Five of the six anesthesiologists serving Haywood Regional Medical Center resigned en masse last month. Earlier in the year, the hospital lost all of its general orthopedists: two left, a third took early retirement, and the fourth became a spine-only specialist.

The overwhelming reason cited by most of the physicians for their departures was an uncooperative hospital administration. Hospital administrators and board members, however, said they did all they could to keep the doctors, but ultimately couldn’t make concessions for individual doctors that would compromise the long-term goals of the hospital.

While the hospital has brought in new anesthesiologists from Asheville and is recruiting new orthopedists — supplemented in the meantime by rotating out-of-town doctors — the departures underscore the sometimes tenuous relationship between doctors and hospitals. Doctors need the hospital for its operating rooms, high-tech equipment and beds. In exchange, the doctors bring in the patients, who rack up hospital bills from X-rays to overnight stays.

The mutually beneficial relationship can be volatile, however. Disputes between doctors and the administration at Haywood Regional in the past year have ranged from the choice of software to track patient data, the layout of the new emergency room, the number of nights that constitute a reasonable on-call schedule, priority for new equipment purchases, and what new medical specialties to recruit.

Juggling the wish lists and suggestions of 120 independent minded doctors who come and go in the hospital’s hallways is not easy. A hospital that kowtows to every physician’s request could soon be in debt.

Eileen Lipham, vice president of professional services and the hospital’s front line in doctor relations, said the administration is very receptive to doctors.

“We have a very symbiotic relationship with our medical staff,” Lipham said. “I think we do everything we can do to find a win-win situation with every physician on this staff.”

But some doctors said the immediate replacement of the outgoing anesthesiologists makes the medical community feel like a dispensable commodity.

Chain reaction

When Chuck Trenthem left Utah and came to Haywood Regional as an anesthesiologist two years ago, his gross income dropped from $300,000 to $175,000. But he gladly traded the income for quality of life, to live in a place where he could go kayaking on his days off. The other five anesthesiologists who were recruited to Haywood County between 2002 and 2003 have similar stories, forgoing high-paying positions at urban hospitals to live in Western North Carolina.

Then, in late spring 2004, a bombshell went off in the local medical community. In a matter of three months, the orthopedist industry in Haywood County collapsed from four practicing general orthopedists to none. Patients with basic broken arms and those needing high-dollar hip replacements had to be sent out of the county. The resulting drop in patients caused the hospital to temporarily shut down a floor and send nurses home on paid leave days — and was the catalyst for the anesthesiologists’ departure months later.

“When essentially all the orthopedists left, the surgical case volume plummeted. Our incomes had dropped very, very substantially,” said Mark Brown, an anesthesiologist now working elsewhere. “It was a question of ‘can any of us make a living here?’ Almost all of us said, ‘we can’t make a living here.’”

Known as the cash cow of the hospital, orthopedists are responsible for an estimated 25 to 40 percent of the work that flows through the hospital. One broken hip triggers everything from X-rays to MRIs and is often followed by a lengthy hospital stay and physical therapy.

The anesthesiologists saw more than a 30-percent decline in their workload, and an even larger decline in their salaries. The orthopedic surgeries, many of them elective like arthroscopic knee surgery, have a higher ratio of well-insured, paying patients than emergency procedures like bypass operations.

The anesthesiologists, who typically bill patients directly and get no money from the hospital, asked the hospital to supplement their income until more orthopedists were recruited.

The hospital agreed to give the six anesthesiologists a supplement of $21,000 a month to split among themselves. This amount was far less than the anesthesiologists asked for and did not make up for the lack of orthopedic surgery. But after two months of negotiations, the anesthesiologists accepted the offer as a gesture of good faith. They signed a month-to-month contract with the hospital in September.

‘The final straw’

Upon signing the contract, the anesthesiologists said the hospital remitted two months of supplements to cover August and September, as was called for in the agreement. When October rolled around, the anesthesiologists expected their next supplement but didn’t receive it.

A dispute erupted over the language in the contract. The hospital claimed, according to the anesthesiologists, that the supplements weren’t due until the end of the month. The doctors said they were told by Eileen Lipham, the vice president of professional services, that they would receive October’s supplement on Nov. 1.

So the anesthesiologists waited. Nov. 1 came and went without a check, so on Nov. 2, five of the six anesthesiologists turned in their 30-day notice.

“That was the final straw,” said Melita Ritter, an anesthesiologist who is now practicing elsewhere. Ritter and other anesthesiologists said they suspected the hospital was stringing them along while looking for another group of anesthesiologists behind their back.

“We didn’t think they were negotiating in good faith,” Ritter said. When the hospital administration immediately filled the void with the Asheville Anesthesiology group, it seemed to confirm the anesthesiologists’ suspicions.

But Rice said that the prompt arrangement with Asheville Anesthesiology was an example of good contingency planning.

“If we didn’t look ahead on this, we could very well have had the entire surgery department shut down. Any good CEO will have back-up plans for any service,” Rice said.

Rice said the hospital did not want to lose the anesthesiologists.

“It’s earth shaking when a group of physicians gives notice,” Rice said. But the hospital’s quick response “sends a message that we’re not going to have service interrupted.”

That message has disturbed some other doctors across several specialties, however.

