Physician patient-sharing networks and the cost and intensity of care in US hospitals

BACKGROUND

There is substantial variation in the cost and intensity of care delivered by US hospitals. We assessed how the structure of patient-sharing networks of physicians affiliated with hospitals might contribute to this variation.

METHODS

We constructed hospital-based professional networks based on patient-sharing ties among 61,461 physicians affiliated with 528 hospitals in 51 hospital referral regions in the US using Medicare data on clinical encounters during 2006. We estimated linear regression models to assess the relationship between measures of hospital network structure and hospital measures of spending and care intensity in the last 2 years of life.

RESULTS

The typical physician in an average-sized urban hospital was connected to 187 other doctors for every 100 Medicare patients shared with other doctors. For the average-sized urban hospital an increase of 1 standard deviation (SD) in the median number of connections per physician was associated with a 17.8% increase in total spending, in addition to 17.4% more hospital days, and 23.8% more physician visits (all P<0.001). In addition, higher "centrality" of primary care providers within these hospital networks was associated with 14.7% fewer medical specialist visits (P<0.001) and lower spending on imaging and tests (-9.2% and -12.9% for 1 SD increase in centrality, P<0.001).

CONCLUSIONS

Hospital-based physician network structure has a significant relationship with an institution's care patterns for their patients. Hospitals with doctors who have higher numbers of connections have higher costs and more intensive care, and hospitals with primary care-centered networks have lower costs and care intensity.

Relationship between quality improvement processes and clinical performance

OBJECTIVES

To examine the association between performance on clinical process measures and intermediate outcomes and the use of chronic care management processes (CMPs), electronic medical record (EMR) capabilities, and participation in external quality improvement (QI) initiatives.

STUDY DESIGN

Cross-sectional analysis of linked 2006 clinical performance scores from the Integrated Healthcare Association's pay-for-performance program and survey data from the 2nd National Study of Physician Organizations among 108 California physician organizations (POs).

METHODS

Controlling for differences in PO size, organization type (medical group or independent practice association), and Medicaid revenue, we used ordinary least squares regression analysis to examine the association between the use of CMPs, EMR capabilities, and external QI initiatives and performance on the following 3 clinical composite measures: diabetes management, processes of care, and intermediate outcomes (diabetes and cardiovascular).

RESULTS

Greater use of CMPs was significantly associated with clinical performance: among POs using more than 5 CMPs, we observed a 3.2-point higher diabetes management score on a performance scale with scores ranging from 0 to 100 (P <.001), while for each 1.0-point increase on the CMP index, we observed a 1.0-point gain in intermediate outcomes (P <.001). Participation in external QI initiatives was positively associated with improved delivery of clinical processes of care: a 1.0-point increase on the QI index translated into a 1.4-point gain in processes-of-care performance (P = .02). No relationship was observed between EMR capabilities and performance.

CONCLUSION

Greater investments in CMPs and QI interventions may help POs raise clinical performance and achieve success under performance-based accountability schemes.

"Virtual" health care organizations and the challenges of improving quality

This article examines the challenges of improving health care quality continuously within and across "virtual" provider organizations such as independent practice associations and physician-hospital organizations. It draws on recent research and theory about interorganizational networks in other fields to develop recommendations for securing physicians' commitment to quality improvement strategies in today's health care environment.

Using compensation to improve primary care

Progressive primary care networks are now placing significant portions of physician salaries at risk by linking compensation to quantifiable measures such as net medical revenue (collections), reduced practice expenses, cost and utilization, quality of care and patient satisfaction. For most networks, a combination of productivity increases and expense reductions are critical to ensure financial survival. This case study illustrates how one network's unique incentive compensation program targeted higher productivity levels by incentivizing desirable behaviors.

Providers develop health plan to manage Medicaid patients without woes of HMOs

Managing Medicaid lives without HMOs. Providers in Pitt County, NC, have developed their own kind of managed care plan that brings together traditional Medicaid providers with private physicians seeking to improve care quality and patient access. Providers in the plan hope it can keep commercial HMOs out of the local Medicaid business.

Risk contracting calls for more use of disease management

This is the second of a series on how PHOs, IPAs, and other provider groups can manage a population of patients. The August issue of PHO Advisor included stories on managing Medicaid populations under risk contracts and establishing wellness programs.

Practice buyout: structuring the right deal

Hospitals and physician practice management companies are making offers to many group practices. It's important for group practice managers to know what to look for if a buy-out deal is offered. First, make sure the proposed partner will invest in front-line medicine and has stable management. Secondary considerations include: making sure buyer and seller goals align, accurately projecting capital needs and who will pay for them, guarding against provider overcapacity, clearly delineating parameters for control and limiting bureaucracy.

Clinical improvement: commentary on developing healthy physician-hospital relationships

Central to the success of clinical improvement programs is the degree to which hospitals and physicians can work together to achieve mutually beneficial goals. The purpose of this article is to provide a clear understanding of what is ultimately required for hospitals and physicians to form constructive relationships that deliver greater value to the marketplace.

Super PHOs provide clout and added efficiencies

Joining or forming a super PHO can increase the attractiveness to payers through broader geographic coverage and also generate administrative efficiencies for the individual PHOs. The key is to make sure the organization adds value to the managed care product and is not just a cartel to leverage payers.

Going global puts everyone on same incentive page

Payment schemes vary widely among hospitals and physicians, and one of the key goals of a PHO is to make payments equitable. One method of doing this is bundling services under a global pricing structure, which helps align incentives for both sets of providers. The result often is greater medical and financial efficiencies.

Benchmarks of successful physician-hospital organizations

In recent years, there have been a proliferation of physician-hospital organizations (PHOs) in the medical community across the country. To date, many of them have been ineffective with unproven track records. This article will explore some of the benchmarks of successful PHOs.

Self-regulation: the true key to success of physician-directed networks

The purpose of regulation is to promote uniformly high quality health care at a reasonable cost. The purpose of self-regulation is to make regulation more acceptable to the network physicians and create an atmosphere of continual improvement in bedside care. Interviews with medical directors of group practices, independent physician associations, managed care plans, national specialty networks, and physician-hospital organizations were used to learn what methods of self-regulation are popular and effective.

Managing underwriting risk in capitated provider groups

Physicians working under capitated arrangements must provide quality care and make money, i.e., manage the underwriting risk. Sometimes those ends can seem to be contradictory. To use capitation as a tool to provide cost-effective and quality health care, it behooves the physician to know what forces are at work that influence the results of this capitated environment. Several of those areas are under control of the physician directly and others are not. The physician must know what he or she can control and what cannot be controlled.

Blurred boundaries: state regulation of PHOs

Health plans that look alike to patients don't all have to meet the same standards for quality of care, benefits, and solvency. A recent GHAA 50-state survey looks at the regulation of one of the newer health plan models--the PHO.

Don't ask the question if you don't want to know the answer

Consultants can and do play many different roles for the client that hires them. In many cases, it is not as simple as it may appear in terms of laying out the problem and then letting the consultant you have contracted with either solve it for you or present you with options from which to pick the best solution. The retaining of outside expertise is usually done for one or more of the following reasons (by no means inclusive): Lack of "in-house" manpower or time to deliver a product. The need for an external expert to bring credibility to the project;. Getting someone outside your organization to deliver unpopular or bad news. Genuine interest in the independent findings and recommendations of the consultant. Whatever the motivation for seeking the advise of outside counsel, be sure you are prepared for the answer they may give to the question you have asked.

Purchasers look at physician hospital organizations

Business leaders are finally seizing the opportunity to shape the future of this country's health care delivery system. One such system could be new, community-based alliances known as physician hospital organizations.