Academic journal article Frontiers of Health Services Management

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Academic journal article Frontiers of Health Services Management

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Article excerpt

The physician is the heart of healthcare, and physician organization is the heart of the healthcare system. The rise of physician practice management firms, which are introducing dramatic changes in the organization and financing of physician services, is a phenomenon of the first importance for everyone in the field. It is impossible not to have strong feelings about medicine's gale of creative destruction. The three respondents are no exception.

Stephen Ummel highlights the imperative for hospital systems and integrated delivery systems to improve their performance in the light of this organizational challenge, most importantly in bringing physicians to a more central role in decision making. In an evenhanded fashion, he recognizes the challenges facing the PPMCs in managing the process of organizational growth and responding to the demands by purchasers and health plans for enhanced efficiency and quality. We echo these comments, and note that the great virtue of new market entry is its effects on the incumbent firms, who can no longer take their clients and customers for granted.

Dr. Derick Pasternak is more of a skeptic, questioning whether the new physician entities can match the track record of the leading multispecialty medical groups such as Permanente, Lovelace, Mayo, and Palo Alto. These clinics do indeed have an impressive record, but the sad fact has been the reluctance of most American physicians to create or join medical groups that offer the efficiencies and quality enhancements of these pioneers. A number of prominent multispecialty groups have encountered difficulties in adjusting to the new environment of constrained financing and managed care, moreover, and have sold to hospital systems or insurance plans. …

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