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May 9, 2004Munson cuts contracts with 10 of its doctors
Record-Eagle/Lara Neel Physician Andrew Scrogin is one of 10 doctors that Munson Medical Center is releasing from his contract. He will go into private practice on July 1. Most will try to build practicesByRecord-Eagle staff writer TRAVERSE CITY - Munson Medical Center and 10 affiliate physicians will sever contractual ties in July, a move some say could eventually create an exodus of much-needed area specialists. Dr. Andrew Scrogin, an endocrinologist who left a private practice in California in 1998 after being recruited by Munson, said he will attempt his own private practice once his contract expires, although it isn't something he wanted to do again. "Right now I am a salaried employee at Munson, but this practice will end on June 30 and July 1 I am starting my own brand-new business," he said. "I am going to try private practice and see what happens, but it has forced me to make changes that I didn't want to make." Barb Gordon-Kessel, a Munson Medical Center spokeswoman, said the Physicians Practice Network, which consists of approximately 22 physicians, including the 10 in "transition," is losing about $2 million a year. "We felt they would be able to survive as private practices and perhaps do better financially than by being employed by Munson," she said. Munson Healthcare President and CEO John Rockwood said the outgoing doctors were offered two severance options - one basic three-month package and a six-month option with conditions - in an attempt to keep them practicing in Traverse City. The physicians also had the option to continue under the system's umbrella, but at a salary that for some would amount to more than a 50-percent reduction. "In terms of the significant cut in pay, it is true that many of them would have taken a substantial pay cut unless productivity improved substantially," said Rockwood. "For many of them, that wasn't a possibility." But Scrogin said private practices like the one he'll attempt are at greater risk for failure. If he cannot make it work, there won't be an endocrinologist in the area to deal with the rising number of diabetic patients and other endocrine gland maladies. Scrogin said his Munson practice boomed in the last three years, but privately he will have to cut back on the number of patients he sees, the types of insurance he accepts and the services he can provide. "I hate to see patients shortchanged for health care services. I feel almost betrayed by Munson," he said. "I thought that what I shared with (Munson) was the desire to provide needed services to patients. "I am willing to stake my own financial security in private practice by at least trying to do it, which is a much greater gamble for me than Munson keeping me employed." Danielle Nagy, clinical team leader at Bay Area Family Care, said its six physicians decided to sever their contracts with Munson and take over ownership of the practice in July. "Our physicians are contracted (with Munson), but won't be in July," said Nagy. "We are not going out of business. It will be a seamless transition and same quality care always offered. The only change is that the doctors will be the new owners." Gordon-Kessel said seven primary care physicians - including the six from Bay Area Family Care and one from Elk Rapids - will join Scrogin and two neurologists in leaving Munson. Twelve physicians will remain, including specialists in infectious diseases, urgent care and occupational physicians, among others. "We are committed as a system to assure care is available and we need to be good stewards of the financial resources that we have," said Gordon-Kessel, who added that Munson had a net operating revenue of $9 million last year. But Scrogin said he doesn't understand how severing contracts with specialists will save Munson money in the long run or how keeping affiliates under the system's umbrella has become a losing proposition, considering the amount of expensive tests, treatments and referrals commonly associated with specialized care. "Munson is non-profit and is suppose to be providing health care to the region," said Scrogin. "Since the taxpayers are subsidizing the hospital, it should be held to a higher standard in retaining specialists. I feel strongly that this is an imminent health care issue."
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