Physician Practice Management: The Doctor is In

Through the late 1970s and early 1980s, physicians seemed to occupy a protected position in the Federal battle against rising health care costs. Despite the central role they play in determining how and where health care is delivered, governmental cost containment efforts, starting under the Carter Administration, focused largely on hospitals, in part because the vast majority of health care resources are consumed there (wherever the decision-making ultimately lay). Indeed, the Government's major initiative, prospective payment based on diagnosis related groups (DRGs), specifically excluded the physician cost component from the reimbursement level.

Even where the role of physicians was acknowledged, hospitals and other players, such as payers, often seemed reluctant to challenge...