How PE is Undermining Emergency Rooms and Physician Staffing

Anyone who works in hospital administration these days is well aware of the inroads being made by private equity firms on the hunt for ever more profits. What is not discussed as often as it should be is the impact that private equity has on emergency physician staffing and quality of care. One of the latest targets for private equity firms appears to be emergency rooms and it’s raising more than a few red flags. 

This Open Source MD article takes a critical look at the effect private equity firms and large physician staffing agencies have on the quality of care in emergency medicine. 

A Conflict of Interests: Private Equity vs. Hospital Staff

The crux of the problem is that private equity firms are designed to do one thing: Make money. Let’s face it. Not every PE firm is interested in building something of value for posterity or supporting noble institutions and helping them grow. Regardless of what their press releases may say, profit is what they are after, first and foremost. 

If what’s good for patient care happens to make them more money, so be it. But PE is more often than not undermining emergency physicians and nurses and making it more difficult for them to deliver the quality of care they intend.

The captains of finance who man these PE juggernauts swore no Hippocratic Oath. Even in the cases where physicians are found in the leadership of the giant physician staffing agencies they own — the focus is always on finance. Simply put, they have no moral quandaries about pushing hospital staff to the absolute limit with little regard to how it affects morale or patient care. 

The goals of PE firms and hospital physicians are often misaligned because:

• PE views the hospital as a revenue source and has little real-world understanding of what makes a hospital department like an ER sustainably perform at its best.
• Physicians and the hospital are not best served by staffing decisions being made by people who aren’t on the ground or in the theatre. 
• Doing what may be best for short-term profit gains and stock prices without consideration for the impact on care quality and sustainability is a recipe for disaster. 

How Private Equity Impacts Quality of Care

The staff of a hospital rely on one another in ways that people working in most other industries may struggle to grasp. Healthy morale and esprit de corps are essential to the optimal functioning of any hospital department. 

Perhaps that’s true nowhere more than in the emergency room. Physicians and nurses work under tremendous pressure and literal life-and-death circumstances every day. 

When a PE firm assumes control and inserts its own enormous corporate nurse and physician staffing agency or contract management group— that conflict of interest we mentioned earlier raises its ugly head, the priority is profit over all else. 

Poor ER Physician Staffing Leads to Lower Morale and Higher Attrition

In the typical corporate ER staffing arrangement, physicians and nurses are shuffled around like cards in a deck. There is little appreciation for the real-world impacts. They’re seen as nothing more than employee numbers by an ER staffing agency that handles tens of thousands of individual nurse and physician contracts. 

The typical PE-owned hospital staffing agency cares little about breaking up existing clinical teams and relationships that are working well. Individual excellence and expertise are rarely considered either. Is it any wonder that hospitals struggle to retain talented emergency physicians on staff? 

A Lack of Insight and Understanding Leads to Lower Quality of Care in the ER

This doesn’t imply any nefariousness — PE firms are simply too big and too focused on profits alone to appreciate the practical concerns and human consequences involved in day-to-day hospital management. 

What hospital can afford to wait until the quality of care, physician morale, and turnover get bad enough to warrant a revenue crisis that gets the attention of the people calling the shots? Who understands what makes an emergency room operate at maximum performance better than the ER physician with his or her boots on the ground?

How PE-Run Hospital Staffing Undermines Hospitalist Services

The hospitalist plays an essential role in the efficient operation of any hospital. Examine any hospital known for a higher quality of care and high patient satisfaction scores, and you will find that almost every single one of them has at least one thing in common—a well-run hospitalist service with physicians who feel like they are heard and are truly a part of the hospital. 

Developing high-performance hospitalist services is our forte at Open Source MD. Unlike typical third-party staffing agencies, we do not come between hospitalists and hospital leadership. Instead, we facilitate these relationships and help hospitals create an environment that helps them retain talented physicians in the hospitalist role by helping them perform at their best. Learn how our innovative hospitalist staffing model works here. 

PE firms and their corporate hospital staffing agencies undermine the quality of care by:

• Disregarding the knowledge and experience of the emergency physician and others in the field.
• Needlessly breaking up clinical teams that are functioning well for the sake of convenience.
• Providing insufficient staff coverage, pushing physician-to-patient ratios to the limit, and increasing ER wait times. 
• Failing to develop a well-run hospitalist service with healthy morale, limiting turnover, and other factors directly affecting the quality of care patients receive 

Open Source MD: Sustainable and Ethical Physician Staffing Solutions

Now that the problem is firmly in focus — let’s talk solutions. In the past, emergency physicians formed small cooperative groups that contracted with hospitals. This arrangement works because practicing ER physicians collaborate democratically. Physicians share the decision-making and profits and the group is managed by professionals with a clear view of what’s happening in the emergency room. 

The large-scale, corporate physician staffing contract management groups (CMGs) created by private equity have completely up-ended that well-functioning ecosystem. We believe that is what’s at the heart of the problem. It is a myth that unacceptable shortcuts are the only path to hospital profitability. 

Open Source MD’s alternative physician staffing model restores balance and order. How? It’s simple: We eliminate the 800-lb gorilla in the room. By connecting physicians directly to hospitals and working to foster long-term, mutually beneficial working relationships, 

Open Source MD is the remedy to the toxic hospital staffing model that is undermining morale and putting patient care in the back seat to PE profits. 

How Open Source MD solves hospital ER staffing problems:

• Physicians contract with the hospital — not a third party. 
• Open Source MD facilitates long-term relationships between hospitals and physicians. 
• Smarter scheduling model ensures appropriate coverage and reduces patient handoffs.
• Frees hospital administration to focus on other process improvements. 
• Promote higher patient satisfaction scores.

Open Source MD: The Way Forward for ER Physician Staffing

You deserve a mutually beneficial relationship with your physician staffing partner. Refuse to settle for a corporate middleman that stands between you and your emergency physicians and hospitalists. The giant PE-owned and operated hospital staffing agencies offer little in the way of advantages and offer arrangements that are rife with compromise. 

Open Source MD has a better way. We provide physician staffing solutions that outperform the usual temporary and locum tenens arrangements in every metric — and that’s just the start. At Open Source MD, we connect physicians and hospitals so they can build enduring relationships as partners.  

Find out how Open Source MD’s staffing solution can help restore harmony to your emergency room and the rest of your hospital. 

Please call us at 336-997-9840 or contact us online to learn more.