Is Hospital-Physician Integration Sustainable?

Reprinted courtesy of MCOL.

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Perspectives on a Selected Key Topic |     April 2011/May 2011     |   Volume Three Issue Two


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Will a material number of hospitals and their core medical staffs, that are relatively independent, evolve into highly integrated delivery systems during this decade, and why?

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William J DeMarco MA, CMC
Demarco1
President and CEO, Pendulum HealthCare Development Corporation

The great momentum brought about by government and private payers demand for more accountability is unstoppable. Rapid consolidation of hospitals and consolidation of physicians by physician groups, hospitals and now insurers will shift referral patterns and consumer preference. 1 out of 4 hospitals will fall short of providing value and close or be absorbed within 10 years.

Physicians will be offered higher prices to sell out to insurers and investors who value the short supply of PCPs and will try to control care demand by retooling the care system building ASC and small scale short stay hospital.

True clinical integration will follow for the survivors. The ability to prospectively develop clinical budgets and bundles of services will connect regional tertiary and quaternary care facilities to local hospitals so integration can be regionalized across larger populations and payer segments.

Once these delivery systems realize they need a product recognizable to individual consumers they will seek alliance with select insurers or create their own insurance company thereby achieving the true definition of integration which is to integrate financing and delivery of care.

This offers the shared savings with themselves and stabilizes patient flow and overhead to achieve value to purchasers and users of care.

We think these opportunities will be at a tipping point on a market by market basis over the next 5 years and will be a national definition of success within 8 years. We believe this will happen because already the bond rating companies are looking at physician alignment and payer alignment as factors in establishing credit worthiness of hospitals for expansion and mergers.

Benjamin Isgur
Isgur2
Director, PricewaterhouseCoopers LLP’s Health Research Institute

Integration is certainly on the rise. The notion of independent physicians may be a myth because so-called independent physicians are becoming increasingly financially tethered to hospitals. In fact fifty-six percent of physicians PwC surveyed want to more closely align with a hospital in order to increase their income. The new health reform law focuses on population health and adopts a Medicare compensation model that penalizes poor quality and rewards cost savings and electronic information sharing. Some commercial payers are also pushing this business model.

Part Deux: A Rebuttal to PHR Luddites

DnaBy now most people understand the promise of pharmaceuticals being customized to “YOU” based on your individual genetic code.  While this isn’t prevalent today, we understand that this will be possible in a few years.

Let’s take a minute to consider the mechanics of how this will occur. You’ve received a prescription, and it directs the pharmacist to tailor the medicine to YOUR genetic profile.

Consider two possible scenarios of how this transaction might happen. You’re on the phone with your pharmacist:

1) “OK, you need my DNA sequence. I keep my genetic profile in my mattress…let me get it and I’ll read it out loud to you.  C, A, T, G, G, A, T… no,  that was actually a G…let me start over.  C, A, T, G, G, A, T… (19 hours later) … T, and G. Can you read that back to me to make sure you got it right?”

2) “You have permission to access my DNA sequence at my health URL (or maybe a health record bank, or perhaps hand her a flash drive, or ??).

Still think you’ll never use a PHR?

Table of contents for the series--PHR Systems

  1. A Rebuttal to PHR Luddites
  2. Part Deux: A Rebuttal to PHR Luddites

A Rebuttal to PHR Luddites

Unlike some of my colleagues, I’m not losing ANY sleep over whether personal health record (PHR) systems ultimately will be adopted and used by patients.

In my mind, the issue isn’t WHETHER, but WHEN.

Yes, I know that adoption has lagged and that surveys suggest 7% or less of the U.S. population has used a PHR.

Stay with me on this one for a minute. You’d have to have two underlying beliefs to conclude that PHR systems won’t eventually emerge:

  • That health record data will persist in non-electronic formats, i.e., paper
  • That people won’t have interest in accessing or using their health record data

Table of contents for the series--PHR Systems

  1. A Rebuttal to PHR Luddites
  2. Part Deux: A Rebuttal to PHR Luddites

Doctors Love iPads. What Does it Mean? What Does it Mean?

After attending the largest annual health IT conference of the year — HIMSS 11 –  John Moore reported that “nearly every EHR vendor has an iPad App for the EHR [electronic health record], or will be releasing such this year.”

Doctors love iPads…not surprising? But, how might you explain this?

There are at least two different possibilities:

  • Coincidence Theory
  • Conspiracy Theory

The Coincidence Theory

So doctors want to access EHR software through the iPad…what’s the big deal?

