Dive Brief:
- A new study published in Health Affairs has concluded that hospital ownership of physician practices seems to lead to statistically and economically significant growth in hospital prices and spending.
- While the hope has been that such integration would lead to lower hospital utilization due to better patient information flow and care coordination, this promise hasn't been realized, researchers say.
- That being said, it's worth noting that looser forms of vertical integration did not appear to increase prices or spending meaningfully, and might even decrease hospital admission rates, according to the study.
Dive Insight:
While these results don't look promising for hospital-physician integration, researchers point out that there may still be an upside. They note that metrics such as inpatient hospitalizations may fall once gaps are closed between physician practices and the hospitals with which they integrate. Over the short term, however, it seems that both hospitals and physicians will need to change their management style to deal with this unique relationship, including aligning compensation plans for doctors and hospital execs to be a more quality- and outcome-driven.