Page 14 - OctSam2019

CORPORATE
MEDICINE

The Corporate Practice of Medicine –

What is it?

Well, in part it started with

FRIED

CHICKEN

By Rodolfo Molina, MD
Master ACR Fellowship ACP

The year was 1968 and dr. Thomas Frist, Sr., a Nashville physi- The rising costs of healthcare have put into question how health-
cian, and Jack C. Massey, the man who made Kentucky Fried care is being delivered. Entering cost into the equation of how a
Chicken into a national chain, formed the Hospital Corporation of patient is treated has led to the emergence of a new ethos that de-
America (HCA). This was done by using the capital in Frist’s private fines value in healthcare as “a patient’s outcome divided by the cost
hospital, Park view, to acquire additional hospitals. HCA has since to achieve that outcome” (value = outcome/cost). If the cost of a
become the country’s largest investor-owned hospital chain in the patient’s illness is excessive in order to achieve a desired outcome,
United States. then the value of care to the payor is diminished, potentially delaying
At that time, few hospitals were for-profit. but by 1983, 13 per- or rationing of care for said patient. Philosophical values driving a
cent were controlled by for-profit investors. Medicare/Medicaid free market are woven into the financial platform of corporations
(CMS) made this possible when it was established in 1965. This fed- that are difficult to deny. Physicians are referred to as “providers”
erally-funded insurance system created opportunities for profit seek- and patients as “consumers”. If healthcare is to be considered a
ing corporations that were not previously possible, allowing them commodity we should ask:
to generate substantial wealth from healthcare. “Corporate Medi-
cine” now includes all types of investor-owned corporations that Are physicians the new proletariat?
seek to profit from healthcare; all are competing for a share of the The cost of doing business for private practitioners continues to
healthcare marketplace and are firmly rooted. rise and, if a physician is not part of a big entity that can absorb
The lack of a well-thought-out health delivery system has resulted these costs, then the strategy for staying solvent is challenging.
in insurance giants such as Humana and Aetna buying up physician Physicians must accept and understand how this system operates.
groups. Pharmacy benefit Managers (PbMs) have opened medical Insurers, their PbMs, pharmaceutical companies and all that can be
clinics in their pharmacies, supermarkets have created “retail med- considered corporate medicine are vying for the same dollar. They
ical clinics” in their stores, and free-standing medical clinics and sur- all have their guardrails to protect their profits. Yet, for small groups
gical centers (physician or hospital owned) are part of the vista that of physicians or solo practitioners who are battling the cost of
we call healthcare. Mergers and acquisitions of medical practices by EMRs, the costly bureaucratic time filling out prior authorizations,
for-profit businesses have transformed healthcare into a commodity combined with increasing overhead costs, are traveling the path of
of convenience rather than a humanitarian and scientific effort. extinction.

14 San Antonio Medicine • October 2019