A great description of the state of health care today was written to promote a different vision called “platforming.” The term is apparently a new buzz word in business circles, but the idea is an old one—the focus of the organization should be on the customer—previously known as the patient.
“As health systems have matured, many have become operating companies that achieve efficiencies through centralized management of core functions (e. g. revenue cycle, supply chain, and human resources.) In the process, they have centralized operations and embraced “systemness” as a managerial strategy for optimizing performance.
Systemness works well under fee-for-service (FFS) payment models but does not serve consumers well…In its pure form, systemness seeks efficiencies by streamlining operations, reducing service duplication, and facilitating performance comparisons between operating units…In fee-for-service medicine, the business of health care prospers by doing transactions at high payment rates. Consequently, health care’s managerial class has invested in high-margin procedures and implemented aggressive coding, billing, and collection practices…The managerial focus explains a health care anomaly. Almost all providers have robust revenue cycle capabilities, but lack cost-accounting acumen.”
The authors note “value-based” purchasing converts treatment centers to cost centers and acute care interventions to high-cost, last resort interventions. They argue the goal in the old system was getting paid, but in the new system it is “creating value.” It is clear they buy into the value proposition, but it also remains clear much of health care, and the public, have not. They believe in the future state business will accrue to organizations that can differentiate themselves on “brand, price, and customer experience.”
The examples cited as “platforming” are what I term “clinical integration” or “virtual integration.” If we use existing capabilities to improve information flow and individual care planning, we obtain most of the “value” without the need to merge businesses. I spent a great deal of time and effort promoting this idea locally but found I could not get past discussions of ownership and “equity” on the part of the hospital partner, and the desire to extract revenue from the hospital by the physicians. However, a report from Partners Healthcare in Boston does show one example of the kinds of success that can be obtained from clinical integration.
Their example is dialysis patients who receive care at the dialysis clinic, the primary care office, the emergency room, and the hospital, but keeping everyone aware of what was happening in the other silos is difficult. Failure to facilitate the care coordination, though, was resulting in preventable morbidity and expense.
They began their program in 2016 and hired an RN care-coordinator who identified patients at risk for repeated hospitalizations and instituted interventions including face-to-face visits, medication reviews, treatment monitoring, immunizations, managing the vascular access and coordinating with all the sites providing care to the patient. As of the report they had contacted 100 patients and were coordinating care for 54 of them. They attribute their efforts to a reduction in ED visits or admissions of 5 per patient annually, 20% have been referred to palliative care, and transplant referral rates have increased. They calculated a $428,000 savings from 74 avoided ED visits and 34 avoided admissions, and a $1 million savings from increased transplantation rates.
Interestingly, all the interventions are ones that I used with my group over the years with results that showed consistently lower hospitalization rates up until about 10 years ago. What happened was that patients I used to see myself in the ED were increasingly seen by ED and hospitalist physicians who did not know the patient, did not have a baseline feel for the patient’s issues and thought they looked “sick” and so admitted them. And the number of patients and partners exceeded what I could do myself, so there was no way to micromanage care.
The lessons from my experience and published reports is that personalized, individual care by a small group of physicians to a small group of patients no longer exists, but we need to recreate the effect using ancillary staff and computer systems. The primary goal, both for the patients and the payers, is to keep the patient out of the emergency room, and ideally out of the hospital. But when these events occur, it is important that management changes are communicated to everyone involved. But communication is a two-way street. The hospitalist needs to be aware of the outpatient care plan and honor it, not choose to treat the patient however he/she sees fit.
The big question remains, though, does attaining clinical integration require business integration? Hospital systems say yes, because they, too, recognize most care management is designed to reduce their volumes. But if they choose systemness, they may saddle themselves with costs which later sink the ship. Attempts at physician group ownership by hospitals are a good example of this problem. While it may be possible to fix the issues, it is not easy, not quick, and requires a degree of desperation, with no guarantee of success. The other challenge is who will pay for the costs of virtual integration. The obvious candidate is the insurance companies, who stand to benefit the most from reductions in the medical loss ratio, but their political standing is not good. Provider groups might benefit, but often lack the necessary capital resources.
I fear we are headed to a two-tier system where the big metropolitan areas will have monopsony, but fierce competition and capitated payments, and smaller areas that will have monopoly and FFS payment with no competition and few capitated payments except for CMS, which will do whatever it decides to do. Thus, we will continue the current schizophrenic state into the future and most physicians will be working in systems that do not put the patient first.
3 December 2019
 Compton-Phillips A, Johnson D. Platforming Health Care to Transform Care Delivery. NEJM Catalyst, 19 September 2019. Accessed 24 October 2019 at https://catalyst.nejm.org/platforming-health-care-transform/.
 Kelly YP, Goodwin D, Wichmann L, Mendu ML. Breaking Down Health Care Silos. HBR, 1 July 2019. Accessed same day at https://hbr.org/2019/07/breaking-down-health-care-silos/
 Crowley T, Nielson R. How to Have a High-Performing Employed Medical Group Without a Subsidy. NEJM Catalyst, 22 November 2017. Accessed 29 November 2017 at https://catalyst.nejm.org/high-performing-hospital-employed-medical-group/
Barriers to Innovation
Innovation is critical for organizational survival, but internal and external forces make it difficult.
Building Resilient Dialysis Units
Clinical Integration for Administrators
Clinical Integration 2015: A Hospital Perspective
Health care organizations now assume "clinical integration" is necessary for economic survival, but the FTC continues to enforce antitrust actions blocking mergers and acquisitions. Furthermore, clinical integration usually means different things to hospitals and physicians. In this article I consider some immediate steps that can be done without legal complications to improve patient care and save money. All that is really required is a change in our mental models.
Organizing for Success - Another Viewpoint
Organizing for Success - Key Requirement