Private equity firms have increasingly bought up doctors’ practices that contract with hospitals to staff emergency rooms and other departments. These staffing companies say the coronavirus pandemic is, counterintuitively, bad for business because most everyone who isn’t critically ill with COVID-19 is avoiding the ER. The companies have responded with pay cuts, reduced hours and furloughs for doctors.
One Envision anesthesiologist in the mid-Atlantic region said his base salary was cut by 30% even as he’s being asked to intubate COVID-19 patients — a procedure that puts providers at high risk of exposure to the virus.
Envision, which has 27,000 clinicians, said it’s cutting doctors’ pay in areas that are seeing fewer patients. The company will impose pay cuts or furloughs for non-clinical employees.
“Where they lose their normal billing revenue, medical groups are losing money. Where medical groups are losing money, they have to reduce salaries and furlough workers,” Envision CEO Jim Rechtin said in a statement. “Unfortunately, we are no different.”
Before the pandemic, Envision made a lucrative business out of buying practice groups in specialties where patients don’t choose their provider, such as ER physicians and anesthesiologists, according to Dr. Marty Makary, a surgical oncologist at Johns Hopkins Medicine who studies health care costs. Envision could then charge patients high prices for out-of-network care, a practice known as “surprise billing.”
“Private equity consolidated large physician groups in an unprecedented financial gamble using capital and banking on revenue not skipping a beat,” Makary said. “When the investment model works, investors get rich. When the investment goes sour, who bears the risk? As in the mortgage crisis of 2008, taxpayers are bearing the risk of financial gambles of investors.”
Katy Talento, a health adviser to President Donald Trump from 2017 to 2019, offered a different view. “If they’re private equity-owned, I have no sympathy, and I don’t think any patient out there struggling paycheck to paycheck — if they have a paycheck — is remotely interested in the crocodile tears of private equity firms and their revenue losses...”
“My hope in any type of bailout going toward health care providers is it should go to them,” said the anesthesiologist, who spoke on the condition of anonymity for fear of losing his job. “It should not be going toward rewarding executives or shareholder profits. Anybody actually coming in physical contact is taking all the risk, so that’s where the relief should be going.”
One Envision anesthesiologist in the mid-Atlantic region said his base salary was cut by 30% even as he’s being asked to intubate COVID-19 patients — a procedure that puts providers at high risk of exposure to the virus.
Envision, which has 27,000 clinicians, said it’s cutting doctors’ pay in areas that are seeing fewer patients. The company will impose pay cuts or furloughs for non-clinical employees.
“Where they lose their normal billing revenue, medical groups are losing money. Where medical groups are losing money, they have to reduce salaries and furlough workers,” Envision CEO Jim Rechtin said in a statement. “Unfortunately, we are no different.”
Before the pandemic, Envision made a lucrative business out of buying practice groups in specialties where patients don’t choose their provider, such as ER physicians and anesthesiologists, according to Dr. Marty Makary, a surgical oncologist at Johns Hopkins Medicine who studies health care costs. Envision could then charge patients high prices for out-of-network care, a practice known as “surprise billing.”
“Private equity consolidated large physician groups in an unprecedented financial gamble using capital and banking on revenue not skipping a beat,” Makary said. “When the investment model works, investors get rich. When the investment goes sour, who bears the risk? As in the mortgage crisis of 2008, taxpayers are bearing the risk of financial gambles of investors.”
Katy Talento, a health adviser to President Donald Trump from 2017 to 2019, offered a different view. “If they’re private equity-owned, I have no sympathy, and I don’t think any patient out there struggling paycheck to paycheck — if they have a paycheck — is remotely interested in the crocodile tears of private equity firms and their revenue losses...”
“My hope in any type of bailout going toward health care providers is it should go to them,” said the anesthesiologist, who spoke on the condition of anonymity for fear of losing his job. “It should not be going toward rewarding executives or shareholder profits. Anybody actually coming in physical contact is taking all the risk, so that’s where the relief should be going.”
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