🔒Healthcare consolidation means waning influence for medical societies

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EDITOR'S NOTE: This article has been updated with comments from the CEO of the Connecticut State Medical Society.

Connecticut's county and state medical societies are scrambling to recover from significant membership declines, largely caused by hospitals and large physician groups buying out private practices.

The big jolt to the 223-year-old Connecticut State Medical Society (CSMS) came in mid-July when administrators, who had been trying to hide the falloff, revealed to the board the 6,000-member group had lost 500 members over the last 12 months, said Dr. Henry Jacobs, incoming president of the CSMS and a private practice obstetrician-gynecologist in Bloomfield.

“This last year was disastrous,” Jacobs said. “All these hospitals are buying up practices and refusing to pay for doctors to join groups that might oppose them.”

Although the eventual disbanding of Connecticut's medical societies is possible, the main concern of physician leaders is doctors' waning influence on Connecticut legislation and regulation, weakening the voice of physicians in the healthcare industry and leaving hospitals and insurance companies to shape how medicine is practiced in the state. Although medical societies are trying to boost membership — or halt the slow decline — by educating doctors on the benefits, the main issue of consolidation among private practices shows no signs of slowing down.

“When doctors consolidate and join these hospitals and large groups, they mistakenly feel that the hospitals or the large groups are going to be the voice for them,” said Dr. Timothy Chartier, a Farmington private practice dermatologist, secretary of the CSMS, and past president of the Hartford County Medical Association. “The goals of the hospital are not always aligned with the goals of the doctors or even the goals of patients, I hate to say.”

The Connecticut Hospital Association declined to comment for this story.

Declining political capital

The medical societies' legislative influence already is slipping, Chartier said.

He points to one example in 2014, when the General Assembly voted to allow advanced practice registered nurses (APRNs) to set up their own medical offices. The move was favored by insurance companies because APRNs offer lower-cost alternatives to doctors, but the medical societies opposed it because APRNs don't go through as rigorous training to obtain their degrees.

“That is one time where we came up short,” Chartier said. “Now patients think they are seeing doctors when they are just seeing APRNs, which impacts the quality of care patients are getting across the state.”

Every member of a county medical society is a member of the state medical society, and vice versa, so the 6,000 CSMS members represent the totality of doctors in medical societies around the state. There are 10,000 certified doctors in Connecticut.

“If the memberships fall below critical levels … you can't go lobby at the State Capitol and say you have 1,000 members out of 10,000 doctors in the state,” Jacobs said. “No one is going to listen.”

While the CSMS lost 8 percent of its membership this year alone, the Hartford County Medical Association (HCMA) has seen an even worse decline, Chartier said. It has lost 43 percent of its members since 2007, and now has only 1,200 doctors within its ranks.

“All the county societies statewide have had a progressive drop in membership,” Chartier said.

Matthew Katz, CEO of CSMS, said he expects the statewide membership numbers to increase before the end of the society's fiscal year in September as more doctors could renew their memberships, although he said membership also could decline further. Katz said CSMS had has recent years where membership has increased, although the overall trend is downward.

While administrators of the New Haven County and Fairfield County medical associations declined to comment for this story, their nonprofit financial filings show they're losing money.

Both New Haven and Fairfield — along with Hartford — posted negative margins in 2013, the last year data was available, according to the 990 forms each filed with the U.S. Internal Revenue Service. Combined between the three associations, they lost $107,276 in 2013.

While factors like the rise in the cost of practicing medicine and a more disengaged next generation of doctors are contributing to the membership falloff, Chartier said the main culprit is private-practice consolidation.

The combined fee to join CSMS and a county medical society can cost between $700-$900 depending on the county, although the organizations do offer discounts. With that cost, Chartier said hospitals and large physician groups, which have faced tight margins of their own in recent years, are reluctant to outright buy memberships for all their doctors.

Some hospitals or large groups will provide doctors a stipend to join whatever industry associations they choose, Chartier said, but doctors have myriad options: They can join the state medical society, a national one, a city-based one, a group related to their specialty like cardiologists or simply pocket the cash.

Consolidation will also continue to be a major trend in health care, driven in part by the Affordable Care Act, which makes it more expensive for doctors to practice medicine on their own and puts more requirements on doctor's time, such as requiring the use of electronic medical records.

In October, Grove Hill Medical Centers and Connecticut Multispecialty Group announced they would merge to form the largest physician-owned medical practice in central Connecticut, with more than 250 doctors across 26 locations.

It's not just doctors that are joining larger organizations either, as hospitals and insurers are consolidating too. In July, the parent company of Lawrence + Memorial Hospital announced it would be joining the Yale New Haven Health System, while Bloomfield insurer Cigna announced it would be acquired by Indianapolis insurer Anthem in a $48 billion deal.

The growing power of hospitals, insurers and large doctors' groups will continue to erode medical societies' memberships, Jacobs said, because as the big companies make the healthcare industry more favorable to them, doctors in private practices will be time-constrained and under financial pressure to join up with larger organizations.

“It is a destructive cycle we are in,” Jacobs said.

Tapping reserves

The county and state medical societies each have significant endowments — built up from decades of selling products to their members — that could help them perpetuate their existence, even as membership dues decline. The CSMS had $2.2 million at the end of 2013 while Hartford had $1.1 million, Fairfield had $836,166 and New Haven had $485,816.

“The endowment funds could be raided, but with membership slipping away, that only delays the inevitable,” Jacobs said. “I hate to see it all go down the tubes. Everyone was shocked when they saw the membership numbers this year.”

To combat their declining ranks, county and state medical societies are focused on educating doctors on membership benefits. The societies also are listening to non-member doctors' needs, so the organizations can better accommodate physicians, Chartier said.

“Unless we get together and speak with a unified voice — a strong voice — then we are going to lose our ability to influence how medicine is practiced in Connecticut,” Chartier said. “That is going to have a snowball effect on physicians because they think they will have to consolidate, which will lead to them dropping out of the medical society.”

CORRECTION: A previous version of this story said the cost to join Connecticut's medical societies is $1,000 when the combined cost to join the Connecticut State Medical Society and the doctor's respective county medical society is $700-$990, depending on the county.