Physician Integration & Alignment : IPA, PHO, ACOs, and Beyond

254 Pages·2012·4.15 MB·English

by  Todd

Business & Management / Healthcare Financial Management & Leadership
T Physician Integration
o
Today, with physician and hospital reimbursement being cut and tied to quality
d
incentives, physicians and health plans are revisiting the concept of integration.
d & Alignment
Payers are demanding that the industry do more with less without sacrificing quality
of care. As a result, physicians again find themselves integrating and aligning
with hospitals that have the resources they lack or must develop together.
P IPA, PHO, ACOs, and Beyond
Written by an acknowledged expert in the field of physician integration and
h
managed care contracting, Physician Integration & Alignment: IPA, PHO,
y
ACOs, and Beyond examines physician integration and alignment in the current
s
healthcare market. It outlines the common characteristics of integrated groups and
i
various organizational structures and also explains how you can avoid making the
c
same mistakes of the past. Filled with suggestions and ideas from successfully
i
integrated practices, the book: a
n
• Identifies industry drivers for the resurgence of integrated models
and the need for aligned models
I
• Provides a look at the common characteristics of integrated and n
aligned groups and how the components can work together
t
• Discusses antitrust and other regulatory concerns present when e
considering the right organizational and management structure g
r
• Offers time- and money-saving checklists, lessons learned, models,
a
and templates—saving you thousands of dollars in consulting fees
t
i
Maria K. Todd provides readers with the vision and tools needed to organize o
their business entities in a manner that will maximize economic clout and provide n
quality of care for both the hospital and physician group. This much-needed resource

includes helpful insights on topics such as declining physician reimbursement, &
declining margins, physician shortages, physician–hospital competition, rising

practice investment requirements, the return to capitation as a payment mechanism, A
and recent changes in the relationships between physicians and health systems.
l
i
Maria currently is the principal of the largest globally integrated health delivery g
system in the world with over 6,000 hospitals and 85,000 physicians spanning 95 n
countries. She has developed more than 200 integrated and aligned IPAs, PHOs, m
ACOs, MSOs and healthcare clusters in her career.
e
n
K10664
t Maria K. Todd
ISBN: 978-1-4398-1308-9
90000
www.crcpress.com
9 781439 813089
www.productivitypress.com
K10664 cvr mech.indd 1 9/27/12 2:26 PM
Physician Integration
& Alignment
IPA, PHO, ACOs, and Beyond

