Resolving Problems in a Multi-specialty Group Practice

You are the CEO of a large multi-specialty group practice and have financial problems, as well as conflicts over compensation between your primary care and specialty care physicians. There have been substantial changes over the years regarding payment structures, case mix, and capital costs. Now, the Patient Protection and Affordable Care Act (ACA) has added other potential changes into the mix and has raised the question as to whether your practice should become an ACO. Discuss what analyses you would undertake to evaluate the financial situation of and the conflicts within the group practice. Be able to justify the underlying rationale for the analyses and how you will use the results to address the financial concerns, the organizational conflicts and the potential changes facing the organization. This question response should explore organizational behaviors, financial and budgeting issues, personnel management and strategic planning.
A multispecialty group practice is one that consists of individual physicians who offer various medical and specialty services in that practice by contracting to a managed care plan. Managed Care Organizations are formed by insurance companies that either own a provider network or create one by arranging with independent providers (Gapenski, 2009). The payment structure used to reimburse providers regardless of services provided falls into the category of either fee-for-service or capitation based. Fee-for-service is the reimbursement according to services provided, either through reimbursing based on the cost of services provided or reimbursing based on rate schedule of services provided. On the other hand, in the Capitation system, providers are paid a fixed amount depending on the number o...

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