You wait weeks to finally get an appointment with your doctor – and then don’t get a chance to discuss all your health concerns. Your doctor seems caring, but rushed. Doctors used to be friendly and helpful, taking time to listen to patients’ concerns and answer their questions. Now they seem to be checking off boxes and seeing patients as if on an assembly line. How did that happen?
The short answer is: Doctors don’t work for you anymore. They work for big business.
Over the last several decades, health care has undergone a radical transformation. “When we look at the data on the health care system at large, what we're seeing is really rapid consolidation,” says Jane Zhu, MD, an Oregon Health & Science University researcher who studies this aspect of health care. Corporations are buying up hospital systems, nursing homes, physician practices, and pharmacies. According to a 2021 report by the Physicians Advocacy Institute, almost three-quarters of American doctors are employed by hospitals or other corporate entities. The people running these juggernauts are not doctors. The backgrounds of most board members of health care corporations are largely in finance and business, not medicine. Even nonprofits operate more like corporations than public service organizations. In health care, “The distinction between for-profit and not-for-profit has been blurred as health care organizations compete with each other and angle for market share,” says Thomas G. Cooney, MD, professor of medicine at Oregon Health & Science University and chair of the American College of Physicians’ Board of Regents.
Another driver of consolidation is private equity, or “consolidation on steroids,” as Zhu puts it. Private equity firms buy existing health care businesses in order to make them as profitable as possible with the goal of reselling them for a profit within 5 years or so.
More Money, Worse Outcomes
At first glance, corporatized health care doesn’t seem like a bad idea. Having business people at the helm could make the entire enterprise more efficient. In other words, running medicine like you run any other business could conceivably make health care better.
But that’s not what happened. Instead, after years of increasingly corporatized medicine, we have higher costs, deeper medical debt, more bankruptcies – and worse health care.
According to a report released this January by The Commonwealth Fund, the United States spends more than any other high-income country on health care, yet it is the only such country without universal health care. But all that money isn’t buying Americans top-shelf health. The U.S. has the lowest life expectancy at birth, the highest death rates for avoidable or treatable conditions, and the highest maternal and infant mortality among high-income nations.
Meanwhile, paying for this substandard health care is getting increasingly difficult. Health care spending accounted for 5% of the U.S. GDP in 1960. In 2020, it was almost 20%. According to a report by the Kaiser Family Foundation, 100 million Americans struggle with health care debt.
What went wrong?
The goal of medicine is to care for patients. The goal of business is to make a profit. When those goals conflict, the patient should come first – but that’s not always what happens. “The fundamental concern about corporate involvement in health care is that there is a risk of prioritizing profits over all else,” says Zhu. In fact, in this business model, it’s all but inevitable. Those who run an investor-owned enterprise are responsible for ensuring that their investors make a profit.
“The grip of financial self-interest in US health care is becoming a stranglehold, with dangerous and pervasive consequences,” Donald Berwick, MD, former administrator of the Centers for Medicare and Medicaid Services and former CEO of the Institute for Healthcare Improvement, wrote in a January editorial in the Journal of the American Medical Association (JAMA).
These “dangerous and pervasive consequences” can be seen throughout the health care system. For example, a quarter of U.S. emergency rooms are managed by staffing firms owned by private-equity groups. In keeping with the goal to make as much profit as possible, these firms often cut back on the number of doctors on staff, resulting in longer wait times for patients and less time with doctors. Research by Zhu and colleagues found that gastroenterology, dermatology, and ophthalmology practices that had been acquired by private equity firms see more patients and bill more for visits than doctor-owned clinics.
In the push for productivity and thus higher profits, doctors are pressured to see more patients per day, says Cooney, thus cutting back on the amount of time and attention a doctor has for each patient. That means a doctor may not be able to fully address all the issues a patient wants to address in a given visit. It also means that health problems that might be less serious if caught early can be ignored until it’s too late; diabetes might be missed until it’s time to amputate a foot. “Physicians are the most expensive part of the equation for these firms,” says Robert McNamara, MD, professor and chair of emergency medicine at Temple University. “You're going to maximize that resource by making them work as hard as possible.” That pressure to rush, and to balance the demands of corporate leadership with the demands of the profession, has led to a crisis of burnout among health care providers.
