Management Services Organizations (MSOs) - Emerging Trends in Hospital/Physician Affiliations
Gallagher Healthcare :: Industry InsightsBy Dean Gereau | 10/1/2013
The landscape of healthcare practice structures continues to evolve and create new incarnations of medical service delivery models. An example of this evolution is the adaptation of physician clinical practices beyond the individual practice setting into the integrated and collaborative world of hospital ownership, large provider group absorption and Accountable Care Organizations etc. This consolidation trend towards a more broader based, top-down organization has resulted in an often frustrating loss of physician independence and control over their clinical practice. Management Services Organizations have gained prominence an organizational structure which solves some of these concerns by allowing physicians to maintain an element of independence while remaining competitive with larger corporate or hospital based provider groups.
MSOs generally exist in one of three forms:
- Administrative MSOs: Providing business services to individual and/or groups of physicians for a fee.
- Investment/Management MSOs: Own medical offices/buildings and/or medical equipment and supplies, leases these elements back to the operating physicians.
- Group Purchasing MSOs: Established primarily to achieve economies of scale when purchasing medical supplies, equipment leasing or billing services etc.
The practical implications of the continued growth of MSOs-supplemented physician practices is a model which allows individual or small physician practices to maintain their clinical independence while receiving the administrative and business Emerging Trends s operational support more commonly found in a large group or hospital based practice. Understanding the trade-offs essential to this collaborative model are essential to the evaluation of entering an MSO service agreement and should be considered carefully with a trusted advisor.