Mission Critical: Physician Engagement in the Age of ACOs

Western Pennsylvania Hospital News 03.01.2011

By Henry Ross & Rochell Pierce

Hospitals and physicians have made strange bedfellows over the years, and it’s no wonder. Their respective cultures and needs couldn’t be more different. Physicians whether in a solo practice or large groups tend to function more as individuals, whereas hospitals and health systems function more as an enterprise.

Regardless of operating style both physicians and hospitals are in the midst of a sweeping payment reform that is impacting both of their business models. Traditionally physicians, for the most part, have been reimbursed by ‘fee for service’. Since the advent of DRGs (diagnosis related groups), hospitals, by and large, have been pushed more toward episodic care/case rates by both Medicare and private payers.

With the introduction of the Patient Protection and Affordable Care Act (PPACA) in March of last year we are now seeing both groups being moved to reimbursement models based on quality of outcomes and shared savings. At the forefront of this movement will be Accountable Care Organizations (ACOs), which is set to be the model for managing patients’ health and providers’ financial risk for care provided. While the demonstration projects are just getting underway, the simple truth is this: in the age of healthcare reform, hospitals and physicians will need each other more than at any other moment in American healthcare history.

Collaboration between physicians and health systems will become the single most important strategy both groups can undertake in order to secure their future and financial viability. In fact, many forward-thinking organizations are already engaged in this important endeavor. But how successful is your current physician relations initiative, and are you seeing a healthy return on investment? No single initiative deserves a strategic approach more than physician relations and engagement. In order to enjoy measurable results, healthcare organizations should ensure their physician relations solution includes the following critical elements in order to facilitate a meeting of the minds with their doctors:

1. Find the right physician relations manager. Because physicians can be a bit jaded when it comes to having outside representatives calling on them, credibility is key when stepping up outreach efforts. Organizations should find a physician relations champion who understands the nuances of healthcare delivery in both the office and hospital environments. The selected manager, who fills this very important role of liaison, should also have credibility with hospital departments which may need to respond to physician issues as they are identified and should be empowered to respond immediately to the most basic of issues. Another critical characteristic is impeccable follow-through. Uncovering critical issues impacting physician satisfaction is pointless if the manager does not successfully resolve – or at least address with hospital management – the complaints and suggestions expressed by doctors. Lack of closure on any outstanding issue virtually guarantees your liaison will not be granted a second audience. In short you need a sales person who is accountable.

2. Ask how you can earn more of their business. Splitters (physicians who divide their admission among multiple facilities) are not uncommon on any medical staff, especially where a number of hospitals stand in close proximity to each other. Physicians select a hospital for a variety of reasons, but it IS POSSIBLE to change admitting patterns. Hospitals need to qualify their physician prospects by determining which ones are splitters and have the highest potential to bring the most profitable book of business to their facility. That means doing the due diligence to determine existing referral patterns. Only then should you ask what it will take to have a doctor send more patients. It could be as simple as buying a new piece of equipment in the operating room, expanding diagnostic or treatment capabilities of an existing service line, or opening more block time for the surgeon – to developing initiatives that will drive favorably insured patients to their desired service lines. It is important to note: do not take your loyal physicians for granted. These are your best referral sources and you want to assure you maintain that relationship.

3. Ascertain the level of integration your physicians find acceptable.
While many physicians are not comfortable with the notion of employment by a health system, they will entertain models for closer integration and collaboration on managing hospital services and departments. This is not a discussion for a first visit. Only after your liaison establishes a level of trust — and figures out how closely aligned a doctor will consider being – can this subject be successfully broached. But determining potential alignment structures will be critical as health systems evolve into ACOs.

4. Maintain a data-rich tracking system.
No physician relationship management initiative can be effective without a database approach that allows the physician relations specialist to gather personal and professional data and track their every physician encounter. Your tracking system should allow for the input of resolved issues, as well as flag those that are still pending and require follow-up. It must also have the ability to track referral volumes. If these change, either up or down, there is the opportunity to proactively optimize or address.

5. Evaluate the success of your outreach program on a regular basis. Hospital leaders should evaluate the progress of their physician relations program at quarterly intervals, to ensure that the efforts are targeted to the right physicians and are driving bottom-line results. It is essential to confirm the alignment of economic goals – addressing what is important to the physicians and addressing how you help them achieve them i.e. by optimizing opportunities to engage new patients.

“Coming together is a beginning. Keeping together is progress. Working together is success”, famous words by Henry Ford.” In establishing a collaborative environment in support of your physician relationship management initiative, hospitals position themselves for a more successful transition to an ACO. This proactivity will help assure a positive evolution for both the hospital and their physicians as both parties realize the benefits of partnership.

Henry Ross is CEO and Rochell Pierce is senior vice president of physician relationship management at Aegis Health Group, which helps hospitals across the country to build lasting relationships with their two most important audiences – physicians and favorably insured consumers. More information is available at www.aegisgroup.com.

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