Apple has built a great new hardware platform with the iPad. There’s nothing else like it in the marketplace.  While other companies are building competing tablets, Apple’s has been the only viable option in the market for over a year.

Getting DIRECTly to the Point: The Role of the Direct Project in Fast-Tracking Health IT Interoperability

By Rich Elmore and Arien Malec. Rich Elmore is the Direct Project Communication Workgroup leader and Vice President, Strategic Initiatives at Allscripts.  Arien Malec is ONC’s Coordinator, Direct Project and Coordinator, S&I Framework.

A patient’s health records are no longer confined to a doctor’s office, shelved inside a dusty file cabinet. With the advent of the Nationwide Health Information Network, a framework of standards, services and policies that allow health practitioners to securely exchange health data, medical records digitized to be easily shared between doctor’s offices, hospitals, benefit providers, government agencies and other health organizations, all across America.

This health information exchange is dramatically enhanced by the Direct Project. Launched in March 2010, the Direct Project was created to enable a simple, direct, secure and scalable way for participants to send authenticated, encrypted health information to known, trusted recipients over the Internet in support of Stage 1 Meaningful Use requirements. The Direct Project has more than 200 participants from over 60 different organizations. These participants include EHR and PHR vendors, medical organizations, systems integrators, integrated delivery networks, federal organizations, state and regional health information organizations, organizations that provide health information exchange capabilities, and health information technology vendors.

Complimentary Webinar — An Impending Marriage: Electronic Health Records (EHRs) and Care Management Software

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Webinar Title: An Impending Marriage: Electronic Health Records (EHRs) and Care Management Software

The presentation will be geared at practicing clinical case managers in health plans, hospitals, disease management companies, and similar organizations:

  • Describe market forces driving integration of EHRs and care management software. 
  • Review care management software survey data and stimulus funding for EHR adoption. 
  • Describe a 3 stage framework for the evolution of EHRs and care management software. 
  • Characterize benefits to patients and impacts on care manager responsibilities.

The event is sponsored by HealthSciences Institute and the PartnersinImprovement Alliance.

When:

Friday, February 4, 2011
11:30 am Eastern Time
10:30 am Central Time
9:30 am Mountain Time
8:30 am Pacific Time

Your Presenters:

Vince Kuraitis JD, MBA
Better Health Technologies, LLC

Garry Carneal, JD, MA
Schooner Healthcare Services

More Information and Registration:  Click here.

Updates on Proposed Stage 2 and 3 Meaningful Use Criteria

The Health IT Policy Committee has published proposed Stage 2 and 3 Meaningful Use Recommendations and they’re open for public comment until February 25.

I’ll share a couple of particularly useful and well written analyses and commentaries by colleagues.

Health IT guru and thought leader Dr. John Halamka writes about The Proposed Stage 2 and 3 Meaningful Use Recommendations in his blog.

This is a great article to get a thumbnail overview of all the proposed recommendations. John lists 38 criteria and provides a quick commentary on how challenging he sees each of them. (Keep in mind that he’s CIO at one of the most HIT-advanced health systems in the country — your definition of “easy” and his might not be alike.)

Is Physician EHR Adoption Getting Past the Penguin Problem?

Remember the penguin problem described by economists?

No one moves unless everyone moves, so no one moves. 

Overcoming the penguin problem has a lot to do with creating expectations. A recent writing by Dr. James O’Connor in Physician Practice expresses a voice from the physician community that I’ve never heard before.  His essay is entitled “Meaningful Use — Doctors Have No Choice”.

Care Coordination Metrics: One Can of Worms that NEEDS to be Opened

Can

“Track who is on a care team — and share info with the patient.”

That’s just one of the summary recommendations coming from expert testimony given in a recent public hearing on how to improve care coordination through the use of health information technology. The Meaningful Use workgroup and Quality Measures workgroups are now wrestling with how to translate this recommendation into meaningful use criteria for HITECH Stages 2 and 3.

Seems like a good idea — simple, straightforward — perhaps even obvious. The EHR (electronic health record) could be a great tool for keeping care team members in the loop and on the same page about a patient’s care.

But then I thought about this for a few minutes, and the complexities started dawning. This seemingly simple recommendation — “Track who is on a care team and share info with the patient” — is the proverbial can of worms.

“Disease Management” RIP

The Care Continuum Alliance has mercifully and wisely rebranded it’s name and eliminated the initials “DMAA”. See its press release: Care Continuum Alliance Launches New Brand for Population Health Improvement. (As a reminder, DMAA originally stood for Disease Management Association of America.)

I for one say “hurrah, and good riddance”.

Where Did the Term “Disease Management” (DM) Trip Up?