Comparing Two Physician Groups

Abstract 

Steven Jones recently returned from a week-long hiking trip. During the last leg of the journey, Steven fell causing a tear in the meniscus of the right knee. Steven visited the emergency room and was told to see an orthopedic physician to repair the meniscus. Steven has high-deductible insurance; he is responsible for paying all the out-of-pocket expenses until he reaches the deductible. Steven searched the internet for an orthopedic physician in his community and found two physician groups. The first group is a 35-physician group and the second one is a 10-physician group. The purpose of this research paper is to describe the positioning strategy for the two groups, their strengths, and weaknesses and the concept of package pricing. The paper concludes with a recommendation for Steven on the right physician group for his surgery. 

Positioning strategy 

A positioning strategy is the process in which an organization differentiates itself from competitors to attract customers. The 35-physician group is a medium size practice; it brings together many physicians while offering affordable care at the same time. The website contains information on partners, research, and educational material. The medium-size practice prides itself on bringing together expert orthopedic doctors and sharing their research and knowledge online to empower their customers. 

Macomb Orthopedic Group has ten physicians. It is a small practice, and it prides itself on offering personalized service to the clients (Mahat & Coates, 2016). Macomb’s website is highly detailed; it has information for each physician, price estimates and how to submit insurance. Macomb probably attracts few patients; the doctors have a patient-centered approach where individual needs are prioritized. 

Strengths and Weaknesses 

A significant strength for the 35-physician group is the financial consideration. A larger group divides expenses across all the physicians to reduce the financial burden for physicians and patients (Muhlestein & Smith, 2016). A larger group also has more purchasing power; it can negotiate deals on medical supplies and equipment rather than transferring the cost to patients. 

Physicians in a medium or large practice focus more on providing care for their patients rather than the administrative tasks, marketing and other activities that take them away from patients. Medium-scale practices have other departments dealing with administrative duties and the physicians focus on their patients. The website for the 35-physician group had research and information to help patients understand their conditions first. Large practices also benefit from a team approach to handle difficult patient problems. However, physicians in the 35-physician group see many patients at once. They do not have time to work closely with patients to empower them to make better choices as in a small practice. 

Small practices like Macomb Orthopedic Group have closer connections among patients, physicians, and staff. It is easier for patients to see the physicians, discuss their options and work together to achieve the best outcomes. According to Casalino et al. (2013), small physician practices have low rates of preventable hospital admissions. A disadvantage of small physician practices is that they struggle with costs. The insurers tend to pay lower premiums for small practices, and they do not benefit from the economies of scale as seen in medium and large-scale physician groups. 

Package Pricing 

Package pricing refers to a single comprehensive payment made to hospitals or physicians for a group of related services based on the anticipated cost. Bundled payment and has significant advantages for the patient (Mohnen et al., 2013). Bundled payment saves costs and increases efficiency. Bundled payment option is cheaper because the patient pays for a group of related services including post-op care at a discounted rate. Package payment is considerably easier; there are no confusion and accounting errors that could lead to increased cost. 

Package pricing can be disadvantageous to patients and the hospital. Steven is going for a meniscus repair, and it does not require a lot of care in comparison to chronic diseases such as diabetes and heart conditions. With the rapid changes in medical technology and procedures, what make sense for “package pricing” today might not make sense in the next three years; thus, the hospital has to keep updating the package price. Package pricing often fails to consider accounting, distribution of overhead and indirect costs, and this can cause financial problems for the practice. 

Recommendations 

Steven should go for his meniscus surgery from the Macomb Orthopedic Group. The group has ten physicians, and it has detailed information about the physicians on the website. Research studies show that small practices have low rates of preventable admissions in comparison to medium and large-scale practices. Macomb Orthopedic Group also offers package pricing, which is necessary after a procedure. Stevens will need a few physical therapy sessions and checkup for his knee. 

The first group has potential benefits too; it brings together many orthopedic surgeons with experience. However, from their website, the first group has failed to share pertinent information about physicians and payment that can help the patient to make the right decision. The first group needs to update its website to include payment plans and insurance to help patients make informed choices. 

References 

Casalino, L. P., Pesko, M. F., Ryan, A. M., Mendelsohn, J. L., Copeland, K. R., Ramsay, P. P., ... & Shortell, S. M. (2014). Small primary care physician practices have low rates of preventable hospital admissions.  Health Affairs ,  33 (9), 1680-1688. 

Mahat, M., & Coates, H. (2016). Strategic positioning of medical schools: An Australian perspective.  Medical teacher ,  38 (11), 1166-1171. 

Mohnen, S., Baan, C., & Struijs, J. (2013). The impact of bundled payments for diabetes care on curative health care costs-A 2-year follow-up study based on Dutch nationwide claim data.  International Journal of Integrated Care ,  13 (5). 

Muhlestein, D. B., & Smith, N. J. (2016). Physician consolidation: rapid movement from small to large group practices, 2013–15.  Health Affairs ,  35 (9), 1638-1642.