Why 150+ physicians exited hospital contracts this year

Primary care and specialty physicians across the U.S. are cutting ties with hospitals and health systems after a turbulent year during the pandemic.

In some cases, long-standing disagreements have driven an irreparable wedge between physicians and health systems, while in other situations financial stress has required hospitals to reevaluate their plans. Health systems are also boosting their efforts to keep patients within their networks and developing their own outpatient center strategy.

Here is why more than 150 physicians exited hospital contracts in the past six months:

1. St. Louis-based SSM Health split with St. Louis Heart and Vascular after nearly 30 years of collaboration to pursue an exclusive contract with another cardiology provider for adult services. St. Louis Heart and Vascular sued SSM Health March 31 for $50 million over the lost privileges, although it can still see patients at other hospitals and its ASC. SSM Health said the exclusive contract with the other unnamed cardiology group would boost care and business practices.

2. Three orthopedic surgeons, Brian Cohen, MD, Aaron Roberts, MD, and James Thompson, DO, were among 18 physicians who tendered their resignation from Chillicothe, Ohio-based Adena Health System in the past several months. The health system sued the three orthopedic surgeons in April for allegedly encouraging the others to leave Adena. The surgeons filed a countersuit in May, claiming the health system breached their employment contracts and spread misinformation about them to their patients. In their lawsuit, the surgeons cited tensions dating back to 2017 that escalated in the past year.

3. Eighteen gastroenterologists made plans to leave Cincinnati-based TriHealth earlier this year, with most citing safety concerns related to supplies, lack of support staff and reduced access to hospital facilities as the reason. If 75 percent of the GI department exited together, the noncompete clauses in their contracts would become unenforceable. The health system sued the physicians in March to keep the noncompete clause in place, arguing that one of the gastroenterologist's planned retirements shouldn't be counted within the total number of departures.

4. Tower Health in West Reading, Pa., is closing or consolidating some of the 134 practices within its medical group as part of a restructuring plan. The restructure, which was announced in May, affects 95 of the group's 876 physicians, some of whom are entering private practice. Tower Health CEO P. Sue Perrotty said the move will improve the health system's finances by $70 million by the end of the second quarter.

5. Sixteen physicians exited Asheville, N.C.-based Mission Health's Transylvania Regional Hospital earlier this year, the latest in a larger exodus from the health system, beginning in 2019 when it joined Nashville, Tenn.-based HCA Healthcare. The most recent group of physicians leaving Mission Health plan to continue practicing medicine in Transylvania County, with some planning to join competing clinics. The hospital is offering new contracts to physicians for 10 percent to 25 percent less than the exiting physicians made. Brevard, N.C., leaders urged the state's attorney general to investigate why physicians are leaving the hospital in May.

6. Advanced Orthopaedic Specialists' four physician partners disbanded in March after Laconia, N.H.-based Lakes Regional General Hospital decided not to renew it's 17-year contract with the practice. The health system said the existing service agreement was no longer financially viable. In June, the surgeons joined Appledore Medical Group and Frisbie Memorial Hospital in Rochester, N.H.


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