LAS VEGAS—Providers should consider a physician alignment model via health IT instead of an acquisition model, but better methods are needed to improve patient safety and maximize reimbursements, according to a Feb. 22 presentation at the 2012 Healthcare Information and Management Systems Society (HIMSS) conference. Regardless, a one-size fits-all strategy is no longer reasonable, the presenter suggested.
Hospital-physician alignment was at its height in the 1990s, explained Gaurov Dayal, MD, senior vice president and chief medical officer at Adventist HealthCare in Rockville, Md., who referenced the time as a “boom-and-bust cycle.” In the 1990s, the “health maintenance organization (HMO) acquisition rush” highlighted many of the challenges of physician acquisition, including decreased physician productivity, misaligned physician incentives and increased costs.
However, the most recent boom of alignment was catalyzed by reimbursement. “Recent changes in reimbursement put hospital-physician alignment strategies at an inflexion point,” Dayal said. “Thus, hospitals must align with physician practices to maximize future reimbursements.” Also, the trend is clearly on an upward trend, as Dayal said that approximately 50 percent of physicians in practice are currently employed by a hospital.
In the past, alignment solely meant acquisition; however, Adventist is exploring another approach: alignment without acquisition. “The risks associated with this acquisition strategy [as exemplified in the HMO acquisition rush] should compel hospitals to consider alternate strategies,” Dayal said.
He recommended an alignment strategy through health IT, and defined alignment as “close working relationship in which a hospital and physicians place a priority on working toward common goals and avoiding conduct that damages the other.” This strategy requires a change in physician behavior, specifically through his or her interaction with a health information exchange (HIE).
Thus, Adventist launched ACES [Ambulatory Care EHR Support] program, and has two parts: Supporting affiliated physician practices to adopt EHRs and building an HIE. For the first part, the ACES EHR program, launched in May 2010, now has more than 100 ambulatory physicians live on two EHR systems.
The second part, the ACES HIE program has not yet been rolled out, but the health IT leaders are working on it. They are currently in the contract selection phase, which is “confusing and complicated,” said Dayal because of the sheer number of vendors in the space.
“For a successful coordinated care model of a patient-centered care model, data must flow and be tracked in all directions—from hospitals to physicians and vice versa,” Dayal said. “The local hospital-led HIE is a fundamental part of the strategy.”
ACES is “one-half of a two-sided coin,” said Dayal, as it is an alignment model for ambulatory physicians who want to remain independent; however, Adventist is planning to acquire practices and build a 200-physician, multi-specialty group by 2017. Also, he added “there is no cookie-cutter solution, as each hospital has unique needs.”
Dayal touted the benefits of alignment without acquisition including care coordination; the ability to meet mutually-beneficial strategic goals (e.g. reducing readmissions); and strengthening the relationship between physician and hospital. He added that reducing readmission rates is a strategic goal for ACES, because it can connect inpatient and outpatient care, improve rates of follow-up care and align incentives.
Also, he listed some of the risks with acquisition, which included the upfront cost of purchasing physician practices, the limitations of physician independence and the potential of decreased physician productivity. Also, Dayal said financial and operational flexibility of alignment may hold benefits because the “constantly-changing state and federal legislation increases ‘systemic risk’ to acquisition models. Instead, a hospital with a large aligned physician population and robust HIE can easily adapt to emerging payment models.”
As a real-world example, Dayal said that “we’ve been doing [an alignment model] fairly successfully for the past two years.”
However, he also acknowledged some of the challenges with the alignment model, including:
- Can a hospital change physician behavior without an “iron fist?”
- How does an aligned hospital respond to bundled payment models?
Ultimately, Dayal suggested this alignment model