Trends Unfolding in Physician-Hospital Alignment

PwC released the second report of its two part series on physician-hospital relationships yesterday, titled From Courtship To Marriage Part II: How Physicians and Hospitals Are Creating Sustainable Relationships. The first survey identified factors motivating physician-hospital alignment, while the second discusses how both parties may reach alignment and issues they may face in the process of getting there.

In general, the report revealed physicians' overwhelmingly eager attitudes toward leadership roles within hospitals — a finding that has taken many healthcare experts by surprise. Ross Stromberg, a director in PwC's Health Care Advisory, expanded on some of the surveys findings, noting the mindset physicians have adopted and the question hospital administrators should stop asking.

Time is running out for hospital administrators' wariness
In the study, more than 90 percent of physicians said they should be involved in governance activities — a finding that took Mr. Stromberg by surprise. "They not only want to be involved in clinical or operational leadership, but in the management of the facility itself," says Mr. Stromberg.

Another important survey finding to note, however, is hospital administrators' wariness of physician leadership. "Many of them wonder if physicians are really ready for this; if they have the training and experience in the business aspect of a hospital. In my view, that question is somewhat moot. That's a question from the last century," says Mr. Stromberg.

Rather than doubting physicians' ability to lead, hospitals need to think pro-actively and lend physicians tools to build their skills.  Many hospitals are relying on on-the-job training from external associations, such as the American College of Physician Executives, for educational and leadership development programs.

Physicians will make time for leadership if proper incentives are in place
One of the more surprising findings was the number of physicians — close to two-thirds — who say they have ample time to serve in leadership roles, such as performance improvement initiatives, hospital executive leadership or on the board of directors/trustees. "I do have a little bit of doubt about the time," says Mr. Stromberg. "I've served on boards for a number of years, and it can be difficult to schedule meetings with physicians' schedules. You end up meeting at odd hours," he says.

Of course, physicians want to be paid for leadership responsibilities as well. "If they're taking off clinical time, they justifiably want to be paid for their administrative time," says Mr. Stromberg. Franciscan St. Francis Health, based in Indianapolis, compensates physicians who participate on committees and in leadership roles, for instance. Physician compensation models include a citizenship score, which is based on credits received from participating hospitals and medical group committees, providing an incentive for physicians to participate.

More than half of physicians are satisfied with non-monetary perks of hospital employment
Related to compensation, 17 percent of physicians said they would take a decrease in compensation in exchange for hospital employment, reflecting appreciation for the job security a hospital represents in today's industry. "There are a lot of pressures on physician practices, leaving many physicians looking for stable income and a sustainable platform — not a burning platform," says Mr. Stromberg. Some physicians have adopted the mindset that even if their pay is less with a hospital, it is still an income — a philosophy that may sound bleak but mirrors a healthcare landscape where independent physician practices face significant challenges.  

Read the PwC survey here.

Read more about hospital-physician relationships:

- Survey: 45% of Physicians Expect Higher Salaries With Hospital Employment

- Developing an ACO: How to Manage Risk

- Q&A With Authors of "Accountable Care Organizations: Your Guide to Strategy, Design, and Implementation"