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Community-based physicians—those previously working in private groups—are increasingly selling their practices or seeking employment directly with healthcare systems. Some are doing so to gain stability in an uncertain business environment or reduce their administrative responsibilities; others, to gain improved access to healthcare IT tools, facilities or equipment; still others, to gain a more manageable workweek. Hospitals, for their part, are aggressively acquiring physicians to lock in physicians and secure patient volumes.
Accenture research shows that the percentage of “truly independent” physicians has been declining by 2 percent annually, and is projected to decline by 5 percent annually by 2013.
To stay competitive in this transformed landscape, health ecosystem stakeholders—medical device makers, healthcare IT developers, pharmaceutical companies—will see their target customers shift from individual, self-employed physicians or doctor-owned practices toward hospitals and health systems. Selling to these larger corporate purchasers will require new strategies for segmenting customers and for marketing and distributing offerings.
Accenture primary research, along with our review of a broad range of secondary research, suggests that the tightening of physician-hospital integration occurring today will continue. Because this change will present both new challenges and opportunities for healthcare ecosystem stakeholders, it is critical to analyze the potential implications of the trend for stakeholders and to develop potential courses of action for addressing the challenges and exploiting the opportunities.
Developing new strategies for segmenting customers and for marketing and distributing offerings to larger corporate purchasers will be challenging, given the complexities that have come with increasing physician-hospital integration.
These complexities take three forms:
Driver complexity. Different hospitals may have different degrees of urgency to hire physicians and secure the doctors’ or practices’ patients. This need may vary with supply of primary care doctors or specialists. And doctors may remain independent if deals proposed by hospitals do not suit them.
Geographic variation. Regions differ in terms of the number of autonomous physicians versus the number of large hospitals that employ many physicians. Companies may have to adjust their sales force structure (for example, national vs. regional) and offerings (product vs. solutions) to each market type.
Alignment-model proliferation. Physician-led alignment models (physician-hospital organizations, independent practice associations) are serving as alternatives to hospitals’ direct employment of doctors. These models could preserve physicians’ independence. Moreover, each has a different primary mission, contractual type and governance structure—making it even more challenging for stakeholders to reach and serve the physician market.
To surmount the challenges and seize the opportunities presented by tighter physician-hospital integration, stakeholders will need to address key points:
Healthcare IT, medical device and pharmaceutical companies will need to understand the implications of proliferation of hospital-owned medical groups for their customer segmentation, go-to-market and distribution strategies.
The payer sector will need to understand how to manage its client relationships and physician networks. As physicians increasingly associate with larger groups and health systems, payers will have to determine what integrated physician-hospital organizations’ greater negotiating leverage will mean for payers’ business strategies.
Hospitals will want to determine how to recruit and retain enough physicians with the right skills to capitalize on high-growth-potential service lines such as cardiovascular care, orthopedics, cancer care and radiology.
Physicians must ask what alignment model will best allow them to manage the trade-offs between autonomy and employment.
March 28, 2011
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