Across the country, partnerships with independent physicians (and by that: I mean non-employment relationships) have become more important than ever. While the size of this partnership opportunity is quite large, with almost half of practices (49.1%) still wholly owned by physicians, potential partners aren't competing on the same playing field as before. Now, independent physicians have more agency and potential suitors than ever.
As a result, many organizations are revisiting their partnership strategy. In my team's conversations, we've found that the attributes that executives often identify as important, don't necessarily guarantee success. Here are three red herrings to watch out for—and my recommendation for what to focus on instead.
Toolkit: Pick an alignment model to support your goals
Don't be distracted by: Contractual model
Ask any executive about their current partnership strategy and most will reply with: "We have an [insert contract type] with [insert organization name.]"
While all physician partnerships have some underlying contractual mechanism, the decision about whether to align via JV, PSA, MSO, or any other model or membership arrangement isn't make-or-break—or even the first decision point when exploring partnership.
Instead, focus on: Strategic goals
Successful partnerships place more importance on shared goals over contracting specifics. Executives must first articulate their objectives for the partnership and then select a model that specifically supports this aim.
Ask yourself two questions:
- What are my goals for this partnership?
- Can I better achieve these goals working together than I can separately?
In my conversations with executives, the best partnership goals are pre-determined and demonstrate transferable benefit to the patient.
Both sides should be able to articulate not only their own objectives, but also what their partner wants to achieve. Leading organizations agree on metrics of success in advance that are tailored to the specific partnership and demonstrate the value in working together vs. alone.
Don't be distracted by: Executive relationships
Leaders commonly point to interpersonal relationships between partner organizations as the key to success. But one surprising finding from our work is that partnerships that hinge on peer relationships are actually more vulnerable.
Like any new initiative, champions are important, but if the fate of the partnership rests in the hands of a few individuals, it can mean starting from scratch when executives turn over.
Instead, focus on: Organizational trust
Rather than focusing on individual relationships, invest in building trust as an organization. Hardwire connections across the organization and at all levels so the partnership isn't dependent on a select few executives.
Importantly, this doesn't just mean increasing the number of people involved in the arrangement. Successful partnerships invest in the quality of relationships and proactively create trust.
While there are practical steps that organizations can start to take, like standing up joint steering committees and embedding shared processes, trust is built gradually through consistent, reliable interactions so this work takes time—the sooner you can start, the better.
Don't be distracted by: Longevity
Longstanding partnerships aren't necessarily good ones. While existing relationships may bring familiarity, that isn't always advantageous. Too often, these established relations are taken for granted and are slow to evolve with the market.
It isn't surprising that suitors who are offering new things to physicians, such as flexible arrangements and infrastructure support, are catching their attention. While these partners may be less familiar, physicians often feel like newer entrants better recognize their current reality and needs.
Instead, focus on: Value proposition
While partners may have previously fallen back on their history, they increasingly need to zero in on their value proposition to independent groups: Specifically, what they offer to physicians that's different and better than other potential partners in the market.
Importantly, organizations must constantly reassess and finetune these offerings, as physician needs and wants change. For example, data is king for risk-bearing physicians, and data needs change over time as groups take on more value-based contracts.
Partners should expect to work hard to win over physicians who are increasingly willing to play the field. As one physician group put it: "We work with multiple [partners] so we aren't beholden to a single one."