The health care economist John Goodman explains one more incentive for the private practice doctor to become an employee of a hospital or some other vertically integrated health care corporation and for the vector that is pointing in the direction of increased health care costs.
Differential price controls benefit some and harm others. See here for how much more CMS pays for the same procedure based on where it is provided.Wonder which group has the more effective rent seeking mechanisms-hospitals or private practice physicians.
In regard to the differential payments,Cui bono.Obviously the hospitals- but why would CMS adopt that tactic? I suggest it is in the interest of all third party payers not just CMS to eliminate the private practice of medicine by thousands of small, individual physician practices.If the goal is control of how physicians practice medicine, then to nudge them to become employees of a medical collective would appear to be a good tactic.
More on the movement away from small medical practices to hospitals can be found here in the discussion on the effect of ACA (Bronco care) on that issue.