Health-care prices soar as doctors move away from private practice, join hospitals (News&Observer)

from the Raleigh News&Observer

“Doctors Join Hospitals, and Prices Soar,” Dec. 16, 2012,
by BY JOSEPH NEFF, AMES ALEXANDER, KAREN GARLOCH AND DAVID RAYNOR

In April, The News & Observer and The Charlotte Observer published a five-part investigation showing how nonprofit hospitals in N.C. cities have become hugely profitable. Here’s the latest article in the series.

North Carolina patients pay more for many tests and procedures if their physician is employed by a hospital, an investigation by The News & Observer and The Charlotte Observer has found.

It’s true whether the health care offered is a heart stress test or a routine visit to a doctor’s office. And it’s part of a national shift that experts say is raising costs but not quality: Hospitals are increasingly buying doctors’ practices, then sending bills for routine services that are significantly higher than those charged by independent doctors.

By one count, the percentage of doctors nationally who are employed by hospitals has doubled over the past decade. No similar statistics are available in North Carolina, but it’s clear that more and more doctors are affiliating with hospitals. …

“Prices are increasing, often for no other reason than the sign on the door changed,” said Robert Zirkelbach, spokesman for America’s Health Insurance Plans, a trade group representing the insurance industry.

Here’s why: Medicare and private insurers pay more for outpatient care – which includes an allowed facility fee for hospital infrastructure – than for the same procedure in a doctor’s office, which cannot charge a facility fee. A hospital can increase revenue by acquiring a practice and changing the billing to outpatient. Or the hospital can simply convert its doctors’ offices to hospital facilities. …

Read more here: http://www.newsobserver.com/2012/12/15/2547121/doctors-join-hospitals-and-prices.html#storylink=cpy

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