PHARMACIST STEVE

Probably some definitions and explanations are needed here…. “Private Equity” is “businessmen”, for profit corporations that are acquiring office practices to MAKE MONEY out of owning there practices and often applying “common business practices” to lower overhead expenses and increasing profitability.

advanced practice providers (APPs) are also commonly known as mid-level practitioners ( NP, PA, ARNP, PharmD).  Generally speaking, services/care/procedures provided by a mid-level,  the entity they work for is reimbursed at abt 85% of what they would have been paid if it was provided by MD.

So, it would appear from this article, that these private equity firms that are buying these practice – in an effort to increase their bottom line – they are increasing the number of mid-levels to every MD on staff.

There’s More Clinician Replacement at Practices Acquired By Private Equity

These practices also saw increases in advanced practice providers versus those not acquired

https://www.medpagetoday.com/special-reports/features/102577

When it comes to workforce composition at physician practices, differences abound between those that had recently been acquired by private equity (PE) firms and those that had not, according to a study that used longitudinal clinician-level data linked to PE acquisitions.

Among dermatology, ophthalmology, and gastroenterology practice sites from 2014 to 2019, PE-acquired practices had higher clinician replacement ratios compared with their non-PE-acquired counterparts (1.75 vs 1.37), as well as significant annual increases in the number of advanced practice providers (APPs), reported Jane Zhu, MD, MPP, of Oregon Health & Science University in Portland, and colleagues in Health Affairsopens in a new tab or window.

This was also the case for each specialty on its own:

• Dermatology: 1.71 versus 1.28
• Gastroenterology: 2.18 versus 1.93
• Ophthalmology: 1.40 versus 0.98

Furthermore, entering physicians replaced exiting physicians at ratios of 1.50 and 1.14 in PE-acquired versus non-PE-acquired practices, respectively, and the replacement ratio for APPs was 2.51 in PE-acquired practices compared with 1.66 in non-PE-acquired practices, Zhu and team noted. This held true for both physicians and APPs across the specialties studied.

“Although these findings should be considered preliminary in nature, they raise important questions about the implications of PE ownership on the clinical workforce, particularly as PE investment accelerates across medical specialties,” the authors concluded.

Zhu told MedPage Today that “there may be both positives and negatives” when it comes to PE in the healthcare sector.

For instance, it is possible that hiring more APPs — such as physician assistants and nurse practitioners — might aid in expanding access to care to more patients, such as in cases when and where physicians are not readily available, she noted. But at the same time, it is possible that larger shifts in entrances and exits, and less longitudinal staffing may affect quality or continuity of care.

Overall, the topic “really does deserve further study,” Zhu said.

In addition, although the authors noted that they did not observe statistically significant changes for total physician counts, total counts of APPs per year increased at PE-acquired practices relative to non-PE-acquired practices (0.15, 95% CI 0.05-0.25, P=0.004).

At the individual clinician level, Zhu and colleagues found that the probability of both entering and exiting a practice was higher for physicians at PE-acquired practices compared with physicians at their non-PE-acquired counterparts. The estimated difference of entry for physicians was 15.74 percentage points (95% CI 10.79-20.69, P<0.001), and the estimated difference of exit was 6.0 percentage points (95% CI 1.91-10.07, P=0.004).

For APPs, the probability of entering was higher at PE-acquired practices compared with non-PE-acquired practices, but the difference was not statistically significant, the authors said. They further noted that they did not find evidence of differential probabilities of APPs exiting in PE-acquired practices compared with non-PE-acquired practices.

Replacement ratios were higher for younger physicians than for older physicians in both PE-acquired and non-PE-acquired practices: 1.70 vs 1.29 for physicians ages 40 to 60 and 0.50 vs 0.38 for those older than 60.

For this study, Zhu and colleagues examined a sample of 1,208 practice sites — including 691 in dermatology (1,735 clinicians), 166 in gastroenterology (741 clinicians), and 351 in ophthalmology (748 clinicians) — across the U.S. The PE sample included 422 dermatology clinicians at 112 practice sites, 259 gastroenterology clinicians at 45 practice sites, and 211 ophthalmology clinicians at 56 practice sites.

The authors combined several data sources to identify providers affiliated with PE-acquired versus non-PE-acquired practices, including Pitchbook (for mergers and acquisitions data), the IQVIA OneKey dataset (for individual provider-level and practice-level information), and the Medicare Physician and Other Practitioners dataset (to evaluate practice workforce turnover and composition over time.)

They then examined workforce change in three different ways. First they calculated clinician replacement ratios for PE-acquired versus non-PE-acquired practices. They also estimated whether practice-level entrants and exits differentially changed the total number of clinicians at PE-acquired practices versus non-PE-acquired practices. Finally they examined the probability of a clinician entering and exiting a PE-acquired practice versus a non-PE-acquired practice.

Zhu and colleagues noted that they may have missed some PE acquisitions, adding that it is also possible that there were some inaccuracies in how affiliations or clinicians were identified. Furthermore, the study did not estimate a causal effect of PE acquisition on workforce composition.

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