Competitive strategies for faculty practice plans in the 1990s

Area of Science:

• Health Services Research
• Healthcare Management
• Academic Medicine

Background:

• Faculty practices in academic centers have historically shown robust clinical revenue growth.
• Recent trends suggest a potential stagnation or decline in this revenue growth.
• The expansion of managed care plans presents a significant factor in the healthcare financial landscape.

Purpose of the Study:

• To investigate the hypothesis that the growth of managed care plans, specifically their Resource-Based Relative Value Scale (RBRVS) component, is negatively impacting clinical revenue in faculty practices.
• To analyze the financial trends of academic medical centers over the past decade in relation to managed care penetration.

Main Methods:

• Review of financial data from academic medical centers over a ten-year period.
• Analysis of the correlation between managed care plan growth and faculty practice clinical revenue.
• Examination of the impact of Resource-Based Relative Value Scale (RBRVS) adjustments within managed care contracts.

Main Results:

• Preliminary findings suggest a potential inverse relationship between the expansion of managed care and faculty practice revenue.
• The RBRVS component of managed care plans appears to be a significant factor influencing reimbursement rates.
• Academic centers may need to adapt financial strategies to mitigate potential revenue shortfalls.

Conclusions:

• The increasing prevalence and evolving reimbursement structures of managed care plans, particularly RBRVS, pose a potential threat to the financial sustainability of faculty practices in academic settings.
• Further research is warranted to fully elucidate the complex interplay between managed care, RBRVS, and academic medical center revenue.