Snapshot

Clinically integrated networks represent the next leap forward in patient care. Each organization will face unique hurdles in building its network, but the lengthy, delicate work pays off in better patient care.

Whether the goal is getting a handle on population health, taking on risk-based contracts or improving the patient care experience, hospital leaders and physicians are separately learning the same tough lesson: they can’t do it alone.

Collaborating on the delivery of care through clinical integration is the solution, but it’s not a quick or easy process. In fact, it’s a challenging mix of clinical, financial, interpersonal and regulatory elements among physicians and hospitals, which, when united into a network, are meant to improve the patient experience. And, according to integration experts, it begins with embracing the need for transformation.

“The very first place it has to start is provider participation and leadership,” says Deb Smith, R.N., who led the team that developed clinically integrated network standards for URAC, the accreditation organization. “This is a bottom-up structure, and so it is critical that practicing physicians, other clinicians, hospitals — however the community sees itself — come together [to say], ‘The old model does not work anymore, it’s not sustainable,’ and be willing to make sometimes uncomfortable changes for a network to emerge that is solid enough to attract payers, sound enough to integrate both financially and clinically.”

To illustrate success factors and barriers on the route to achieving CIN status, Trustee homed in on three organizations with widely different starting points and a variety of obstacles to resolve: St. Vincent’s Health Partners, Bridgeport, Conn.; Reading (Pa.) Health Partners; and Sharp Community Medical Group, San Diego.

Moving Forward Legally

The need to succeed at managing populations instead of individual patients — prompted by incentives in the Affordable Care Act and echoed by commercial payers — has lit a fire under efforts to pull providers together to pursue integration. But network standards and performance targets mean CIN initiatives sometimes can struggle. And independent physicians and other providers who need to unite around contract terms can raise antitrust issues that need to be considered carefully.

Clinical integration links all or most of the health care components a patient might encounter: physician practices for primary and specialty care, hospitals for acute or chronic conditions that erupt, and post-acute care for conditions of aging or recovery from illness. Independent physicians can be a key component. If these doctors are not brought into a close relationship with the others, the network’s improvement aims may not be possible.

And physician buy-in isn’t always easy. After spending considerable time developing their practices, “they’re risk-averse and they’re cautious, and they want to see demonstrable value,” says Thomas Enders, a senior managing director of Manatt Health Solutions.

The way to build a durable CIN, says Smith, is “by forming a venture that benefits consumers in three important ways: quality of care, utilization of resources and cost-efficiency.” These benefits have to be demonstrated through data, and that means a capability to monitor, collect, analyze and report how the CIN is doing in these areas, and how the network is making that happen by adhering to clinical and administrative protocols and meeting performance targets.

“The way we have all done it for the past 50 years is not the way we’re going to do it tomorrow,” she says. “Not if we want to be successful.”

Physicians Are Central

Messages of clinical impact and sustainability in a world of shrinking health care reimbursement can win the day. CINs produce performance data, and reviewing a doctor’s current work against consensus best practices in a nonjudgmental way can engender real understanding and appreciation for what the CIN is aiming to accomplish, says Enders. “I find that clinicians really respond, particularly when one is recruiting the kind of clinicians who are progressive in a community.”

One factor in populating the CIN with clinicians is careful selection of leaders to do the recruiting, he says. “It’s a really important choice, and not always obvious, because that person has to be well-respected and trusted by the hospital, and well-respected and trusted by the physicians in the community.” Compensating the leader to spend half his or her time developing the network also is critical.

Lack of trust can spawn all sorts of suspicions and misunderstanding. The recruitment of community physicians to Reading Health Partners, the CIN initiated by Reading Health System, took six months instead of the three to four weeks that its management had anticipated. “The initial resistance was that this was a ploy of the hospital to give it more control over the independent physicians,” says George Jenckes III, M.D., appointed CEO of the CIN.

The reactions turned up a long-standing wariness in the physician community about Reading’s motives, which predated a complete C-suite turnover about three years ago to modernize the health system, says Jenckes, medical director since 2007 and a practicing physician there since 1986. “We didn’t realize the history of how long the mistrust had existed between the hospital and the independent physicians.”

There was no one to represent physician interests, he adds. When the new administration took over, “there were no physician leaders in the bullpen. None had gone for advanced degrees; it was a concept that was totally lacking in the organization.”

Patiently explaining the alternative — getting left behind in the health care march to value-based business — is a difficult but necessary responsibility. “You offer them the opportunity to survive,” says Smith. “You offer them the opportunity to contract favorably as part of a group. And you offer them the opportunity to do that in a network that is provider-led.”

