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Restructuring for Accountable Care: Achieving True Provider Integration
A MemorialCare Case Study
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MemorialCare Health System
Long Beach Memorial
Orange Coast Memorial
Miller Children’s Hospital Long Beach
Saddleback Memorial San Clemente
Saddleback Memorial Laguna Hills
Community Hospital Long Beach
Six Nationally-Recognized Hospitals
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MemorialCare Medical Foundation Locations
Costa Mesa
Huntington Beach
Irvine
Mission ViejoIrvine
Westminster
MemorialCare HealthExpress – 3 locations inside ALBERTSONS/Savon
MemorialCare Medical Group – 25 locations
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Coming Soon! Our Newest Site
Los Altos MarketCenter•30,000 sq. ft.•19 physicians•Urgent care•Lean design•Winter 2012
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Serving our Communities Together
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Just the Facts
• Total Assets $2.170 billion• Annual Revenues $1.668 billion • Bond Rating AA- stable • Patient Discharges 67,000• Patient Days 327,000• ER Visits 169,000• Senior Lives 72,500 • Commercial Lives 129,300• Babies Delivered 9,500 • Surgeries 37,000• Employees 11,000 • Medical Staff 2,500
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Fully Engaged for Excellence
Traditional Engagement ApproachesAcademic Affiliations & Medical EducationMedical DirectorshipsManaged Care Risk/Capitation AgreementsSaddleback Physician Services – MSORecruitment: Income Guarantees
Innovative Engagement ApproachesPhysician Society Physician Leadership Academy
Evolving Engagement StrategiesElectronic Medical Record – Inpatient & AmbulatoryOutpatient Specialty Clinics (1206D)Medical Foundation (1206L)Joint VenturesRetail Medicine
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Levels of Alignment
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Industry Assessment
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Current Factors Driving Consolidation and Integration
Access to Full Continuum of Care
ManagementExpertise Investments
in Technology
Economies ofScale
PurchasingLeverage
PrivateEquity
Weak Economy
Physician Integration
Managed Care Expertise
Access toCapital
Unprecedented combination of macro-economic influences, industry pressures and market dynamics driving consolidation and integration
Consolidation
Physician Recruitment& Retention
Low InterestRate Environment
Operating Efficiencies
Risk BearingCapabilities
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Successful and Meaningful Integration…
Often a Product of Positive Personal Relationships Rather than a Function of Economic Factors or Legal Structures
Common Themes that Lead to Success:•Articulation of clear vision and strategy•Commitment to vision at the highest levels•Demonstrated resources to fulfill vision and implement strategy•Deliberate focus on cultural integration and trust•Development of key interpersonal relationships•Absence of internal/conflict of interest factors•Track record of fulfilling deal commitments
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Physician Shortage Projections
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85 Percent of Physicians Seek… Employment ModelsAccording to the 2010-11 Occupational Handbook from the Bureau of Labor & Statistics
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Physician/Hospital Partnership
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MemorialCare Strengthening Through
Alignment: 10 Key Areas of Focus – FY13
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Area of Focus #1
Growing and consolidating to meet population health management needs:
• Inpatient• Outpatient
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Area of Focus #2
Responsible for the health of a population.
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Area of Focus #3
Healthiest health system in the nation.
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Area of Focus #4
World-class employee engagement year over year.
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Area of Focus #5Through direct relationships with employers and municipalities ―
improving health of their employees
and reducing costs.
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Area of Focus #6
Cost of providing care 20% lower than today. A culture of financial discipline.
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Area of Focus #7
Total number of patients in our hospitals decreased, but number in our care increased.
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Area of Focus #8
Preferred partner of physicians in all practice models.
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Area of Focus #9
Quality and service ensuring we receive all pay for performance monies available to us ―
and
our communities will be healthier.
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Clinical Quality> 75% reduction
in serious infections across our system
Providing Value in Health Care
> 85% reduction in pressure ulcers (HAPU) across our system
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Providing Value in Health Care
MemorialCare Health System• Top 100 Integrated Health Network by SDI
Long Beach Memorial, Orange Coast Memorial, Saddleback Memorial• Named in U.S News & World Report 2011-12 Best Hospital
Miller Children's Hospital Long Beach• “Hospital of Choice” Award from American Alliance of Healthcare
Providers
MemorialCare Medical Group & Greater Newport Physicians• CAPG 4 Star Elite Group Award for clinical quality
MemorialCare Medical Group • Honored by IHA as one of the Top 20 performing groups in CA for
quality, patient satisfaction, and IT
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Area of Focus #10
MemorialCare is the gold standard in health care.
