The Accountable Physician Enterprise

Partnering with Physicians to Transform Care Delivery

Topics: Accountable Care, Market Trends, Strategy, Hospital-Physician Alignment, Physician Issues, Health Policy, Clinical Integration, Medicare, Reimbursement, Finance

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After reading this study, members will understand:

  • Why health care reform is creating a renewed focus, from both hospitals and physicians, on physician employment and integration
  • Why it is imperative that hospitals move to build ACOs with physician partners before physicians act alone
  • How to make physicians true partners in the delivery of coordinated, high-quality, low-cost care
  • How to usher physicians—both employed and independent—into the emerging performance-based health care market
  • How to contractually organize with physicians for shared accountability payment models

Executive Summary

Accountable care heightening imperative for hospital-physician alignment
Always a top-of-mind issue for hospital executives, physician integration has taken on an even greater sense of urgency as organizations prepare for accountable care. With a looming mandate to manage total-cost risk for patients, hospitals must make physicians true partners in delivery system redesign. Even if hospitals are unsure of the exact delivery model they will be operating in five or ten years time, the reality that strong, mutually beneficial physician partnerships will be required cannot be ignored.

Creating a culture of value-based physician partnership
As the health care payment landscape shifts from status quo fee-for-service and toward more accountable payment models such as bundled payments and shared savings, hospitals and health systems need to reassess the characteristics of a premium physician partner, and prioritize alignment with physicians meeting that bar.

Ideally, only physicians identified as premium partners—who consistently deliver high quality, low-cost care and ensure appropriate utilization—should be included in risk-sharing payment models. Hospitals then need to engage physicians in leadership and governance structures that maximally engage physicians as true partners in preparing the hospital for accountable care readiness.

Attributes of Ideal Physician Partners

Ushering physicians into the performance-based market
As markets move toward accountable care, health care providers are entering a payment landscape with vastly different incentives that reward a new set of performance metrics. Hospitals building an accountable physician enterprise must usher physicians into the new performance-based market by extending resources to support the delivery of high-quality, low-cost care. They must design new incentives that reorient both employed and independent physicians from the “eat what you kill” payment system of today to emerging value-based payments, and invest in robust performance management systems to collect and analyze data needed to drive continuous improvement.

Organizing for shared accountability
The accountable physician enterprise requires both an efficient procedural enterprise and an effective care management enterprise. The different functions and responsibilities of the physicians contained within each group of physicians may necessitate differently structured contractual models. Contracts with “ACO Partners” must incentivize proceduralists and hospital-based non-admitting specialists to consistently deliver high-quality, low-cost care. These contracts must enable things like device standardization, order set compliance, and decreased length of stay. Contracts with “ACO Principals” must incentivize primary care physicians and community-based medical specialists like cardiologists and endocrinologists to coordinate care across the continuum and manage population health by increasing quality, lowering costs, and reducing utilization. Only two physician alignment models enable hospitals to fully realize the characteristics of an ideal, performance-focused integration platform needed for the highest level of functional integration with “ACO Principals”: extensive, effectively managed employment, and Clinical Integration (CI).

Hospitals, Physicians Strengthening Formal Relationships

Access the full study for more information
The Accountable Physician Enterprise: Partnering with Physicians to Transform Care Delivery aims to provide hospitals and health systems with guidance for the level of physician integration needed for accountable care, covering 15 key lessons for creating a culture of value-based physician partnership, ushering physicians into the emerging performance-based market, and contractually organizing with physicians to accept new payment models.

A Renewed Focus on Physician Alignment

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