Return of the PHO?

A critical part of that strategy is the CIN, he says, because it provides the platform for independent and employed physicians to work together to develop a care management infrastructure. One potential difficulty is that the CIN is not a joint venture—it's owned entirely by IHS.

To make the organization more physician-driven and welcoming of independents, the board of directors delegates significant authority to an operating committee composed of independent and employed physicians and physician group leaders. Only two IHS executives, Kaplan and Kevin Vermeer, the system's chief financial officer, sit on that committee.

More than physicians
"Today's payment system doesn't support care management, but in the future, it will be demanded," says Kaplan. "We created our integrated care organization—which is more akin to an independent practice association than a PHO—around a platform that focuses on quality improvement, not contracting."

The ICO that IHS is developing will administer value-based contracts throughout the health system's network, but will not operate as a contracting entity for fee-for-service.

"What success looks like is improved quality, enhanced patient experiences, and lower overall healthcare costs," Kaplan says. The ACO that IHS is developing will include physicians in key leadership positions because "the physicians are the heartbeat of the ACO."

But in building an ACO, the infrastructure to create value often spans beyond the direct physician sphere to include IT-enabled clinical analytics, call centers, palliative care, home health, and skilled nursing.

Kaplan and others are busily putting these pieces together, which included hiring additional staff and reshuffling some internal talent.

"We didn't have trained people for care management," he says. "It's a lot of work to  build the right care management teams and develop their skills so we can build a network."

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