Doctors Health System and Montgomery County Network agreed yesterday to band together to create one of the largest doctor-controlled health systems in the state, with more than 250 primary-care physicians.
Under the 15-year agreement, the two organizations will not merge.
Instead, Montgomery County Network will grant Owings Mills-based Doctors Health the exclusive right to negotiate service contracts with insurers, hospitals and managed-care companies for its primary-care physicians, said Dr. Scott Rifkin, founder of Doctors Health.
A similar agreement
Doctors Health said it also had struck a similar agreement with an eight-member physicians group in Western Maryland, the Cumberland Valley Medical Group.
The move is further evidence of the fast-paced consolidation of physician practices regionally and nationwide, said health care experts. It also underscores that primary-care physicians are starting to gain clout with managed-care companies as such companies increasingly come under state mandates to have available a high percentage of "gatekeepers" -- the primary-care physicians who direct patients' care, noted Dr. Jonathan Weiner, professor of health policy and management at Johns Hopkins School of Public Health.
"This is part of very powerful trends in health care today," said Dr. Weiner. "Not the least of those is a growing unease among some physicians in dealing with the for-profit health ventures."
But it is also true, he noted, that such large alliances as the one announced yesterday offer a competitive advantage in a market flooded with physicians.
The concentrations of doctors in the Baltimore region and in Montgomery County are among the highest in the country, Dr. Weiner noted, making competition for managed-care contracts fierce.
By banding together and creating a statewide system of doctors, the two groups gain an advantage in negotiating contracts with insurers, hospitals and managed-care companies to provide physician services.
Montgomery County Network has 153 primary-care physicians; Doctors Health has 103 primary-care physician members in the Baltimore region.
Doctors Health does not have the exclusive right to negotiate rTC insurance and other service contracts for the more than 600 specialists in the two groups.
The physicians in Montgomery County Network, based in Rockville, also gain access to Doctors Health's information system and protocols for managing patient care.
Patients are affected
Dr. Rifkin said the greater clout the alliance will have in negotiating insurance contracts should give its physicians more freedom to make decisions for their patients.
"Your local doctor, not someone at a desk out in Iowa, will have control over medical decisions," said Dr. Rifkin, referring to how some national health care companies have centralized some of the decision-making.