Becker's Hospital Review

Clinical Integration & Physician Issues 28 Phase 2: Assimilate Settling for poor leadership is the key pitfall of the assimilation phase for most employed physician groups. Moving professionals from independence to a single operating model is not completed without deft leadership. Because the direct revenues are of a different scale than the hospitals, health systems often underappreciate the need for dynamic leadership to migrate the employed group from a collection of individuals to unified operations. • Practice name and identification As a system moves into the assimilation phase, system activities focus on how to organize previous independent practices into a cohesive physician enterprise. It is in this phase that most health systems become stuck, often derailed by decisions made in the earlier phase and the inability to lose physicians to create a single operating model. Those systems who succeed often do so by focusing on creating common: • Governance • Hours of operations • Mix of services • Productivity assumptions • Minimum practice size • Visual and service standards • Staffing • Facilities Not dissimilar to other well-known brands, the employed physician group must have a brand and operations that reflect that brand. • Operating expectations • Financial reward structures A large group of highly trained professionals typically requires a large degree of empowerment and self-governance to remain engaged. However, education of the operating realities needs to be included in any empowerment effort. Many physician groups are not used to the business and clinical activities of the health system; similarly, many health systems do not understand the governance of individual practices.  To create an effective governance model, the employed physician enterprise must encourage physicians to be active strategic agents in the business of healthcare. While their day-to-day administrative workload is dramatically, and often thankfully, reduced once employed, health systems continue to need their focus on the market and populations. Practice operations also need to change. Not only do new information systems and HR policies change, but so to must the practice look, feel and external perception. The strength of scale requires that the individual physicians be seen as a common brand. This typically includes: When it comes to incentives, financial rewards are very tangible. As such, what is financially rewarded will be very visible to the members of the employed group. If the focus is only on volume (e.g., wRVUs), the group tends to shift away from managing payor mix, from focusing on the needs of a population, and instead looks for the volumes to fill its practices. Even in an employed practice setting, the physicians cannot be immune from the macro-economic realities of healthcare. As marketbased reimbursement increases for primary care (nurse practitioners up 18 percent, physicians up 16.7 percent 2007 to 2011) compared with specialists (up 15.7 percent 2007 to 2011),6 the employed physician group must also respond. In addition, the review of referrals outside the system and cross-subsidization in the managed care contract rates must be carefully managed to ensure that the best patient care is delivered in a fiscally responsible way.   Assimilation strategic pitfalls The strategic pitfalls of the assimilation phase generally revolve around two aspects: • Leadership Scale requires infrastructure. Moreover, the infrastructure needed to run a large multispecialty physician group (employed or otherwise) is not the same infrastructure as is required to run a health system.  Employed physician groups must continually invest in the ability to create connectivity and communication across the group if it expects to assimilate the individuals to something greater. Phase 3: Integrate Over time, the physician enterprise starts to work as a team, driving consistency in experience and care, and becomes an integral part of the system's strategy and differentiated value proposition. During the integration phase, two elements take on renewed significance: clinical models and multispecialty group culture. The clinical model for primary and specialty care is dramatically changing with the increasing emphasis on population health and risk-based models. Organizations are implementing a more focused approach to specialization, often using a team of providers to better manage patients across their disease/illness journey and ensure care is received and coordinated within the network system. When integrating different physician groups, organizations need to define the clinical model(s) they should pursue over the next decade and the implications for the broader enterprise.  • Infrastructure Phase Key Strategy 1. Aggregate Acquire and recruit a market-balanced mix of physicians into an employed physician group under a common set of expectations 2. Assimilate Bring the disparate physicians into a single governance, operating and clinical model 3. Integrate Create a culture focused on the populations' needs such that there is not differentiation between the aims of the physician group and the health system    Indications You Are Headed Off Course • ou have more specialists than primary care Y (particularly cardiology, neurosurgery and orthopedics) • he organization only considers inpatient admissions as the T indication of alignment • ou are heard telling an acquisition target "you can keep your Y operations the same as they have always been" • ou let the acquired practice keep its name and you refer to it Y by its historical group name • here is no clear expectation about the organization's purpose T or how clinical activity will be aligned • inances are about downstream revenue or patient attribution F rather than total cost of care • he vision is integration rather than population health T

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