The Importance of RNI’s Independence from Hospitals

You have probably received a letter from one of your doctors stating that they “have joined” a larger health organization.  They reassure you that this won’t affect you, and that your experience won’t change a bit.  Yet in reality you will not receive the care you did when they were independent.

This doctor’s “administrative change” hurts you in two ways.

Direct harm to patients:

  • More expensive — Hospitals have used their power to write rules in their favor.  They receive around three times as much for outpatient services like MRIs.  Since patients generally pay a percentage of the billed cost, you pay more for the same thing.
  • Referrals limited to their “in-house” partners — HMO’s got a very bad reputation a few years back because they limited patients’ choice of specialists and service providers, often to a single choice.  With hospital-owned “private” practices, it’s the same thing all over again.  Even if your insurance lets you see any specialist on a long list, your primary care physician has strong incentives to make sure you see a specialist in their new parent organization.

A new investigation in the Charlotte Observer makes this point very clearly.

Indirect harm to patients:

  • Higher costs impact what’s covered — When Medicare or private insurers see costs go up, their response is always to further limit patients’ coverage.  They raise co-pays or make it harder to get services approved.
  • Fewer and fewer doctors will remain independent — The hospitals are gobbling up private practice clinics for business reasons:  By trapping patients within their self-referring system, they keep all their medical dollars in their own coffers.  This means remaining independent doctors see fewer referrals, making it all the more likely they’ll sell out to a hospital.

You can see how vicious this cycle is:  Hospitals use their power to rewrite the rules, control patients, starve specialists of referrals, and then buy the weakened specialists.  They then use their increased size for political leverage, stacking the system further so that they can gain more profit.  Rinse and repeat.

We believe that by exposing this scheme to the light of day we can bring power back to the independent doctors who made American medicine the best in the world.

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