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William F. Jessee Talks Physician-Hospital Alignment

Joe Cantlupe, for HealthLeaders Media, January 12, 2012

After being president and CEO of the Medical Group Management Association for 12 years, William F. Jessee, MD, FACMPE stepped down last October, which gives him the chance to spend more time examining the landscape of physician and hospital integration.

From his vantage point it's a rocky landscape.

Few hospitals and physicians are yet up to the challenge of properly aligning themselves, even though the pace of hospitals acquiring physician practices is accelerating across the nation, Jessee tells HealthLeaders Media.

Since leaving MGMA, Jessee has been senior vice president and senior advisor for Integrated Health Strategies, of Minneapolis, a consulting firm for physicians and hospitals with alignment and performance issues.

Discussions with hospital clients are showing that too many "don't have organizational goals or strategies for their physician practices. Hospitals simply bring in (physician) practices because they are out there," Jessee says. After a contract is signed, he adds, "now they are trying to figure out: what do I do next?"

It's not only hospitals stumbling in alignment strategies, Jessee says. Many physicians expect large payments, but they should lower their expectations of hospital employment and not be "greedy" when it comes to anticipated incomes, he adds.

"I think what the doc must to do is to step back from the prospect of short-term economic gain and ask themselves, 'how can I do a deal with the hospital that is a win, win for both of us?'' Jessee says. "If they are both happy with the deal, they are more likely to have a lasting relationship than if a (doc) felt after a deal was made, 'Boy, did I really sucker the hospital administration.'"

Jessee discussed some of his best-of-alignment ideas in an interview:

1. Hospital CEOs should ask: Why do you want this physician?

Too often, hospital systems are merely bringing physicians on board for employment because they believe competing systems are courting them. Too often hospitals haven't done the necessary homework to do a good job, says Jessee. In seeking physicians, he says, hospital CEOs often are standing alone and not soliciting  input from their management or physician leadership, or doing enough analysis of fiscal returns, or raising other potential deal-breaker issues.

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