Physicians Band Together To Cut Costs, Improve Quality of Care

Fair disclosure, both Dr. Bonvicino and I work with Osler Health IPA, so we have a dog in this hunt. The quarry, however, is the real story worth telling.

Our conviction that fundamental changes in the delivery system initiated and managed by physicians, particularly primary-care physicians, represents the only true solution to our country’s healthcare woes is well documented.

Still, for some the proof is in the pudding. Here's one example of how physician collaboration and a shared mission promises to dramatically improve healthcare for the better.

The story begins four years ago when physician led software company MDclick, Inc. successfully developed the means to close gaps in care and focus on stalling or reversing the degenerative effects of chronic disease. The company did this by dynamically stratifying complexity and enabling physician focus on the most complex cases, leaving maintenance to nurse practitioners under physician supervision.

MDclick’s physician leaders recognized that actually doing this effectively demanded capabilities well beyond the Patient-Centered Medical Home concepts of care coordination and EHRs, which they helped to formulate. It required a means to take the data from EHR systems and to convert it into usable, actionable information by stratifying risk and disease, providing meaningful analytics, and creating a tool transforming physicians from service providers to clinical managers.

What’s more, it had to be interoperable with other EHR systems used by the specialists and allied health providers to which primary-care practices referred. That would keep everyone on the same clinical page, communicating, and forming an interconnected system of virtual narrow networks, or, medical neighborhoods.

The first medical neighborhood, Heights Medical in Hasbrouck Heights, N.J., was the testing ground, and, here’s where the story gets interesting: Using CMS provided statistics for Heights’ ACO attributed patients, Heights cut spending over average Medicare by over 36 percent in 2012. Performance improved to over 58 percent in 2013. Over six million dollars in two years, two-thirds of the savings generated by the entire ACO’s tens of thousands of patients with 734 patients, with improved outcomes, quality, service, and patient satisfaction.

Realizing that success could be repeated in other primary-care based medical neighborhoods and interlinked using the MDclick system to form a broad provider network, Osler Health IPA was formed to integrate MDclick tools with its practice-based solutions. This makes sense because the system allows for central oversight from a single patient to population-based disease strata, parsed by physicians to payers, tracking performance, and allowing gaps and weaknesses to be identified and addressed.

Adding capabilities to enhance performance from medication management to patient personality typing, behavioral health, and more delivers sustainable, long-term results by cutting waste early on and improved population health status later on.

The end result: The next generation of population health well beyond coordinating care to organizing care, managing care over entire populations, one patient at a time, by enabling physicians to work as a team using shared best practices.

The further concept is to be hospital agnostic, but not value agnostic. The best care at the right place and time at the optimal cost. Hospitalizations, ED visits, procedures, and diagnostics are not denied or rationed. They are treated as investments in overall health status instead of the consequences of fragmented care.

Obviously, the financial rewards from gain-sharing and risk assumption from double digit reductions in spending on such a scale are unprecedented and important because they are game-changers where everyone wins. Success in reducing spending is not reliant on reducing prices or muscling payers for higher reimbursements, but by decreasing utilization organically, making it less necessary by improving population health status and sharing or keeping the savings.

How much? A cohort of just 40,000 commercial patients over 80 primary-care physicians equates to about $168 million in premiums. A 20 percent reduction in spending over premium split with the payer nets $16.8 million, and around $9.25 million for net distributions to participants after expenses and retentions, or over $63,000 per primary-care physician and over $10,500 for each provider, after reasonable fees for services.

The real winners are the patients, in quality of life, lower out of pocket costs, and eventually, premiums.