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Hospital-Physician Alignment Print E-mail
Written by Todd Demel, MBA   
Monday, 20 June 2011 00:00


During a time when we are seeing a cyclical change towards hospital employment of physicians, there has been an increased focus on strategies for achieving successful physician/ hospital alignment. Although similar such efforts failed in the early 1990s, hospitals today are adopting a different approach to employing practices. While the primary difference has to do with the structure of physician compensation, there are best practices that can be employed to increase the likelihood of successful relationships.


The trend toward hospital employment has come about for a number of reasons. Among these, it has become increasingly challenging for physician practices to go it alone. Most physicians expect at least some sort of increase in compensation when teaming-up with a hospital. In addition, malpractice liability insurance along with certain administrative functions is often assumed by the hospital, thus giving physicians an added sense of security.  In an increasingly competitive environment, hospitals may employ physicians to gain market share, to support Emergency Department call, or increase referrals to their facility. The hospital may also seek out particular specialists in order to assure strength in strategically important clinical services.  


With new pressures being exerted on providers, such as quality/outcomes reporting, reductions in professional and technical fee reimbursement, and increased regulatory requirements, the need for clinical integration has become more pronounced. A recent development that both supports and encourages integration is the collaborative effort between hospitals and physician practices in establishing an electronic medical record (EMR).


Previous federal policy that enacted a 'Safe Harbor' related to Stark Regulations has allowed hospitals to donate EMR hardware, software, training and support services to physicians. While practices must contribute 15 percent toward the donor's cost of the items and services provided, this still represents a significant savings for physicians. Due to impending deadlines beginning in 2011 on financial incentives associated with the Health Information Technology for Economic and Clinical Health Act (HITECH Act), there has been increased focus on the establishment and use of EMR systems. This type of shared technology goes right to the foundation on which hospital-physician integration should be based: the care of patients and patient information. And the sharing of patient clinical data provides the opportunity for providers to improve the quality and effectiveness of care delivery as well as achieve the long-range goal of cost reduction.       


With discussions regarding Accountable Care Organizations (ACOs) front and center, it is also important for hospital-owned practices to maintain a culture of accountability. This translates into physicians being involved in the strategic decision-making of the practice, and the new entity retaining the ethos of the private practice in spite of the changes in management and standardization of certain processes. Allowing physicians to retain some control, involving them in governance and operations, and providing incentives can contribute to the success and longevity of the newly-formed relationship.

By empowering the physicians, they become accountable for the success of the practice rather than relying on or blaming the hospital for their successes or failures. Promoting participation of physicians on boards, governing councils, and oversight committees, for example, is also likely to reduce physician turnover. This type of collaborative effort fosters a team approach wherein the hospital/ physician partnership becomes aligned.  

ABOUT THE AUTHOR:  Mr. Demel is Senior Executive of Physician Management Services at MF Healthcare Solutions.  Possessing both operational and financial backgrounds, the MF Healthcare Solutions management team has vast experience in a range of healthcare industry settings. Our combined expertise enables us to offer specialized and effective physician practice management services. For more information, please visit: or contact Todd Demel at (954) 475-3199.

Last Updated on Wednesday, 29 June 2011 16:36
Tail Coverage for Physicians Acquired by Hospitals Print E-mail
Written by Matt Gracey   
Tuesday, 14 June 2011 18:27

Med Mal Q & A 

Q: When a new doctor or a group of doctors is considering selling out to a hospital, will the hospital force the practice to purchase an expensive "tail" for its malpractice insurance policy or will the doctors be allowed to keep their retroactive coverage?

A: Doctors looking to become hospital employees undoubtedly have very different perspectives on this issue than hospitals. The hospitals prefer not to purchase retroactive coverage for the doctors they are integrating for a number of reasons. The first is the decreased expense of a first-year claims-made policy versus a more expensive policy that includes mature retroactive coverage. The second reason is that hospitals do not want the doctors' previous practice risk exposure to potentially harm the claims record of the hospital should a purchased doctor have a claim resulting from their previous practice. Third, if the hospital does allow doctors to join with their previous practice's retroactive coverage intact, then it could become a Stark issue if the whole package is considered over that undefined edge.  Additionally, some hospital insurers or their captives' reinsurers have started to strongly suggest, and in some cases require, that hospitals force doctors to purchase "tails" before a purchase is finalized. Finally, hospitals need to be very concerned about the differing "triggers" in malpractice insurance policies, as serious and expensive gaps in coverage can be created on this front. 

