Independent physicians beware, Tenet might be cleaning house

The possibility that Dallas-based Tenet Healthcare, one of the nation's largest for-profit hospital networks, will abruptly end its service contracts with the medical groups providing anesthesiology, emergency department and hospitalist care at its hospitals in California has caused physicians to form a coalition specifically aimed at opposing the plan.

On May 27, Sierra Vista Regional Medical Center in San Luis Obispo, Calif., was notified that Tenet — the medical center's owner — was considering terminating its contracts with local medical groups in favor of using a national medical provider for anesthesiology, ED and hospitalist services, according to a report from The Tribune.

Sierra Vista physicians told The Tribune Tenet plans to use a national company for these hospital-based services at up to 11 of its hospitals in California.

The affected physicians were confused by the notification, and William Soggard, MD, chief of staff at Sierra Vista, said "It's certainly an unprecedented occurrence in my personal experience and probably with everyone else on staff."

Coastal Anesthesiology Medical Associates, a 22-physician group in Arroyo Grande, Calif., has a contract with Sierra Vista. The group was also notified of Tenet's plan to terminate contracts, and was informed that Tenet had requested proposals from national companies to provide services to several of its hospitals in California, according to the report.

However, on June 3, the physicians at Sierra Vista were told the tentative plan to terminate the contracts had been dropped; the physicians were not given any assurances their contracts would not be terminated at a later date, according to The Tribune report.

This temporary termination apparently didn't appease the 39,000-member California Medical Association, which sent a letter to Tenet in mid-June, explaining they had received numerous complaints concerning the possible contract terminations. "The sheer volume and force of the complaints raises serious concerns that cannot be ignored or discounted," the letter read.

The CMA wrote the letter after receiving various reports the for-profit hospital operator planned to terminate its contracts for anesthesiology, ED and hospitalist services at all of its hospitals in California.

Although Tenet declined to comment on which national providers were being considered for the contract, CMA attorney, Long Do, said Tenet was going to likely use one of three national multispecialty groups: Glendale, Calif.-based ApolloMed; Knoxville, Tenn.-based TeamHealth; or Dallas-based EmCare, according to a Physicians News Network report.

In August, an alliance of California health professionals launched the Coalition for Quality Hospital Care, a group aimed at stopping Tenet's plan to terminate contracts with independent physicians and hospitals across California. There are several hundred members, and the Coalition has gained the support of the American Academy of Emergency Medication, which has more than 8,000 physician members, and the California ACEP, with nearly 3,000 physician members.

Mark Reiter, MD, president of the AAEM, says if Tenet were to follow through with terminating existing contracts, it would leave a significant number of physicians displaced. The physicians would be forced to either subcontract with a national company or leave their hospitals. Some physicians would also accept contracts with staffing companies outside of California. "In these situations, the physicians will often face unfavorable contract terms, lower compensation, lower staffing levels, and a loss of independence," says Dr. Reiter.

According to Sierra Vista, a final determination has not been made regarding the contract terminations, and the hospital has sought input from its medical staff leadership and membership as well as members of its governing board concerning the plan. Additionally, the hospital says no final decision will be made until a full evaluation is made based on recommendations from both groups. 

More articles on Tenet: 

For-profit hospital stock report: Week of Aug. 25-29, 2014 
Tenet, Community Health Systems to benefit from Pennsylvania's Medicaid expansion  
Tenet reports $26M net loss for Q2 

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