Hospital-physician alignment takes many forms

John Andrews, Contributor

Hospitals and physicians are forging tighter relationships than ever before and the nature of those bonds sports various guises. While economics seem to be the main impetus for these new alliances, providers have many reasons for seeking closer ties, industry analysts say.

“Ultimately it’s the degree to which the hospital and the physician community share a common vision, values and mission,” said Bob Gift, director of operations improvement for Chadds Ford, Pa.-based IMA Consulting. “Second to that is physicians having a meaningful role in operations and governing. The whole issue of alignment exists along a continuum – physicians have economic consideration, whether they are employees or have a partnership agreement. There is not just a financial incentive, but quality and outcomes incentives as well, tied in together.”

The key to alignment, Gift says, is finding common ground on patient care methodologies along with the financial considerations.

“What you’re looking for in any alignment strategy is developing a relationship that creates a ‘best partner’ scenario,” he said. “The hospital and physicians have to define and articulate what constitutes the best partner. Ultimately, that means establishing trust.”

Jeff Wasserman, vice president of strategy and executive leadership services for Woburn, Mass.-based Culbert Healthcare Solutions, believes that before they approach hospitals with an alignment initiative, physicians first need to get organized themselves.

“When we work in this area, we look at whether physicians are organized to the point where they can work with each other first,” he said. “How they organize can run the gamut, from formal clinical integration to a looser, more informal model. Alignment can take many forms, but the ones that are most successful are the ones that get more formalized and focus on how to improve patient care.”

‘Buzz word’

When Rick Carter hears the term “hospital-physician alignment,” he thinks of it as a “buzzword” more than anything else.

“It’s the term used for getting doctors to become employees of the hospital,” said Carter, CEO of Salt Lake City-based Equation Consulting. “It’s about offering physicians attractive terms to get them to bring patients to your hospital. That is the alignment hospitals want.”

Basically, Carter says hospitals are treating physicians like a commodity, spending 5 percent to 10 percent of their revenues on physician alignment.

“Some will spend on employment or 1099 relationships, such as directorships, on-call coverage or income guarantees, all designed to encourage doctors to admit their patients to the hospital,” he said. “They need a large quantity of patients to drive volume.”

Yet there is a certain irony in hospitals seeking to employ physicians, Carter says, because “they don’t really want to employ and manage them…but they know the pathway to cost improvement and quality is to collaborate.”

Aligned 20 years

While alignment has gained momentum and new arrangements continue to emerge, other relationships have been long entrenched, paying dividends for years. Such is the case with Jacksonville, Fla.-based Titan Emergency Group and its original hospital client, Memorial Hospital Jacksonville.

Emergency medicine physician Fred Jenkins, MD, is the medical director for the hospital’s emergency department though he is affiliated with Titan, which has had a management contract in place since 1989. Under the longtime agreement, Titan provides emergency physician and mid-level services to the hospital as well as the administrative infrastructure.

The ED staff is not employed by the hospital, nor is the arrangement a joint venture, Jenkins says. Titan employs 60 physicians and has four hospital clients across northern Florida. The Memorial ED handles 75,000 cases a year.

“We provide the man hours, the leadership required to manage the physicians and mid-level staff and collaborate with nursing for continuous improvement,” Jenkins said. “We are a separate organization, but we are very involved in hospital affairs, such as having physicians sitting on hospital committees.”
Matchmaking agents

Hospitals or physicians looking to initiate alignment relationships may find assistance from various types of third parties that specialize in professional “matchmaking.” While Sioux Falls, S.D.-based LodgeNet doesn’t focus specifically on bringing providers together, it targets the common ground element that both sides need – patients.

Through a suite of interactive technologies, LodgeNet helps patients prepare for provider encounters, hospital stays and chronic disease management with educational videos and other electronic media. The company offers patients information about their care team, condition, treatment, procedures, tests, medication, daily schedule and post-discharge instructions in order to better interact with their care providers.

“Our overall philosophy is about the patient experience, but the hospital-physician alliance has many pieces, which deal with accountable care organizations, value-based purchasing and patient outcomes,” said president Gary Kolbeck. “Patient-physician engagement is critical to alignment. The more information you share with patients to empower them results in better questions and better dialogue. If you can improve the patient’s understanding of what they need to deal with and follow a treatment regimen that is easy to implement, it will drive better outcomes.”

Lyndhurst, N.J.-based Vitals started in 2006 as a comprehensive healthcare provider database and has since leveraged that function into a service that links patients, professionals and payers together in different configurations.

“We are a connector,” says general manager Jeff Cutler. “Our focus has been on finding the right physician at the right time, but we are also working to help providers better define their relationships. We’re looking for ways where alignment will work, whether it’s better mix of payers or physician specialties, to create a premium patient experience.”


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