Sackett said the three-year exclusive contract, put in place about a year ago, creates a coordinated approach to cardiac care that benefits patients. Hospital staffers become accustomed to working with the same group of surgeons, another plus for patient care, he said.
Kettering’s contract with Kettering Cardiothoracic and Vascular Surgeons Inc. is significant. In 2010, 489 valve or coronary artery bypass graft operations — the kind of work covered by the exclusive contract — were performed at the hospital.
The surgeon group, which bills itself as the “only dedicated group of heart surgeons at Kettering Medical Center,” includes Peter M. Pavlina, Thomas J. Merle, Karl J. Borsody and Bruce H. Rank. Borsody and Rank are employees of Kettering Health Network’s Alliance Physicians Inc.; Pavlina and Merle are not.
“National performance standards and the growing complexity of cardiovascular care being provided to older and sicker patient populations have made it increasingly important for hospitals and physicians to work together in a synergistic manner,” the surgeon group said in a prepared statement.
Exclusive contracts are more common locally in diagnostic and more general areas of medicine. Radiologists, anesthesiologists, pathologists, emergency room doctors and hospitalists are more likely to have them.
There are currently no other exclusive contracts for highly specialized surgical services within Kettering Medical Center or other Kettering Health Network hospitals, Sackett said. But that could change.
“The future really does look like high volume centers that specialize in highly technical procedures with exclusive arrangements centered around groups of highly specialized surgeons or physicians,” he said.
So far, however, such contracts are rare locally. The Children’s Medical Center of Dayton does not have exclusive contracts with surgeons. Kettering competitor Premier Health Partners has one exclusive contract with specialists; since 2005, Premier’s Upper Valley Medical Center between Troy and Piqua has contracted with a gastroenterology group, Digestive Specialty Care Inc.
The federal health care overhaul is spurring interest in exclusive contracts, said Patricia S. Hofstra, a Chicago attorney who has represented both hospitals and physicians in exclusive contract matters.
To better position themselves for the overhaul, health systems, hospitals and doctors are likely to form “accountable care organizations,” through which they would aim to collaborate to manage care and hold down costs. Starting in 2012, ACOs get a cut of the cost savings they achieve for Medicare.
Reductions in Medicare reimbursements to physicians and the influence of managed-care contracts also are driving the trend toward more exclusive contracts, Hofstra said. And hospitals gain more control through the arrangements, she said, often to the benefit of patients.
Hospitals are also gaining such control by employing physicians directly. The Dayton Daily News found in 2010 that nonprofit hospitals, the Dayton VA Medical Center, Wright State University and Wright-Patterson Medical Center employed nearly 1,000 physicians. That number is growing. Kettering Health Network’s two physician groups, for example, nearly doubled the ranks of their doctors between January 2008 and July 2010, from 79 to 151.
There is a downside to exclusive contracts, Hofstra said. Both ACOs and exclusive contracts are “going to crowd out private practitioners and people who aren’t part of a network,” she said. And those excluded clinicians, she said, may very well be good doctors.
The Ohio State Medical Association is comfortable with exclusive contracts, provided they are geared toward ensuring patient access to high quality care and aren’t done solely for economic reasons, spokesman Jason Koma said.
Exclusive contracts — especially those that limit other physicians’ privileges — have faced legal challenges, but courts usually uphold them.
Two surgeons lost the ability to perform such surgeries at Kettering Medical Center due to the exclusive contract, Sackett said.
One surgeon, Dr. Pankaj Kulshrestha, called the contract anti-competitive.
“There’s a sacred space between a patient and a physician,” Kulshrestha said. “The hospitals should get out of that space and let the (referring) physician decide where to send that patient.”
Kulshrestha, who was employed by Alliance Physicians from 2008 to 2010, said he still has privileges to perform surgeries at other Dayton-area hospitals, including KHN’s Grandview Medical Center.
Kulshrestha said the exclusive contract limits his ability to grow his practice, Dayton Cardiac Surgery, which is based out of the East Medical Plaza at 627 Edwin C. Moses Blvd.
“They’re very good surgeons,” he said. “If they’re the best, why do they need to be exclusive?”
Cathy Levine, executive director of the Universal Health Care Action Network of Ohio, a patient advocacy group, said patient choice must be balanced with patient safety.
“If having continuity of staff is going to increase patient safety, then patient safety trumps patient choice,” she said.
About the Author