As we reported in 6minutes yesterday, corporate medical centre owner Primary Health’s takeover of Symbion will make it one of the biggest players in the field of health care.
The move will make Dr Ed Bateman’s company the largest operator of private medical centres in the country, adding more than 50 Symbion-owned GP practices to the existing 40 primary care clinics operated by Primary Health. The move will also make Primary Health the second largest operator of pathology labs, with about 36% of the market just behind Sonic Health.
The pathology business – especially the NSW operations have been described as the “jewel in the crown” in this takeover. In contrast it has been suggested that Symbion’s other assets – including pharmacies, consumer products and medical imaging – may be divided up or sold off.
The arguments over the good and bad points of corporate medical centres are well known. Many GPs are attracted by the prospect of letting someone else take over the burden of paperwork and the business side of running the practice. On the other hand, there are those who decry the focus on the bottom line, and who say that patient care is sacrificed in the name of increased efficiency.
But general practice is not the only area of medicine to see the encroachment of corporatisation. This week sees the publication of an interesting review of the changes that have occurred in radiology and imaging centres over the last decade.
Writing in the Journal of the American College of Radiology, radiologist Dr Howard Galloway describes how almost all independent radiology practices have been subsumed into corporate entities such as Mayne and Sonic Healthcare. He says that the initial round of consolidation allowed practices to benefit from better equipment through greater purchasing power and administrative efficiencies. But since then he says radiology groups have lost their commercial edge because unlike pathology labs they are essentially ‘people intensive’. Radiologists, he says, have not been happy about losing their independence or being pressured to be more productive and perform more lucrative investigations. The trend now is for smaller independent practices operated and owned by radiologists.
It will be interesting to see what direction general practice takes over the next decade – will we see more corporate health centres? Or might Federally-funded division-run “super clinics” be the way of the future?.
Comments
In radiology..PRP Diagnostic Imaging is a group of 32 radiologist in partnership who have left en masse from the private equity owned Imed network with almost all the techical and clerical staff following the Doctors into their new doctor owned venture..,,see the website http://www.prpimaging .com.au for the full story. Posted by Phil Lucas on Wednesday, 11 February 2009
My experience of a corporate is that their first priority is money, the second their contracted doctors, thirdly their own management staff whom they treat appallingly and lastly the patients, who are so many leaves on the medicare tree to be picked and harvested as income for the shareholders.
With regard to their doctors they strike a fairly benign note but their primary interest is in corralling general practitioners referral to pathology, the big money spinner in health. Their contracts( I failed to read mine carefully) are striking for their omission of the reciprocal rights and responsibilities of the contracting parties. It is not possible to withdraw from the contract citing the corporate's failure to provide high quality management services because they actually do not contract to provide anything at all!
With regard to their staff they systemically reduce the quality of the clerical staff to reflect both their contempt for the nature of the work and to meet the bottom line of expenditure. In doing so, they effectively destroy the important team relationship between doctors and front office staff, based on effective triage...that is the prioritization of patient needs. They trade in their mature and skilled older staff for, I'm sorry to say...bimbos, who by the way, never include males. (Would they work for 16.85 AUD per hour?).
There is a vacuum where there needs to be an effective model of primary care delivery to the Australian community Into this vacuum is sucked every failed theory and model for recycling, for the profit of the corporate founders, who have long since diversified into more productive ventures.
Corporate medicine has failed in the USA. It is failing in Australia. Everywhere the corporate set up their cut price medical centres, there is an enraged citizenry looking for alternatives. The corporates hope that before too long there will be no alternatives and patients will accept anything that is dished out to them.
Why do doctors put up with this. Some come from poorly run practices and undoubtedly it is a step up for them. Those from good practices gnash their teeth when they realize they have gone from the frying pan of small general practice into the corporate oven.
We need to prove the corporates wrong and convince our governments that they have no place in Australia.