The only reason a hospital would ever want to purchase retroactive coverage for a new doctor is to make its recruitment efforts easier since doctors often balk at the high cost of malpractice insurance tails, but hospitals will inevitably learn that cheap can become expensive quickly on this coverage.
In short, many hospitals are taking the position that they do not want to insure what they cannot control, such as doctors' past malpractice exposure, so they are forcing doctors to purchase "tails" before practicing for the hospital

ABOUT THE AUTHOR:  Matt Gracey, Jr. is a medical malpractice insurance specialist agent with Danna-Gracey in downtown Delray Beach. 
To contact him call (561) 276-3553 or (800) 966-2120, or email:   

Last Updated on Tuesday, 14 June 2011 18:31
Written by Jeffrey Cohen, Esq.   
Thursday, 05 May 2011 09:05


Though it is customary for many medical practices to pay its physicians as 1099 independent contractors (instead of W-2 employees), doing so can be very expensive because the IRS is expected to increase its investigations and enforcement actions in this area.

Small to mid-sized employers (especially in the areas of hospital based specialties) have traditionally had a very relaxed attitude about how their staff is paid. They figure "What's the big deal? What difference does it make if I pay someone as an independent contractor versus withholding taxes and paying them as a W-2 employee?" The answer: Plenty! Why? Because if the IRS determines a person is wrongfully characterized by the employer as an independent contractor, the employer would be responsible for all the employer related taxes plus penalties.  

Determining whether or not a person would be viewed as a W-2 employee instead of an independent contractor is not a simple thing. The "20 Point Test" typically used to guide the determination is not cut and dry. And tax advisors often advise "When in doubt, characterize the person as a W-2 employee, not as an independent contractor." That advice has never been more true than now, when our government is actively seeking ways to soothe our financial woes.

Though characterizing people as W-2 employees will impact retirement plans (given the discrimination testing requirements), mistaking employees for contractors will definitely sting! 

With over 20 years of healthcare law experience following his experience as legal counsel for the Florida Medical Association, Mr. Cohen is board certified by The Florida Bar as a specialist in healthcare law. With a strong background and expertise in transactional healthcare and corporate matters, particularly as they relate to physicians, Mr. Cohen's practice immerses him in regulatory, contract, corporate, compliance and employment related matters. He is the Founder of The Florida Healthcare Law Firm.

Cyber Discrimination: A New Frontier of Liability for Healthcare Providers (conclusion) Print E-mail
Written by Jeff Segal, MD, JD, FACS and Michael Sacopulos, JD   
Sunday, 01 May 2011 13:07

Continued from previous page.  CLICK HERE to read the article from the beginning.

Target is not the only organization whose website triggered a claim under the ADA. Southwest Airlines has been named as a defendant, as well as Twentieth Century Fox and Schering-Plough. It seems reasonable to anticipate a wave of litigation against healthcare providers that, in whole or in part, provide services to disabled individuals.

Title III of the ADA provides, “No individual shall be discriminated against on the basis of disability in the full and equal enjoyment of the goods, services, facilities, privileges, advantages, or accommodations of any place of public accommodation….” 42 U.S.C. § 12182(a).  Is a website a public place?  There seems to be so strong arguments that a judge could say, "Yes." 

“I hope that legislation will come about requiring anyone on the internet to make his or her site accessible.  I am dreaming but it is a hope,” Jacobsen said.

Mindy’s hopes are not far off. In July of 2010 the Department of Justice (DOJ) published documents saying they are considering updating the ADA regulations so that it would explicitly state that both state and local government and places of public accommodations must make websites usable to people with disabilities. Public comments were accepted by the DOJ for an advanced notice through January, 2011. Many take this as a clear sign that rules applying ADA regulations to commercial websites are coming in the near future.

