Business
Study finds economic power shifted to hospitals
NEWS IN BRIEF — Posted April 26, 2004
Hospitals and medical groups, once partners, are now more likely to be competitors with conflicting economic interests, according to a new study of California's health care market.
The study for the California HealthCare Foundation concluded that there has been a fundamental shift in the way economic power is held and used in health care business relationships. Under the old model, the report said, physician groups and hospitals shared risk. But that changed after the late 1990s, when the payment pools stopped growing, leaving less money to divide.
The study said that hospitals have used system building and more strategic negotiating to escape from risk-sharing contracts.
The study was compiled using data on health plans and hospitals as well as interviews with nearly 40 leaders of California health plans, hospital systems, state associations, purchasers and government agencies.
Note: This item originally appeared at http://www.ama-assn.org/amednews/2004/04/26/bibf0426.htm.
