Physicians practicing in hospitals: implications for a medical staff policy.

President Clinton's health reform package included a proposal that would limit Medicare payments to the medical staffs of hospitals whose inpatient physician service volume was systematically above national norms. Under this policy, it would be possible for a physician practicing in more than one hospital to be penalized in one and not the other. Physicians might direct their admissions to certain hospitals to avoid penalties, and thereby would threaten the viability of some hospitals. However, to engage in large-scale admission shifting, physicians must practice in multiple hospitals. Using a national database, we find that, on average, physicians are affiliated with 1.56 hospitals and that 62% are affiliated with one hospital. On average, 90% of a physician's admissions are in a single hospital. We also find that, in the average hospital, a relatively small percentage of physicians (20%) admit a majority (60%) of Medicare patients. We discuss policy implications.