Physician Organization, Not Consolidation, Key to Success

September 19, 2013

Enterprise-level management and transforming physicians into clinical managers represents a pivotal advance in ACO and IPA models.

Only about 15 percent of commercial payer-provider agreements contain shared savings or risk-assumption elements, and most limit the upside savings to providers.

The reason is not because payers want things both ways, reduced spend and all of the upside. Rather, it's because physicians have not had access to, or been willing to invest in, the proper tools and training that would equip them to become real financial partners with insurers, self-insured groups, and, soon, healthcare exchange insurers who need to control spending to compete and survive.

While the federal government keeps the public focused on the cost of insurance, it and the private insurers are becoming more and more focused on the cost of healthcare. Subsidizing insurance premiums to expand the ranks of insured is no global solution, short- or long-term, only an intermediate step in the right direction. Controlling prices is also no solution because it only shifts the shortfall from one financially responsible group to another. Controlling prices globally without introducing efficiencies will do little more than starve the system.

In our fragmented system, the key to success is not consolidation but organization. Care coordination is a popular tactic with ACOs and IPAs, but it is typically limited to a case-by-case application and performed in a vacuum.

Extracting actionable information from EHR databases and including the communication technology to keep each patient’s caregivers on the same clinical page can transform physicians from service providers to clinical managers with the time to focus on the most complex cases. Expanding that capability to manage disease-stratified silos in narrow networks that are consolidated into medical neighborhoods and, eventually, into regional networks managed on an enterprise basis, introduces population management that can consolidate savings and improved outcomes into meaningful improvement.

This, however, is not a software-only solution. Maximizing the rewards requires investment in and commitment to an organization, training, continuing education and improvement.

Upstart Osler Health IPA, for example, is fully invested in its concept of practice transformation into independent clinical households that are an integral and integrated part of a larger neighborhood, which in turn is organized into a metropolis of neighborhoods all working toward a common goal and mutual benefit, uniquely equipped and prepared to thrive in a risk environment.

Is it the future? Maybe. Plenty of experts are predicting that payers, particularly CMS, will have accumulated enough power over healthcare by 2015 under the Affordable Care Act to mold it into an image that suits them best. Private insurers are already acquiring hospitals, group physician practices, and allied health care providers aggressively. CMS is picking winners and losers with its checkbook and most providers, particularly physicians, are selling out, seeking employment or ignoring the warning signs.

The one thing that is missing from all of these equations, and the reason they are consistently failing to deliver any meaningful results let alone functioning well enough to benefit from shared savings or risk, is that common ownership does not imbue common purpose.

No software, no matter how sophisticated or clever or comprehensive, can deliver solid results without skilled users, a participating network, and compatible practice operations with everyone on, and reading, the right clinical pages.

Whether you lead or follow, or are independent or employed, participation in a broader network that provides the tools and training to make a difference will make all of the difference in your future.