Advocacy Organization President: Private Practice Is Becoming a Niche
A new physician-led national advocacy organization seeks to empower independent medical practices during major consolidation among hospitals and payers. The American Independent Medical Practice Association (AIMPA) aims to level the playing field regarding reimbursement for independent practitioners and that of hospitals. AIMPA was launched in October of 2023 with approximately 4000 doctors and has since doubled its number of participating physicians.
Healthcare Innovation recently spoke with Dr. Paul Berggreen, M.D., president and board chair of AIMPA. Berggreen is a gastroenterologist and founder of Arizona Digestive Health, chief strategy officer for GI Alliance, and chair of data analytics for the Digestive Health Physicians Association. He has been in private practice since 1988.
Could you tell us why you felt a need for a new advocacy organization?
My partners and I think that we deliver wonderful care to our patients in an independent setting where we take care of them the way we were trained to take care of them and have the autonomy to do so. What we've seen in the last five, but more like the last 25 years, is dramatic changes in the employment of physicians by hospital systems. As hospital systems have consolidated, they have increased their employment of physicians. Back in the 80s, when I was in medical school, about three of every four physicians in this country were an independent private practitioner. At the end of 2021, that was one in four. There are imbalances in the playing field of how hospitals get reimbursed and how independent physicians get reimbursed for performing the same service. It tilts the playing field in favor of hospitals and hospital employment. We've also seen the rise of these corporate employers. Optum now employs or is contractually aligned with 90,000 physicians in this country. That's 10 percent of all physicians in the country working for one massive corporation.
I'm a gastroenterologist, so when I perform a colonoscopy at my outpatient ambulatory surgical center and do the same procedure in the hospital, I get paid the same amount for my professional services. The facility fee at my endoscopy center is dramatically lower than that at a hospital because of the site-of-service differential, meaning hospitals get paid more for the same procedure. No better quality, no better outcomes. I don't see the point in that because, quite frankly, we deliver the same service, and we do it at a better cost, more convenient for patients, and the same or better quality. Why would there be a payment differential to hospitals?
Another example is the SO340B drug program, a system where hospitals can care for underserved communities. This allows for buying high-dollar drugs at a sharp discount and delivering them to the patients at retail prices. We private practice practitioners can deliver those same drugs, and we do, but we have no such benefit. So, we pay whatever the drug manufacturers want us to pay for those drugs, and we deliver them to our patients and our private offices, same drug, more convenient, no change in outcomes.
We are financially disadvantaged, and some of those policies impact independent private practice medicine. We formed AIMPA because of some of these things, and really, the American Independent Medical Practice Association is the voice of independent medicine in this country. Over the last 20 years, physicians' payments have only increased by about 10 percent. Inflation increased 76 percent in that time frame. Payments to hospitals have kept up with inflation. When you look at real dollars over the last 20 years, we're getting paid 26 percent less for doing the same service that we did 20 years ago. You see independent medical practices basically becoming insolvent or throwing up a white flag and saying we can't keep our doors open anymore; we can't make any revenue. The problem is accelerating. Private practice in this country is going to become a niche, and physicians will have fewer employment options. Patients are going to have fewer choices of who to go to. They're going to go to physicians employed by big hospital systems or big corporations, and we don't feel that that's a good trajectory. We think that independent practitioners deliver high-quality care to our communities. We've been here forever, and we're not going anywhere. We want to make sure that some of those factors that are not contributing to a level playing field are addressed.
What can AIMPA do that’s not already covered by existing advocacy groups?
We've been on Capitol Hill for years, some for decades, but as a specialty, not as the voice of Independent Medical practices. I'm in a group called the Digestive Health Physicians Association, which has 2,700 gastroenterologists around the country. We go to Capitol Hill once or twice a year and lobby for things like access to colon cancer screening and removing barriers to care. So, we've been there, but advocating for things that are just in our specialty, and many other specialties do the exact same thing. I'm a gastroenterologist, but we have dermatology, urology, orthopedic surgery, nephrology, emergency medicine, and ophthalmology. It goes on and on, and the issues affecting all of us are common. They're all rooted in these imbalances in the payment system. We find ourselves disadvantaged and need to draw it to someone's attention. One of the big issues is that if we don't do something to address these inequalities, we will see private practice shrinking. The cost of care is going up because patients are going to be driven to the hospital-employed physicians and the corporate employees--physicians who have significantly more bargaining power with commercial insurers. We have six hospitals in the city and all these other lines of service that you have to have. Insurers are going to pay a lot more attention to the hospital system than they are to us. Their rates are significantly higher for commercial plans; those imbalances are the site-of-service differential. We seem to be disadvantaged in both segments, federal and commercial payers, leading to significant financial stressors for independent practice.
Could you speak to payment, policy, and regulatory issues?
About one-third of our business, gastroenterology, is usually Medicare. We do a lot of colonoscopies. The patients tend to be older people, making up much of our business. We have to pay attention to those federal policies impacting payments from Medicare, including the Medicare physician fee schedule cuts and the site-of-service differential. A big segment of our patient population is commercial payers, whether Blue Cross, United, Cigna, Aetna, or Humana. We're on our own when negotiating rates as best we can with those payers. We don't have as much clout, and we often take what we're given because we need to see those patients. We will serve our communities, but that's again where we find ourselves somewhat disadvantaged. We feel that if private practice further diminishes, there will be less competition in the marketplace, and we find that private practice medicine is an effective counterbalance to large corporate employers or hospital systems. I'm not knocking on any other form of care delivery; they all have pros and cons. We just wanted to make the playing field as level as possible.
