What are IDSs doing about poorly performing physician networks?

A national survey of 105 healthcare organizations conducted by Longshore & Simmons found that most IDSs' networks of acquired physician practices are losing money. The survey examined a variety of issues related to management and structure of IDS physician networks and physician compensation. In addition to finding that most networks were unprofitable, the survey found that for 75 percent of respondents, capitation revenue represented 25 percent or less of total revenue. The survey also disclosed there was no single, preferred method for allocating capitation revenue among physicians; 43 percent of physician networks were organized as hospital departments, cost centers, or divisions; and only 21 percent of respondents were using relative value units as a means to measure physician productivity, despite the proven effectiveness of this approach.