Contribute to this blog. Posted by Dr Lewis Rassaby on Thursday, 28 August 2008
I've spent brainstorming sessions run by divisions thinking about the future of general practice, but suddenly it becomes clear where we are all heading. If a pathology company so much as gives me a coffee cup they have to justify it, and woe betide any company that gave me a computer. If a small GP practice lets a room to a pathology company and hikes up the rent, now they will be investigated. But if a corporate gobbles up a pathology company and puts all the earnings into a common pool and thence into the pockets of GPs then that is perfectly alright. Ordinary GPs cannot compete and will be driven out of business.
There is no money in general practice any more. Even though the AMA and RACGP cost me over $250k with their Non VR policies, and even though Non VRs returned the favour by costing every VR GP over $400k, I still have to thank both organisations for showing me how to make money in general practice. Essentially, don’t even try. I make the bulk of my income from a variety of sources, including divisions, workcover committees, 6 government advisory committees, surgical assisting and after hours work. I still manage 35 hours a week in standard general practice, but this is not for the money, it is for the love of the work. After expenses, all those other sources of income make three times the revenue per hour compared with general practice. To any GP struggling in general practice, thank the idiots in the RACGP and AMA for the situation we find ourselves in.
Corporate medicine makes its money from the add-ons – from pathology, radiology and possibly pharmacy and other internally referred specialist services. A few years ago BEACH measured the costs of a GP consult and the total was over $60 back when rebates were $25. These add-on costs are not a small part of the equation, they are actually the major part of the equation.
Dr Bateman’s model works. He may well hand over $250k to buy a doctor but he gets it back in spades within a couple of years. If he creamed off all the profit for himself he would be richer and we would not and nothing would change, but like every smart investor, he reinvests the profit into more growth. Every doctor generates profit to buy another doctor every few years. GPs in 2 or 3 doctor practices can’t compete as they can’t access the pathology and radiology profits. Primary grows and small GP practices stay static (or even shrink in number due to the provider number restrictions. Thanks to the RACGP for that one).
This is a Monopoly game, and we are now at the stage where Dr Bateman owns both Mayfair and Park Lane. Sure, there are still more of us in small GP practices and maybe we own most of the other properties, but the endgame is approaching. Even if small GPs stayed static and corporate practice only grew a few percent a year, the endgame happens very quickly due to the nature of exponential growth.
My advice for getting rich in general practice: Make the bulk of your income stream from non general practice sources but at the same time, keep your practice ticking over so it represents a saleable asset when the corporates come through with the offer that your partners can’t refuse.
Dr James Moxham, President, The Australian College of Non VR GPs. Associate in a 2 doctor practice with no affiliations to any radiology or pathology company.
Posted by James Moxham on Wednesday, 13 February 2008
I make twice as much now, working half the hours I did in a corporate centre. I am in a small private- billing cottage general practice like I started out in years ago and I love it. We have no nurse or ancillary services and it makes no difference to how I practice. I am the one responsible for my patients and their families and they appreciate it. I have no admin. to do as I do not own the practice. I have 3 full days and two half days off per week.
Unfortunately family practices like ours will die out as the government encourages GP super clinics.
The monopolising of medical service can only be detrimental to society,while lining the pockets of the corporate directors and the shareholders they are accountable to. Patient care, community health and the welfare of the centres' doctors and other workers run far behind. Posted by Mimika on Wednesday, 13 February 2008
The so-called benefit of giving up running a practice and the business side is a total myth because the GPs are still independant contractors who have LESS flexibility in their financial affairs but retain all responsibility for BAS, workers comp premiums and PAYG. They have neither the benfits of owning the business or being employees. I reckon if a corporate group actually employed GPs then they would have a lot happier more stable workforce. Posted by Andy on Wednesday, 13 February 2008
I have turned down an offer from Dr Bateman to buy my practice. I have resisted using Medical Director. I will now have to stop using Symbion. I see nothing good coming out of this take-over for general practice except the promotion of Dr Bateman up the list of Australia’s most wealthy.
Posted by John Pearson on Wednesday, 13 February 2008