As private practice doctors, we can make a significant difference in our communities, and some of the positive things we're doing can only be done as we get larger. We have gotten larger. In 1993, I joined a practice of three other doctors in central Phoenix, and we were just a happy group of four doing our gastroenterology thing. We became a group of eight in 1999, and then in 2007, due to some significant pressures in the marketplace, I put together a merger of seven independent GI groups in Phoenix. Overnight, we became a group of 35, and we were able to take advantage of some economies of scale and stabilize our insurance rates. We offered services that we could do better and at a lower cost. We've built a pathology lab for the biopsies we take during a colonoscopy. In 2019, we joined a large group in Dallas and another in Illinois in Chicago to become the GI Alliance. Suddenly, we had 220 doctors in three states, and we have continued to grow. Eight years ago, I put together a population health program in Arizona to take care of our complicated inflammatory bowel disease patients. We were able to manage hundreds of patients through that program effectively. We've grown dramatically, and we're now in 19 states. Many of those states are using the whole concept of population health to improve the care delivery that we offer to those patients to keep them away from the hospitals; emergency room visits, unplanned surgeries, unplanned abdominal imaging--all those things that are not good for patient outcomes. Some of the things that we've done as a large organization have allowed us the resources to do this kind of thing and improve the population's health.
What is the average number of physicians in the groups that you represent?
Our smallest group is just 27 doctors. Our largest group is 3000. We're seeing a pretty dramatic level of interest here.
What is the primary goal of AIMPA?
Our main goal is to make sure that independent private practice remains healthy in this country and is not disadvantaged by healthcare policies, whether federal or state. We also want to educate people, including policymakers, on the benefits of keeping independent private practice healthy in this country. I think they realized there's been a dramatic amount of consolidation; they probably haven't done the mental math to see what that will look like in five or ten years. We've been to Capitol Hill twice so far, and we're going again, probably later in the spring, to keep up the education campaign.
Could you speak to the founding principles?
Number one is that we're the voice of independent medicine. Number two, private practice medicine in this country delivers on the three things that we think are most important: quality, access, and cost. We know from published studies that quality delivered by private practice medicine is equivalent to, or in some studies, better than, quality delivered by other forms of physician employment. We know that access is an issue in this country and that the vast majority of our members accept all insurance plans, including Medicaid. Then, finally, there is the cost, and that's where I think we, as independent practitioners, have a clear advantage. Multiple studies have shown that because of those payment disparities with Medicare, we deliver equivalent quality and access but dramatically lower costs to the system and the patient. This is very real on a patient-by-patient basis because if we deliver less expensive care for a certain service to you. You're going to see that in your copay and your deductible and how much your bill is compared to if you did the same procedure in the hospital outpatient department. That directly affects your checking account, not just the macro system.
What are some of the biggest challenges you have seen so far?
I think one of the biggest challenges is educating people appropriately on what it is that private practices are doing to remain private. There’s a Women's Health Group in AIMPA that has formed an MSO (Management Services Organization). The MSO does everything physicians don’t like to do, such as billing, human resources, and contracting. Many of our groups have gotten a financial partner with that MSO. It provides high-level administrative talent, people who can run a large group, who have that experience and that expertise, and who we, as a group of even 50 in Phoenix, couldn't afford. Another example of a group that's part of AIMPA in Colorado was able to build two additional outpatient surgical centers to do their colonoscopy procedures because of their association with an MSO backed by a financial partner. That delivers the same quality care to patients at a significantly lower cost than bringing those patients to the hospital outpatient department. They were able to build those two centers and provide that service to their communities. Back in the day, those physicians would have had to go to Bank of America or Wells Fargo and get a loan, and your collateral was your house. No one’s willing to do that anymore. The risks are too high, and the competition is too fierce. Having a financial partner gives us access to capital without having to be personally responsible for the loan. One of the educational pieces we're after is to say if we have private equity involved in our MSO and a business office, then that's just a neutral financing mechanism. They have absolutely zero control over any clinical decision, practice pattern, or physician's decision period. There’s an underlying current of thought that if you have a private equity partner involved in your business, they're telling your doctors what to do and how to practice, and nothing can be further from the truth. We're trying to change that narrative as well.
What is your message to hospital administrators?
Hospital administrators are not the enemy. We have a very strong relationship. Many of us have relationships going back decades with our local hospitals; the administrators are our colleagues. There's a wonderful place in our community for that type of model. We simply want a level playing field. There’s an important message to be put out to the public and policymakers: A limited number of factors significantly discourage private practice medicine. We need to make sure that our practice model is treated fairly and equitably.
There's a real problem in this country with burnout among physicians. When I see the numbers, I ask why more physicians are burned out in hospital-employed models than in private practice models. One of the big factors is autonomy. When you get into a big corporate system with many rules, regulations, and guardrails around what you can do, it takes away your autonomy a little at a time, and you get increasingly frustrated. That leads to burnout, which leads to people looking for some other model of employment or some other job that's not being a doctor, which is a tragedy. From a personal experience in Phoenix, in the last two and a half years, now close to three, we've hired nine new associates in my group. Six of them are not coming out of fellowship programs but out of hospital employment. They were disillusioned. Those little things that are out of the physician's direct control make the physician's job harder. Many physicians in this country feel that independent private practice is the best type and way to deliver medical care.
