Posts Tagged ‘insurance reform’

4 Factors Driving Resurgence in the Physician-Hospital Organization Model Today

October 10th, 2014 by Cheryl Miller

As healthcare organizations seek the infrastructure to respond to emerging payment models like accountable care organizations (ACOs), bundled payments, narrow networks and direct contracts, the physician-hospital organization (PHO) model is experiencing a resurgence nationwide.

But will it work this time? Four factors make the PHO attractive, says Travis Ansel, senior manager with the Healthcare Strategy Group, during Preparing for Value-Based Reimbursement Models: PHO Development for ACOs, Bundled Payments and Direct Contracting, a 45-minute webinar from the Healthcare Intelligence Network (HIN) now available for replay.

The first most immediate driver is independent physician alignment, says Mr. Ansel. While most markets are mature in terms of employment, there are still a number of markets where there are a significant number of independent physicians in key specialties. In these areas, the PHO model is more of an initial catchall type of alignment model, one that creates a loose tie between the hospital and the physicians in the market, and provides value to the physicians in terms of being protected as part of a larger group without having to become employed. One benefit for the hospitals is that they can align independent physicians en masse and create common incentives, instead of having to negotiate alignment models or arrangements with all independent physicians in their market.

The second driver is the increasing mutual accountability for quality and cost across providers. In the wake of transitioning payment models under payment and insurance reform, insurers and payors are trying to drive mutual accountability for patient costs to physicians and hospitals. The PHO is an appropriate response for those providers to work together to manage the cost of a population and of an episode of care in order to make sure everybody’s successful.

The third factor driving resurgence in PHO activity is the consolidation and distribution of resources that will allow providers to be successful in managing quality and cost. As healthcare reform and payment reform mature, information technology (IT) competencies, clinical competencies, care coordination practices, and exploring the patient-centered medical home (PCMH) concept are often unrealistic at the individual practice level. The PHO gives physicians and hospitals the platform to work on those care competencies together, build them in one place and then distribute them to PHO members — a “win-win for everybody,” Mr. Ansel says.

The final driver is the need for an effective framework for clinical integration. While there are already a number of clinically integrated organizations around the country, “For the bottom 90 percent of healthcare organizations in the country, clinical integration is still that thing that’s on our to-do list, but it always gets bumped to the back of the to-do list; because, we have more immediate needs, or more immediate strategic priorities,” Mr. Ansel says. Clinically integrated models are needed as a strategy to respond to payment reform, to allow joint contracts between physicians and hospitals, and to enable sharing of payments effectively, whether those are shared savings payments, bundled payments, etc. Adds Mr. Ansel:

“The PHO model provides a great initial step to building that clinically integrated network platform, and gives providers and the hospital a great model for working together to start building the competencies towards a clinically integrated network.”

Click here for an interview with Mr. Ansel.

Healthcare Business Week in Review: Managing Heart Disease; Insurance Reform; Hospital Charge Disparities

September 13th, 2013 by Cheryl Miller


Nearly one in three Americans die of cardiovascular disease (CVD), including heart disease and stroke, each year, according to the latest Vital Signs report from the CDC. In 2010 alone, more than 200,000 deaths from CVD occurred, with more than half happening to people younger than 65 years of age.

Most CVD can be managed or prevented in the first place by addressing risk factors, such as reducing blood pressure and cholesterol and quitting smoking, CDC officials say, and they offer a list of recommendations for providers, communities and health departments for reducing the death rates.

Contrary to reports that individual health insurance policy costs will jump steeply under the ACA, there will be no widespread premium increase, according to a RAND analysis of 10 states and the United States.

There will be widespread differences in individual policy costs from state to state, however, as well as an increase in health insurance coverage and higher enrollment among people who purchase individual policies.

RAND researchers predicted how the ACA will likely change cost and coverage patterns in both the individual market and small group market in 10 states, including Florida, Kansas, Louisiana, Minnesota and New Mexico. Costs will be influenced by a specific range of individual factors, including age, tobacco use, geographic location, family size and amount of coverage purchases.

Geographic diversity is at the root of another study from the Center for Studying Health System Change (HSC). According to the report, hospital prices for privately insured patients — especially for outpatient care — are much higher than Medicare and vary widely within and across communities.

Within individual communities prices vary widely, even after accounting for differences in the complexity of services provided. The highest-priced hospital typically is paid 60 percent more for the same inpatient services than the lowest-priced hospital. The price gap within markets is even greater for hospital outpatient services, with the highest-priced hospital typically paid nearly double the lowest-priced hospital, according to the study.

In contrast to hospital prices, prices for PCP services generally are close to Medicare rates and vary little within markets, the study found. Prices for specialist physician services, however, are higher relative to Medicare and vary more within and across markets.

And lastly, sophisticated analytics behind today’s health risk assessments or health risk appraisals (HRAs) provide employers, payors and providers an aggregate view of population health and the raw material to develop prevention and lifestyle change programs. Tell us how your organization uses HRAs to improve population health in our Health Risk Assessments e-survey by October 15, 2013 and get a FREE executive summary of the compiled results.