Toward Physician Alignment

Michael Zeis, September 24, 2015

Healthcare leaders are developing clinical integration models to address clinical and financial transformation.

The healthcare industry is challenged by the need to transform both the clinical and financial aspects of care delivery. Among the challenges leaders are facing is that the financial foundation of the industry is heading toward a variety of risk-sharing payment mechanisms, but for most, fee-for-service reimbursement remains the source of a sizeable portion of revenue.

Healthcare leaders who responded to our Physician Alignment Survey indicate strong movement toward clinical integration, and expect to place increased emphasis on shared savings programs, bundled payments, and at-risk contracts as components of their physician alignment activity. Such shifts in alignment practices suggest that healthcare leaders are addressing how care delivery is becoming more collaborative. Executives are planning changes to their alignment practices because they see signs that those with integrated and aligned medical staffs will be rewarded.


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Parity among employed and independents

Maximizing financial performance is the item included most frequently as a business objective behind physician alignment strategies, cited by 61% of respondents. Nearly as many (60%) say that standardizing care for predictable costs is one of their top three objectives.

One would expect financial performance to be at or close to the top of a list of business objectives. And addressing cost is a principal contributor to financial success. But addressing cost through care standardization can be a great deal more challenging than more conventional methods of cost containment, because care standardization requires physician support, which, to an extent, requires that physicians surrender a degree of autonomy. Indeed, engaging physicians in care transformation is the third most frequently mentioned patient care objective, cited by 46%. And standardizing care for quality improvement, a conventional component of most healthcare quality improvement programs, is mentioned as a top patient care objective by 58%, nearly as many who mention standardization for cost savings.

Advisors indicate that objectives such as care transformation (included by 46%) and care coordination (40%) are liable to increase in priority over time. "The goal is to transform the care delivery system. So it was a little bit surprising that that number was that low," says Seth Kronenberg, MD, chief medical officer for 506-bed nonprofit Crouse Hospital and president and medical director for Crouse Medical Practice in Syracuse, New York, an organization that serves 23,000 inpatients and 150,000 outpatients in central and northern New York.

Michael Wiltermood, president and CEO for Enloe Medical Center, a 235-staffed-bed nonprofit hospital in Chico, California, adds, "If you include population health management with care coordination, you would see that number go up as we get better and better about working together." In fact, Wiltermood suggests that care coordination and care transformation are the major patient care drivers of physician alignment. "I think you could make the argument that those two together actually are the major objective and that the other things are subsets."

Michael Zeis

Michael Zeis is a research analyst for HealthLeaders Media.

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