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What Does the Future Hold for Academic Medicine in a World of Health System Mergers and Acquisitions?

Darrell G. Kirch, MD , President Emeritus
September 27, 2016

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Darrell G. Kirch, MD
Darrell G. Kirch, MD

Spring finally arrived in Washington, and for the AAMC, that meant not only cherry blossoms and warmer weather, but also the opportunity for us to gather with our constituents at our various affinity group spring meetings. In March, I attended the Council of Deans and Council of Teaching Hospitals and Health Systems combined meeting, where we discussed the dramatic transformation occurring at our medical schools and teaching hospitals and the implications for the future of academic medicine.

Among the most dramatic changes in our landscape are the new partnerships emerging between institutions across the country, often in response to or in preparation for the financial and governance pressures facing medical education, health care delivery, and medical research. From alliances to joint ventures to acquisitions to full mergers, academic health systems are establishing a broad regional presence and aligning clinical services across the continuum of care.

While collaborations and mergers may be the biggest and most apparent changes, efforts are under way to transform the way we provide clinical care at every level of our health systems to increase efficiency, enhance transparency, and improve patient outcomes. The push to find alternatives to fee-for-service payments has led to new models—including bundled payments and accountable care organizations—that are helping us rethink and redesign the continuum of care to achieve better community health outcomes. Physicians and hospitals are experimenting with the use of technology not only to care for more patients, but also to improve the referral process for specialists and enhance communication between primary and specialty care providers.

These changes inevitably lead to growing pains at all levels of an organization. New partnerships present challenges not only in aligning the governance, organization, and management systems of complex institutions, but also in the difficult tasks of integrating cultures, values, and missions. For health care providers, administrators, and educators, it can be challenging to keep up with changing care delivery and payment models and to learn and teach technology that will continue to evolve. Although many of these changes are driven by economic forces, medical educators face the special challenge of maintaining strong clinical learning environments to prepare the next generation of physicians to acquire the competencies needed to keep up with ongoing changes in medicine and practice.

But as difficult as these changes can be, they are essential to ensuring long-term sustainability. In addition to improving efficiency, lowering cost, and creating more nimble organizations, transforming our health systems provides an opportunity for our institutions to play a deeper role in advancing community and population health. The transformation of our landscape also allows us to embrace practice models that emphasize patient-centered care and create true medical homes for patients. And by advancing value-based payment models and using technology to provide remote care, these changes are helping bridge the gap in access. Since implementation of the Affordable Care Act, AAMC data have shown that although the number of health care consumers who did not access medical care because of cost is shrinking, the number of consumers who did not access medical care because they could not find a provider is growing. This is a serious problem, exacerbated by a nationwide physician shortage that is expected to reach between 61,700 and 94,700 by 2025, according to our most recent workforce shortage analysis. While we cannot increase the overall supply of physicians without lifting congressional caps on funding for residency training, we can begin to tackle the problem through population health management and improving access to care in areas of the country where the physician shortage is most severe.

“While the rapid changes to our organizations can feel jarring, increased collaboration and partnerships are generating new energy to identify and advance more efficient and effective models for care, education, and research.”

Our challenge is to ensure thriving and sustainable health systems that can guarantee ongoing, robust support to our missions of education, research, and clinical care. The AAMC is helping our members achieve this goal through workshops, webinars, and resources that will help our institutions better communicate the value of their services and determine out-of-pocket costs for patients. An AAMC health care advisory panel is also focusing on the challenges and opportunities related to mergers and acquisitions and their effect on the academic missions. The panel is expected to issue its recommendations this fall.

The discussion with the deans and CEOs was at times sobering, yet I came away more optimistic than ever about academic medicine’s ability not only to weather these changes, but to lead the emergence of new models for medical education, research, and patient care. Tomorrow’s health care system will be one of value-based reimbursement, advanced technology, and large, complex integration. Medical education will require an emphasis on developing competencies that will help the next generation of physicians practice effectively amid the acceleration of medical and scientific knowledge. And we will need to strengthen our support for the entire spectrum of medical research to achieve our goal of better care for individuals, better health for populations, and a reduction in per capita health costs. While the rapid changes to our organizations can feel jarring, increased collaboration and partnerships are generating new energy to identify and advance more efficient and effective models for care, education, and research. Health care providers, educators, and leaders are drawn to academic medicine because of their skills at solving problems. We face major challenges, but I am confident that we have the people and the partnerships to solve them.

This commentary originally appeared in print in the May/June 2016 issue of the AAMC Reporter.

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