Cogent HMG CEO Steve Houff, MD, says the merger will mean investment in clinical support, physician recruiting, and technology, and will benefit patients and hospital partners alike.
“Both Cogent and HMG have a track record for delivering improvements in clinical quality and patient satisfaction at each of the hospitals we serve. The plan is for that to continue on a broader scale,” he wrote in an email to The Hospitalist.
I do think there will be more consolidation going forward than there is now, but I don’t see a future in which there are, you know, two or three groups that completely dominate the landscape.
—R. Jeffrey Taylor, president, chief operating officer, IPC: The Hospitalist Company, North Hollywood, Calif.
The Good, the Bad, the Oligopoly
The average size of a hospitalist group in the U.S. is about 10 full-time equivalents, according to recent survey data from SHM and MGMA. With the swelling of the size of HM’s biggest corporate players comes the question of how far the coalescing will go: Will most patient care eventually be provided by only a few groups?
R. Jeffrey Taylor, IPC’s president and chief operating officer, says the mergers and acquisitions will continue, but he doesn’t see a day when there will be just a few titans ruling all.
“I do think there will be more consolidation going forward than there is now, but I don’t see a future in which there are, you know, two or three groups that completely dominate the landscape,” he says. “There’s always that concern that that’s going to happen in the hospital industry, or that’s going to happen with payors. And there are always new entrants.”
For all the movement toward bigger companies, “this is still an unconsolidated industry,” and new physician practices will always continue to be formed, he says.
“We’re the largest group, and we’re maybe 3 1/2 percent of all the hospitals in the country. I wouldn’t consider this, today, a terribly consolidated industry,” he adds. “I do think it will move in that direction. I just don’t think it will get all the way there, because of the sort of private, entrepreneurial, independent spirit that’s common among physicians.”
Mike Tarwater, a board member of the American Hospital Association, says private hospitalist providers will only be an alternative to—and not a replacement provider for—large, self-contained systems like the Carolinas Medical Center (CMC), for which he serves as CEO. The health system has a wide spectrum of facilities—from large, urban academic centers like the 874-bed medical center in Charlotte, N.C., to 52-bed Anson Community Hospital in Wadesboro, N.C., population 5,780.
“As a system, we have the wherewithal and the recruiting expertise, and, with 1,700 physician associates across the system, we’ve kind of got critical mass,” Tarwater says. “So we will be an alternative to that in our region.”
Frank Michota, MD, FHM, director of academic affairs in the Department of Hospital Medicine at The Cleveland Clinic, says that the extensive training programs of many of the larger hospitalist groups (e.g. Cogent Academy, IPC’s extensive onboarding process and leadership conferences) could be a very good thing for the field.
“I have always thought that companies like Cogent did a very nice job in orienting their hospitalists to the patient-care goals and the process variables that were being measured,” Dr. Michota says. “I think that by making an even larger group, they have the opportunity to continue to standardize the approach to hospital care so that one hospitalist equals one hospitalist equals one hospitalist. I think that’s a positive.”