One doctor said he previously viewed hospital administration as open and receptive, but is now apprehensive.

“It raises concerns and doubts in my mind and in others that if we had a major concern, or were asking for something that crossed a line, they would go look for another group to bring them in,” said the doctor, who requested not to be named.

“The attitude seems to be ‘OK these guys are quitting. Let’s find someone else.’ The issue of why they are leaving isn’t being addressed,” said another doctor in a different specialty who also spoke on the condition of anonymity.

Rice said the administration has to keep the big picture in mind.

“I’d rather suffer for a while and do it right than get in a situation a year from now that’s no different than where we were,” Rice said, adding that aspects of certain personnel scenarios are not known by the general medical community.

The group plan

Hospital administration and the anesthesiologists have been less then enamored with one another for more than a year leading up to the departure.

Each anesthesiologist was individually recruited and operated as a lone practice. The hospital administration, looking to streamline and standardize management of the anesthesiology department, wanted them to form a group practice.

“The trend is to get them into a collective group so a contract can be issued that would spell out the procedures and terms that would be covered in this hospital,” Rice said. “I wanted consistent service.”

There are six medical fields that operate solely in the hospital: radiologists, anesthesiologists, ER doctors, hospitalists, Urgent Care doctors and pathologists. These six fields — each akin to its own mini-union — are crucial to the hospital operations and have significant leverage if they threaten to walk off the job. Without pathologists, no lab work can be done. Without radiologists, no X-rays can be taken.

Haywood Regional had group contracts with all these hospital-based fields except anesthesiology.

After months of nudging the anesthesiologists to form a group practice, the hospital demanded it. On two occasions, the anesthesiologists were told to come to a hospital board meeting where the hospital board quizzed them on why they hadn’t formed group practice yet.

“It was like merging six companies. They didn’t understand why it couldn’t happen overnight. They didn’t seem to understand,” said Melita Ritter, one of the anesthesiologists.

Mark Brown, another anesthesiologist, said it is uncommon for a physician to be hauled into the hospital board.

“It’s like going to the principal’s office,” Brown said.

Hospital board member Bob Browning said he told the anesthesiologists at the board meeting that they needed a “character adjustment.”

“They never were satisfied it seemed to me,” Browning said. “They wanted to hold the hospital hostage.” The anesthesiologists had been a problem since day one, he said, and were prone to gripes and demands. A contract was intended to fix that problem.

“That way we wouldn’t have to listen to but one person,” Browning said.

Hospital board members said they asked the anesthesiologists for a group practice on the recommendation of Rice and Lipham.

“It was a recommendation by administration so they could manage the group and manage them within the hospital configuration,” said Glen White, hospital board member. “When it comes to scheduling and all those kinds of things, it’s a way that makes things run more smoothly.”

The anesthesiologists, however, said it was an attempt by the hospital to exert control over doctors.

It took the anesthesiologists upwards of a year to form the group practice, which required formulating a legal and financial corporate structure with six equal shares that included a mutual retirement plan, mutual billing arrangements and overhead.

“What the hospital was asking these guys to do is: they were all independent business people, and they wanted them to all be partners,” said Lynn Sylvester, a Waynesville accountant hired by the anesthesiologists to structure their practice.

Rice said the anesthesiologists understood when they were recruited that the hospital wanted them to form a group.

Dividing lines

When the anesthesiologists resigned, hospital administration and board members partially attributed it to the lingering dispute over forming a group practice.

“It wasn’t only the amount of money, but they felt they couldn’t pull the group together,” Rice said. “The anesthesiologists clinically were very good, but they just didn’t have the leadership they needed to pull the group together.”

The anesthesiologists disagreed. It cost them $30,000 to form the group only to dissolve it five months later, an exercise and expense they would have avoided if they weren’t planning to stick around, they said.

“I think all of us would still be there if there were still a busy orthopedist service,” Brown said.

Some doctors reported that hospital administration, in an attempt to explain the anesthesiologists’ departure to the rest of the medical staff, called the anesthesiologists “greedy.”

But Sylvester, the group’s accountant who aided in contract negotiations, said the anesthesiologists were not money driven.

“If they were willing to come here in the first place, it shows they weren’t greedy,” said Sylvester. “Anesthesiologists are one of the highest demanding specialties in the country. They can go anywhere right now a work for about $10,000 a week.”

On top of the nationwide shortage in anesthesia, it is historically one of the most mobile medical professions. They don’t have to build up their own patient base, but rather serve patients brought into the hospital by other doctors.

“This hospital administration was not very savvy on what was available in neighboring areas for us to go to,” said Melita Ritter, one of the anesthesiologists who is now heading for the hospital in Elkin, N.C., a town of 4,000.

Glen White, a hospital board member, said that the salary cuts taken by the anesthesiologists to come to Haywood Regional were negligible given the lower cost of living here.

Some doctors were not sympathetic to the anesthesiologists’ situation. One family practice physician said he has had consistently declining revenue over the past five years. Medicare and Medicaid are paying less of patient’s full medical bill and more patients are uninsured. Meanwhile, malpractice insurance and overhead have gone up.

While the radiologists, nurses and others saw a slump in work without any orthopedists on board, they did not demand supplements to tide them over.

“Everybody in this organization, everybody, was impacted by the loss of orthopedics,” Lipham said.