Hospital and Health System In-House Counsel Seminar
Washington Plaza Hotel
10 Thomas Circle NW
Washington, DC 20005
As a charter member of The Advisory Board’s Health Care Law Roundtable, Bricker & Eckler is pleased to be able to offer this educational opportunity for Hospital and Health System In-House Counsel. The topics we have selected are of interest to hospital executives and we want to provide Hospital and Health System In-House Counsel with resources to stay current with these industry developments.
The Advisory Board
- Navigating Medical Staff Issues Arising with the Mix of Employed and Independent Physicians
- Accountable Care Organizations: Forming Collaborative Physician Enterprises to Transform Care Delivery (afternoon session)
Navigating Medical Staff:
Navigating Medical Staff Issues
Physicians and hospitals are now confronting unprecedented market volatility and many new challenges to successful business strategies of the past. Looking out on an increasingly bleak financial picture for the traditional model of private practice, many independent physicians report that they are reaching a breaking point, and are looking to radical options for recovering prosperity—investing in revenue-generating infrastructure, joining “supergroups," and pursuing non-traditional work arrangements. Hospital administrators are likewise forced to consider dramatically different ways of relating to the medical staff. Enjoying only tepid physician support for advancing key strategic goals, chief executives struggle to deliver on the market’s growing mandates for providing lower-cost, higher-quality care, and are pursing ever-more aggressive physician contracting approaches to secure a necessary alignment of interests. (Five years ago, few would have guessed that a large-scale physician employment strategy would command the level of CEO mindshare it surely does today.)
As ad hoc physician contracting activity has intensified—particularly in the area of physician employment—new tensions in hospital-physician and physician-physician relationships have emerged. Dominant among these tensions: independent physicians (reasonably) question the hospital’s employment activities and motives, and fear that they may be disadvantaged on the competitive playing field vis-à-vis their subsidized peers. Because hospital executives must continue to work with different members of the staff in different ways—just as hospital and physician needs vary markedly from service line to service line and group to group—the ability to defend strategic contracting decisions, limit avoidable damage to independent groups, and minimize divisive medical staff politics has become a new core competency for the C-suite. To effectively mediate the tensions of a mixed medical staff model, hospital executives must decide on a unifying theory of working with physicians—a philosophy that will guide and justify hospital contracting decisions, and offer important transparency and validation (even peace of mind) to concerned members of the medical staff.
This presentation is the Advisory Board’s first foray into strategies specifically aimed at navigating the politics of the mixed medical staff, and is designed to encourage conversation around hospital approaches to engaging the entire medical staff in value creation across the delivery system.
I. Always in the Middle
Already in the foothills of a much broader commitment to exclusive contracting with physicians, health systems and medical staffs alike are witnessing a change in the relationships between hospitals, employed physicians, and independent practitioners—often, not for the better. This section investigates several important trends: the rapid growth (including future forecasts) of physician employment and exclusive contracting activity by hospitals, the continued dominance of the independent medical staff model, the resulting polarization of the medical staff, and the challenges that polarization poses for advancing the goals of the larger medical enterprise.
II. Engaging the Mixed Medical Staff in Value Creation
With an eye toward forging a more sustainable alignment with physicians, this section focuses on ways to re-constitute relationships with (and between) employed and independent physicians to deliver greater value to the market. Included here are ideas for creating useful transparency around hospital decisions and physician performance, instituting defensible resource allocation policies, and building inclusive leadership structures for strategic and operational decision making—all of which aim to advance the goals of hospital-physician integration, irrespective of physicians’ employment status within the system.
III. Confronting the Integration Imperative
Moving into an era of value-based payment in health care, the key levers for sustained financial success of health care providers are shifting. Rather than building scale purely for pricing power, operational efficiencies, and negotiating clout with suppliers, hospitals and physician practices will need to prove that they can deliver greater value to the market by creating a more integrated care continuum—one capable of simultaneously reducing costs, improving quality, and enhancing access. For hospitals, beginning to meaningfully integrate pieces of the fragmented delivery system will require the development of a unified, principled and proactive approach to physician partnership. This final section highlights the larger lessons and organizing theories on physician partnership from the Health Care Advisory Board’s extensive research on this topic, covering big insights on designing and executing sustainable models of integration for success in a more challenging market environment.
Now that lawmakers have enacted the Patient Protection and Affordable Care Act, hospital and health system executives must confront the practical challenges of reforming the delivery system. Front and center is the key strategic question of how to prepare for emerging accountable care incentives, ultimately rewarding delivery of high-quality, low-cost care and encouraging demand destructive behavior.
Forming collaborative partnerships with a broad base of physicians will be central to success under payment reform and is a critical first step for health systems transforming into Accountable Care Organizations, or ACOs. This presentation provides detailed strategies for constructing the high-performing physician enterprise, developing effective incentives and fostering collective accountability.
I. Land Grab for Leverage
A convergence of forces—faltering physician economics, uncertainty following the passage of reform, and emerging payment models—are accelerating provider consolidation nationwide. Markets across the country are rapidly nearing the end of neutrality, fracturing along lines of alignment as independents seek stability through consolidation or health-system partnerships. Hospitals and health systems face two principal threats as consolidation intensifies. First, organizations may diverge from sound alignment strategy, selecting subpar partners or entering into poorly crafted relationships, in turn forming ineffective ACOs. Second, organizations may be slow to advance their accountable care strategies, risking exclusion from ACOs altogether, especially if well-organized physician groups mobilize around them. The solution is developing and executing a principled strategy for building the accountable physician enterprise.
II. Building the Accountable Physician Enterprise
The body of the presentation features 15 lessons for assembling the accountable physician enterprise, structured around three core themes. First, the study examines key strategies for building a culture of value-based partnership, highlighting tactics for selecting premium physician partners and engaging those physicians in governance and leadership. Next, we tackle the fundamental challenge of ushering physicians into a marketplace that rewards value over volume by extending resources to support high performance and introducing physicians to performance-based incentives. Third, we explore partnership models that reinforce physicians’ specific roles within the ACO and create shared accountability with partner physicians—independent and employed alike—to form the core of the ACO. This section includes specific strategies for aligning with primary care physicians, medical specialists and proceduralists.
III. Enterprise at a Crossroads
The final section of the presentation proposes three principled strategies organizations can pursue to secure their roles in a market driven by accountable care incentives. The study includes early guidance on setting course, offering five conclusions that explore the transition path and key management challenges for organizations embarking on the journey to accountable care. The presentation concludes with a call to action, highlighting the role of senior executives in this pivotal moment in organizational strategy.
There is no cost to attend. Lunch will be provided.