For the Sharp Community physicians, the prospect of losing patients to other organizations such as Kaiser Permanente overcame resistance to change. “Physicians don’t make changes until they’re pinned against the wall and it’s getting uncomfortable,” says John Jenrette, M.D., CEO of the CIN founded in 1989. “They knew they needed to come together collectively, and to manage patients and to take financial risk.”

St. Vincent’s Journey

A poster example of wielding both opportunity and responsibility is the St. Vincent’s approach, URAC’s first accredited CIN. It took a physician-hospital exploratory board 18 months to determine a population-health structure and another 12 months on design issues and process implementation, says Thomas Raskauskas, M.D., CEO of St. Vincent’s Health Partners. An extensive data reporting and feedback loop has helped to improve results and winnow the skeptics, says Smith of URAC.

“Doctors don’t like to be interfered with — questioning their judgment, trying to get them to do something other than what they thought of — but they do like feedback,” Smith says.

The data pulled electronically from physician practice claims are run through analytics and the results presented to each physician and practice once a month for discussion, sometimes more frequently for those who need it, says Colleen Swedberg, R.N., director for care coordination and integration. “What we do for one practice may be either more or less than [what we do for] a different practice. It all depends on the capabilities of that doctor, the staff and the infrastructure that they have.” The formal meetings also give managers a chance to gauge how the clinician is taking to the CIN requirements generally.

The data-driven approach wasn’t a hit right away. But, ultimately, it helps practices to be as efficient as possible using information presented in a nonthreatening way. Once over that hump, she says, “the feedback we’ve been getting is, ‘How did the practice ever get along without this information?’ ”

Starting in January, the CIN will post all data “unblinded,” which means that every doctor and practice can see the record of everyone else, says Raskauskas. The transparency of performance metrics will help to “build some competition among the docs on who’s doing the best practice,” he says.

St. Vincent’s may be on its way to substantive clinical improvement, but antitrust allegations in the mid-1990s against a Danbury physician-hospital organization for antitrust violations still hung over health care in the state when the idea of a population health management organization first emerged, says Raskauskas. “The environment in Connecticut was one of extreme caution over how we move forward without being in violation with the Federal Trade Commission.” In talks with experts at both URAC and the FTC, Raskauskas says he was able to ensure clinical integration that follows the rules.

To streamline the CIN formation process, all doctors who had a fee-for-service contract with a payer kept that same relationship, and St. Vincent’s “overlaid clinical care coordination fees and quality and shared-savings formulae,” he says. The CIN-specific components, once they are hammered out by the network’s physician leadership, are not negotiable. Doctors review the contract and either opt in or opt out.

Raskauskas says these legacy fee-for-service contracts won’t stall the integration aims. The plan is to counter that model’s many flaws by building a value base around understanding how care affects patients’ quality of life wherever it is rendered, and how to get key patient information to the next provider.

Getting Ready in Reading

Reading Health System learned the phrase “population health” about the time St. Vincent’s went in pursuit of it. When it replaced its executive team, says Jenckes, the health system was siloed, which provided little motivation to do things differently. “We were terribly antiquated in our IT structure, still a lot being done on paper.” And until recent years, hospitals in eastern Pennsylvania stayed within county boundaries. “We were in our own little cocoon,” he admits. As for population-level concepts such as clinical integration, “we had no concept, basically, that those even existed,” he says.

With new administration, “integrated networks and a whole new vocabulary came along,” and with it the realization that health care systems of their size in eastern Pennsylvania “were on average three to five years ahead of us.” What’s more, a large self-insured regional employer, East Penn Manufacturing, did some research and found that Reading’s costs were on average 40 percent higher than two other competitors, one in the next county, and threatened to start pulling its employees out of the system and into lower-cost settings, says Jenckes.

In response, Reading inked a risk-sharing contract with East Penn and set up Reading Health Partners as a physician-led and -governed limited partnership. “We clearly had to make a large change in our culture, and we did that by starting up a very simple heart failure program,” he says. “The program was not fiscally successful, but culturally it was huge for us.” Begun in 2011, it had to overcome a culture of isolationism. The care coordination and patient flow mechanics were not in place, and there were only enough resources to take 30 patients.

Getting any further depended on physician buy-in, and the makeup and mindset of independent practices posed major obstacles. Mutual distrust between the specialists and the administration went back more than 30 years, and the physicians refused to believe they had any competition.

