Providers caught in the crossfire in Pennsylvania management company transition

February 26, 2019

In a concerning turn of events in a hospital based physician service, Emergency Department coverage has been disrupted at three Pennsylvania hospitals and providers left without pay for months.  The situation, detailed in the Philadelphia Inquirer, relates to an emergency department management company which filed for bankruptcy, leading to an inability to pay malpractice premiums and an abrupt contract termination.  Providers were left without pay and another management company was brought in with offers of pay reductions of 20% for physicians and PA’s. This has led to significant provider turnover, dissatisfaction and a potential for legal action.  A labor attorney representing the providers offers the opinion that This is an unconscionable business practice. It’s inconceivable to me, particularly the sort of carrot-and-stick behavior on part of both Prime (the Health System) and Progressive (the new management firm),  

EHC NOTE: Physicians and mid-level providers instability in a contracted management company may rarely cause major disruption in the continuity and stability of the service line.  Anesthesia providers and OR/hospital leaders who are involved with an anesthesia management firm or are considering a new firm should evaluate the stability of the entity and look to the story above from Pennsylvania as a cautionary tale.