The Corporate Transformation of Medical Specialty Care: The Exemplary Case of Neonatology

Abstract

The key to wealth in health care is the physician, who certifies to third-party payers that health care items and services are necessary for patient care. To compete more effectively for this wealth, physician specialists are organizing their practices into for-profit corporations and employing other physicians. Focusing on neonatology, this article describes the prevailing business model of these for-profit medical groups as controlling employed physicians through restrictive employment contract provisions, e.g., non-compete and mandatory arbitration clauses. With this business model and because of deficiencies in current law, for-profit medical groups eliminate competition from other physician specialists to the detriment of patients and consumers.