So CIN leaders studied the record of outmigration from the system’s catchment area, omitting procedures that couldn’t be done at Reading, and assembling procedures the system was capable of performing, but were done elsewhere. “That was very telling: On a percentage basis, most of the specialists had between 12 and 22 percent outmigration,” says Jenckes. “So, part of our marketing approach to physicians besides the obvious — increasing value, increasing quality, increased patient satisfaction — was to say, ‘The reward for you is to bring some of this outmigration back into the system.’ And that kind of clicked with them.”

The next hurdle was sharing and reporting information. The CIN’s business plan involved signing up other community employers besides East Penn, but that depended on getting 100 percent of participating physicians connected to be able to extract data for quality metrics. Reading Health System since has implemented IT systems from Epic for the hospital and the 50 percent of the staff who are employed, at a cost of $160 million. But independents acquired 24 different electronic health records. The CIN just got all of them connected Aug. 1, and now it’s spending another $12 million to $15 million to support analysis for population health.

Bettering a Good Thing

Sharp Community Medical Group worked out its physician-acceptance issues in the late 1980s and early 1990s, when managed care was at its peak. The era came to a close by the late 1990s — except in California, says CEO Jenrette. The group, arguably organized as a CIN before the term emerged, continued to have a large population under financial risk, and alignment of incentives and rewards developed over time.

But with 40 percent of patients still in fee-for-service coverage, a dichotomy of practice evolved. “In many respects, physicians did practice differently with their at-risk and capitated patients — where they were clinically integrated — [versus] those that were fee-for-service [patients],” Jenrette says. “The rewards weren’t in place to coordinate care, to create the same outreach, the same patient engagement efforts, and case management.”

Physician leaders had worked closely with management in developing an infrastructure for a managed service organization, which assisted doctors in their own clinical management. The MSO issued reminders, made phone calls, got patients to come in for blood tests for diabetes; it assigned case managers to patients having medical issues; and pharmacists reconciled medications at care transitions.

The PPO patients, however, received the episodic care typical of the rest of the country, Jenrette says. “There wasn’t the same population management or coordination activities going on with that population.”

The group began working with URAC on coalescing the different care methods into a present-day CIN. Now the group is managing its fee-for-service patients in the same way it manages its capitated patients.

Whatever the approach, says Jenrette, “You’ve got to get something out of this effort financially. Whether that’s holding on to patients; whether that’s getting better at contracts within certain geographies if there are big employer groups; whether that’s relationships with health plans that are trying to drive quality and efficiency, and looking to physician organizations to do that for them.” CINs “create financial incentives, whether that be shared-savings models, or different fee-for-service models in order to drive it.” 

John Morrissey is a writer in Mount Prospect, Ill.


When Necessary, Boards Apply Brakes

More than ever, the devil’s-advocate duty of hospital boards is pivotal to evaluating any management response, whether timid or aggressive, to the issue of clinically integrated network development. Executives can’t be so cautious that they don’t take initiative where they should, but they also can’t plunge into risk because they perceive that “everybody’s doing a clinically integrated network, [so] we should do one, too,” says Thomas Enders, senior managing director of Manatt Health Solutions.

A check-the-box mentality of assembling what seem to be the logical elements of an integrated network won’t cut it, he says. But forging ahead without the means is equally dangerous. “If you rush to take a risk-based contract and you don’t have the systems and the trust and the structures in place, you could lose on it,” Enders says.

In those cases, “that’s probably a trustee issue, to say [to management], ‘Let’s really understand how you’re approaching this and the resourcing that you’re applying to it, and your motivation for doing it,’ ” he says.

Reading Health Partners, for example, is set up as a non-risk-bearing limited partnership wholly owned by Reading Health System, because it is providing 100 percent of the capitalization and startup costs, says Health Partners CEO George Jenckes III, M.D., the CIN’s CEO.

The system board and management authorized a strategy that is limited to pursuing only self-insured companies’ taking all the risk, like East Penn Manufacturing has done with its shared-savings contract, says Jenckes. “We didn’t want to start out with risk right away,” because of the possibility that the CIN might not deliver on its promises and would be passed off too soon by commercial payers as “just another program that didn’t work,” he explains.

A risk strategy in unfamiliar territory would be, well, too risky, he adds. The CIN won’t go there “until we feel we have more expertise — in contract negotiations, quite frankly — and then to have some more knowledge under our belts with respect to how risk-bearing contracts work.” — J.M.


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