decisions, which ultimately undermines the doctor-patient relationship and eliminates crucial safeguards of patient care. He points out that what is ultimately important is the health and safety of American patients.  He further pointed out that coordinated care does not require massive consolidation among healthcare insurers.

And the saga will continue.  The results will have definite effects for providers and patients.

Ins -1









  • Small, Leslie, Fierce Health Payer, In Latest Hearing, Provider Groups come out Swinging Against Insurer Mergers, September 30, 2015.






Considerations on Healthcare Delivery