To help physicians get a jump start before legislation may take effect, there are a handful of easy changes to their websites to make them more accessible. First, physicians who already have a website should get it tested for accessibility.

Accessibility Partners is a company that helps organizations implement electronic and information technology accessibility solutions for people with disabilities. Their company hires people with and without disabilities to scan websites to make sure there are no kinks during operation.

“If somebody doesn’t have use of their hands and arms and they have some type of mobile disability, they might use some type of speech recognition to navigate the web. If they are trying to research a medical practice in their city and they Google it and doctors office comes up and they get to the website and the website is not accessible for them; it might be like getting to the door and having the door locked and having the doorbell be out of reach. So it kind of cuts off, unintentionally a whole population of potential clients,” Dana Marlowe with Accessibility Partners said.

A screen reader can read almost anything - eliminating barriers for the blind like Mindy; until it comes across a graphic with no behind the scenes description attached to it for the screen reader to read.

“When my screen reader encounters graphics, it can’t read them. So it just quiets down and doesn’t do anything,” Jacobsen said.

This encounter has been described more graphically by Premium Websites web designer Dotty Scott.

“It is like somebody reading off a Uniform Resource Locator (URL) that has a bunch of question marks and numbers, stuff that is not relevant to what they are looking for. Unfortunately, most websites are built that way, so the person is actually forced to sit and listen to all of that before they actually get to the information they are looking to find,” Scott said.

Scott encourages all web designers to experience a screen reader. Then it becomes obvious what they need to do.

“It was shocking and eye opening. It is amazing to me, the patience blind people have to find anything on the internet. It really is an eye opener,” Scott said.

Here are a few changes physicians can make to their website to make them more user friendly immediately.

·Provide text alternatives ("alt") for images and other non-text content.

·Make it easier for users to read text by using high contrast colors between the text and background, and making text resizable.

· Provide captions and other alternatives for multimedia.

·Use headings to group information and mark up the heading in the code.

·Make all functionality available from a keyboard, since some people cannot use a mouse.


W3C is the international organization that defines the standards for the web. Within the W3C is the Web Accessibility Initiative (WAI). The WAI's core mission is to make sure the web is accessible to those with disabilities.


WAI has developed web accessibility standards that organizations can follow, although WAI itself is not an enforcement body. The DOJ is considering using those standards in revising regulations for the Americans with Disabilities Act. Shawn Henry has been working to help organizations understand WAI's standards with the hope that many will make the changes on their own.


"Organizations would be wise to think about accessibility when they are updating their website, instead of waiting until they get a complaint," Henry said.


For more information on how to make a website more accessible visit:

Dr. Jeffrey Segal, MD, JD, is Chief Executive Officer and Founder of Medical Justice and is also a board-certified neurosurgeon.   Michael J. Sacopulos is a Partner with Sacopulos, Johnson & Sacopulos, in Terre Haute, Indiana. His core expertise is in medical malpractice defense and third party payment disputes. Sacopulos may be reached at

Last Updated on Sunday, 01 May 2011 13:46
Examining Patient Decision Making in Selecting a Provider Print E-mail
Written by Jeffrey Herschler   
Wednesday, 27 April 2011 16:24

According to a research report entitled Selecting a Provider: What Factors Influence Patients' Decision Making? published in the March/April edition of the Journal of Healthcare Management, reputation of organization and reputation of physician(s) are the chief drivers in choosing a provider.  The study was based on 467 survey respondents at a large academic medical center in Minnesota.  The respondents were mostly white (87%), well-educated (84% had at least some college), insured (100%) and healthy (73.4% were in good health or better).  The group was broadly diversified over the age spectrum.

"In Network", appointment availability and physician referral were close behind reputations as an impetus to facility or clinic selection.    Interestingly, cost is only a factor in 44.29% of provider choice decisions illustrating the fact that healthcare is currently not consumer driven as we rely on third party payers.  Only 24.2% reported using websites that report clinical quality data.  That number is sure to climb in future surveys.  Advertising comes in tenth as a decision motivator, again underscoring the lack of consumerism in healthcare.  This also suggests that providers will be well served by establishing their reputations, contracting with insurers and addressing service and logistical issues before committing to advertising campaigns.

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