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MemorialCare Current State of Alignment:
MemorialCare Medical Foundation
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Physicians as Partners Achievements
MemorialCare Medical Foundation
IPA Division Group Division
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MemorialCare Entities
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Foundation Structure: 2011
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MemorialCare Medical Group October Statistics
• 181 employed Providers– 150 Physicians
• 122 Primary Care (FP, IM, Peds, Geriatrics)• 28 Specialists
– 31 Ancillary Providers (NP, PA, Acu, Pharma, Psych)
• >1000 contracted physician specialty network• 31 clinical locations, including
– 3 Retail Clinics (Health Express)– 5 Urgent Care Centers
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Multiple Levels of Integration
• Medical Group into Hospital System
• 4 Medical Groups into 1 Medical Group
• Multiple new practice acquisitions (18)
• Specialists into Primary Care Group
• IPA into Foundation
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Group Acquisition and Integration Fears
• Long Term Vision -Fill Beds vs. Population Health
• Culture -Care Delivery, Quality Focus
vs. Corporate
-Primary Care vs. Specialist
• Management Team -Security, Control
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Fears and Excuses
Top 5 reasons NOT to integrate into one MemorialCare Medical Group:
– Rapid influx of new, unknown doctors– Adding high paying specialists to primary
care– Multiple new locations, distant geography– Different histories and cultures– Different agendas: FFS vs. HMO, community
vs. academic, independent vs. group practice
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Overcoming our Fears Through a Shared Vision
Mission To improve the health and well being of individuals, families, and our communities through innovation and the pursuit of excellence.
Vision Advancing health in extraordinary ways— together.
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Overcoming our Fears — Shared Vision of Integrated Delivery System
Break Down Silos Through:
•Clinical Integration
•Operational/IT Integration
•Financial Integration & Aligned Incentives
•Cultural Integration
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Achieving True Provider Integration: Culture
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Culture Eats Strategy…
…For Breakfast, Lunch and Dinner!
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Understanding our Culture
• Patient Centered• Quality Measures• Recognition & Rewards• Transparency/Honesty• Entrepreneurship• Managed
Care/Delegated Model
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Cultural Integration Strategies
• Focused on improving the culture and creating a shared vision
• Created Guiding Principles and Core Values
• Built a Strategic Plan together
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Cultural Integration Strategies
• Created process to engage doctors in bringing in new doctors/groups:– Integration Committee– New Provider Orientation revamped– “Rules” around shareholder status, schedules, etc…
• Mix committee members
• Social events: Dinners, CME, Leadership
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Achieving True Provider Integration: Clinical
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Virtual Case Conference Program
• Interdisciplinary case management conference run in a virtual fashion through weekly teleconference
• High risk, complex cases identified by risk stratification
• 75 cases since July 7, 2011
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VCC Results
• Number of inpatient admissions lowered by 31 (42%)
• Number of ER visits lowered by 18 (82%)
• Cost of claims paid decreased by $183,888 (41%)
• Average cost savings per case: $3,913
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Saddleback Memorial Disease Management Pilot• Focus on CHF, COPD• 2 NPs, 2 Tele-health RNs• Home visits• Care Team Connect • 80 patients enrolled • Average age 86
Results:• Quality of life assessment
scores up 36%• Functional scores up 32%• Heart Failure readmissions
down from 30% to 8%
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Achieving True Provider Integration: Financial
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Shared Incentives & System Think
• Focused attention on aligned incentives– Pay for performance
bonuses– Key quality indicators– System-wide projects
(e.g. ASCs, Imaging)• System Think
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Professional Services Agreement
Alignment among:• Hospitals• Foundation• Medical Group• Individual Physicians
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Achieving True Provider Integration:
Operational/IT
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Operational Integration
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Joint Operating Committees
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Technical Integration
• One patient one chart philosophy• Comprehensive EMR technology
– Inpatient– Outpatient– Ancillary sites– Patient portal
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Future Integration Milestones
• Finish IT interconnectivity
• Standardize Best Practices and expand Care Coordination Model
• Develop innovative ways to communicate across the system