A leading physician group in Westchester County is not waiting for the legal challenges and trillion-dollar federal spending cuts that cloud the future of health care reform to be resolved before staking out a profitable place in that uncharted territory.
Westmed Medical Group, the 15-year-old, 200-physician practice based in Purchase, is ready to roll out the “polyclinic” model of outpatient care it has successfully developed in Westchester communities for hospitals and other physician groups adapting to a new and expectedly less costly and higher-quality system of health care delivery in the U.S.
Westmed”™s latest model for “one-stop” outpatient care is in the Ridge Hill mixed-use development in Yonkers, where an Oct. 14 ribbon-cutting ceremony will mark the opening of an approximately 84,000-square-foot medical office staffed by Westmed primary-care and specialty physicians and offering lab, radiology and urgent-care services. The physician group also operates polyclinics in Rye and White Plains.
Joining in a panel at a recent daylong health care forum sponsored by the Westchester County Association, Dr. Simeon Schwartz, Westmed”™s founding president, said the physician-owned practice in July formed a second company, Westmed Practice Partners, to provide turnkey delivery and management of polyclinics for partnering hospital systems.
Schwartz declined to be interviewed by the Business Journal about Westmed”™s new management services company until the business “is further along.” Westmed is seeking clients in markets beyond its local service area.
The Westmed Practice Partners website indicates the company is positioned to venture far from its physician-owners”™ clinical practice by offering its clients construction and facility design services and medical administration that includes credentialing, finance, human resources, information technology, marketing and revenue cycle and risk management.
“Hospital systems anticipating the changes in health care are looking for low-risk solutions for primary care and outpatient facility expansion without being distracted from their core activities,” Schwartz said in a statement on the website.
With the Patient Protection and Affordable Care Act of 2010 pegging future reimbursements to health care providers based on quality and cost-efficiency of care, the polyclinics “provide a platform to develop the physician culture and system infrastructure for delivering the clinical care coordination necessary for success,” Dr. Barney Newman, chief medical officer at Westmed, said on the Westmed Practice Partners website.
Schwartz”™s co-panelist at the health care forum, Michael Weber, president and CEO of Health Quest, which operates three hospitals in Putnam and Dutchess counties, said hospital systems must be larger than they are today to achieve cost savings and muster the equity to implement new technologies and reforms in an era of stagnant or decreasing reimbursement revenue.
“The pressures are mounting” for hospitals to consolidate and reduce duplication of services, he said. “Even some of the (existing hospital) systems can”™t stand alone and need to become larger.”
Weber cited the example of Health Quest”™s $65 million project to install a new IT system at its Northern Dutchess Hospital, Putnam Valley Medical Center and Vassar Brothers Medical Center. “This is something we would not have been able to do separately” at each hospital, he said.
Weber said consolidation typically is not easily achieved, as it threatens the job security of hospital executives and the autonomy of hospital boards and CEOs.
Weber said the physician group clinic, such as those that have improved the financial position of Westmed doctors in the last decade, “is severely harming the hospitals” by offering services traditionally provided by hospitals. Required to operate 24 hours a day, hospitals have higher overhead and labor costs and are far more regulated than physician groups, he said.
“Not only are we losing business or patients, we can”™t afford to continue to take a hit,” Weber said.
Physician groups “are our most significant competition,” said Weber. “It”™s a crazy situation. I don”™t know of any other industry where the people you have to work most closely with are also your most intense competitor.
“We need to find a way to partner with the medical staff and see if we can make that happen.”
Westmed”™s newly launched business model could be that way.