Doctors face other pressures as well. McNamara recently published a study on the working conditions of emergency-medicine physicians. The doctors surveyed for the study report being pressured to admit patients who could be treated as outpatients (but to send home Medicare patients if their insurance won’t cover admission), to order more laboratory and imaging tests than are clinically necessary, and to discharge or transfer uninsured patients.
In addition, this model of health care can damage the relationship between doctors and their patients. When patients visit their doctors with a health concern, they depend on those doctors, who have years of training and experience, to advise them about what tests or imaging they might need, what medicines to take, and the risks and benefits of various treatments. “They trust that the physician is making those judgments with the best interests of the patient in mind, not the interests of financial entities or any other third parties,” says Cooney. Corporate medicine erodes that trust.
Until recently, most doctors still worked in private practice. Now, almost 70% of doctors in the U.S. work for corporations and hospitals.
If patients are just beginning to learn about the behemoth behind their health care, doctors look it in the face every day. But speaking up can be dangerous. Employed doctors often work under contracts that allow them to be fired at will with no due process. Many reasonably fear that speaking out would cost them their jobs. In January 2017, Raymond Brovont, MD, a Missouri emergency physician, was fired by EmCare, an emergency room staffing company, after he raised safety concerns about the level of staffing in the pediatric ER.
This is a huge problem for doctors whose job, as McNamara points out, “is to do no harm, to put the patient's interest first.”
Nonetheless, doctors are speaking up. One place they’re speaking up is in court.
Thirty-three states plus the District of Columbia have some type of restrictions on the corporate practice of medicine. The idea behind these regulations is to “make sure business interests cannot interfere with the physician-patient relationship, that the doctor who swears the oath to do what is best for the patient is the one who's making the decisions that could affect the patient care, not somebody from Wall Street,” explains McNamara. But corporations have figured out how to skirt these regulations.
The American Academy of Emergency Medicine Physician Group (AAEM-PG) has sued Envision Healthcare, a private-equity-owned physician staffing company, for violations of California’s laws prohibiting non-physician-owned practices. Similar suits are in progress in other states. “By getting court rulings, we’re looking to set precedent, which will then shake up the industry,” says McNamara, who is chief medical officer of the AAEM-PG. But he acknowledges that the approach is time-consuming and costly.
Meanwhile, doctors are increasingly turning to collective bargaining as the best way of protecting themselves and their patients. Fairer contracts and the ability to advocate for patients without fear of losing their jobs would protect not only doctors but their patients as well. According to the American Medical Association, as of 2019 almost 70,000 American doctors were union members, an increase of 26% since 2014. New doctors seem even more enthusiastic. The Committee of Interns and Residents, a union representing resident physicians, has grown from 17,000 to 24,000 members since 2020.
Ultimately, however, the solution may lie with the public.
The No Surprises Act, federal legislation that protects patients from unexpected bills for out-of-network care, took effect in 2022. It was the direct result of citizens organizing at the grassroots level, he says. The industry lobbied against it, but Congress listened to the people. “Getting pissed off can absolutely effect change,” says McNamara.
“We’re not going to fix [health care] if we continue to move in the direction of commodifying it,” says Cooney. “We need a coherent, rational, appropriately financed health system.” Exactly what that would look like is a matter that still needs to be debated, but there are plenty of examples to learn from. Cooney suggests that for inspiration, the U.S. should look to European models, where health care is less expensive and outcomes are better. For many Americans, the main point of comparison to the U.S. health care system is the U.K.’s National Health Service, which runs many of the country’s hospitals. But Robert Derlet, MD, professor emeritus at the University of California Davis School of Medicine and author of Corporatizing American Health Care: How We Lost Our Health Care System, points instead to countries with less well-known systems – like the Netherlands, whose public-private approach is “not as rigid as in England.” To keep costs of medicines under control, committees made up of doctors, pharmacists, and health insurers negotiate maximum prices, and, as Derlet points out, “deliver health care at half the price in the United States.”
“Do you want corporate medicine? Where one CEO’s goal is to make money off you?” asks Derlet. “Or do you want some socialized system, where the goal is to help you?”