Physician Integration
& Alignment
IPA, PHO, ACOs, and Beyond
Maria K. Todd
CRC Press
Taylor & Francis Group
6000 Broken Sound Parkway NW, Suite 300
Boca Raton, FL 33487-2742
© 2013 by Taylor & Francis Group, LLC
CRC Press is an imprint of Taylor & Francis Group, an Informa business
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Version Date: 2012928
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Contents
Acknowledgments ..................................................................................................xiii
About the Author .....................................................................................................xv
Introduction ............................................................................................................xvii
Section i introduction to Provider organizations
Chapter 1 The Goals and Objectives of Physician Alignment and
Integration: Form Follows Function .....................................................3
Chapter 2 Independent Practice Associations (IPAs) .........................................11
Second-Generation IPAs ....................................................................17
Step 1 .............................................................................................18
Step 2 .............................................................................................19
Step 3 .............................................................................................19
Step 4 .............................................................................................19
Financing and Managing the IPA ......................................................19
Picking Your Consultants ...................................................................21
Operations Management for the IPA ..................................................21
Administrative Staffing for the IPA ..............................................22
Governance Issues for the IPA ......................................................22
Start-Up Capital .............................................................................22
Solvency Standards ........................................................................24
Steering Committee ..................................................................25
Bylaws Committee ....................................................................25
Membership Committee ...........................................................25
Utilization Management Committee ........................................25
Quality Assurance (QA) Committee .............................................26
Finance Committee .......................................................................27
Credentialing Committee ..............................................................27
Other Concerns Relevant to Prequalification for
Membership ...................................................................................28
Access Issues ............................................................................28
Medical Records Review ..........................................................28
Recertification and Recredentialing .........................................28
Grievance Policies ....................................................................28
Other Operational Issues ..........................................................29
v
vi Contents
Chapter 3 Physician Hospital Organizations (PHOs) .........................................31
PHO Revenue Allocation ...................................................................32
PHO Direct Contracting .....................................................................32
Negotiation and Projection Hindrances .............................................33
Differences in Administrative Style among Members .......................33
Managed Care Contracting with Payors ............................................35
Governance Issues: Control ................................................................35
Medicare Anti-Kickback and Practice Acquisitions ..........................36
Chapter 4 Accountable Care Organizations (ACOs) ..........................................45
Chapter 5 Management Services Organizations (MSOs) ...................................55
Three Basic Elements of MSOs .........................................................55
Section ii integrated Health Delivery System
Development
Chapter 6 Corporate Form: Myriad Choices ......................................................63
General Partnerships ..........................................................................63
Disadvantages of General Partnerships .........................................63
Limited Partnerships ..........................................................................64
Advantages of Limited Partnerships .............................................64
Disadvantages of Limited Partnerships .........................................65
Corporations .......................................................................................66
Advantages of Corporations ..........................................................66
Disadvantages of Corporations .....................................................68
The Subchapter S Corporation ...........................................................68
Disadvantages of S Corporations ..................................................69
Double-Taxation Considerations ........................................................70
The Limited Liability Corporation (LLC) .........................................70
Chapter 7 The Steering Committee Gets Busy: Step-by-Step Instructions
for What to Do and How to Do It .......................................................73
Steering Committee Task List ............................................................73
Background/Understanding of Task ..............................................73
Develop a Statement of the Committee’s Purpose ...................73
Approach ...................................................................................74
Development of the Shared Vision ...........................................75
Organizational Development of the IPA .......................................75
Contents vii
Organizational Development of the MSO Required of the
Steering Committee .......................................................................77
Market Focus .................................................................................78
Development of a Business Plan ....................................................78
Organizing the Steering Committee ..................................................79
Multi-Specialty IPA or PHO .........................................................79
Single-Specialty IPA or PHO ........................................................80
Management Services Organization (MSO) .................................81
Other Concerns of the Steering Committee ..................................81
Chapter 8 Guidance for the Utilization Management and Quality
Improvement Steering Committees ...................................................83
First Things First ................................................................................84
Utilization Management Program Outline ....................................84
Quality Improvement and Assurance Program .............................85
Activities to Study and Frequency of Each Study .........................86
Frequently Asked Questions by the Health Plans
(Don’t Be Caught Without An Answer!) ..................................86
Documentation Quality .................................................................87
Adverse Outcome Review .............................................................88
Chapter 9 Network Financial Management: The Intersection of Finance,
Utilization Management and Capitated Risk Management ...............91
Finance Reports ..................................................................................92
Utilization Management Reports .......................................................92
Additional Monitoring Reports ..........................................................95
Chapter 10 Provider Organization Credentialing and Privileging .......................97
Typical Managed-Care Provider Organization Representations
and Warranties ...................................................................................97
Provider Expectations ........................................................................99
Practitioner Requirements ..................................................................99
Non-Physician and Provider Requirements .....................................100
Credentialing Process .......................................................................101
Delegated Credentialing ...................................................................104
Acknowledgment ..............................................................................105
Chapter 11 Credentialing Committee’s Assignment: What to Do and How
to Do It..............................................................................................107
Due Diligence in Credentialing .......................................................108
Vicarious Liability .......................................................................109
viii Contents
Master and Servant Liability .......................................................109
Ostensible Agency .......................................................................110
Structuring a Good Credentialing Policy .........................................111
Provider Application for Credentialing ............................................112
General Information ....................................................................112
Licensing/Certifications/Registration Numbers ..........................113
Hospital Privileges .......................................................................113
Professional Liability Coverage (at the time this application
is completed) ................................................................................114
Disciplinary Actions ....................................................................114
Professional References ...............................................................114
Office Information .......................................................................114
Chapter 12 Antitrust Compliance Task Force: Understanding Antitrust
Concerns for Provider Networks ......................................................117
What Are the Antitrust Laws? ..........................................................118
Terms Used in the Guidelines ..........................................................118
Federal Guidelines of Antitrust Enforcement Policy
in Healthcare ....................................................................................121
Statement 4: Providers’ Collective Provision of Non-Fee-
Related Information to Purchasers of Healthcare Services .........122
Statement 5: Providers’ Collective Provision of Fee-Related
Information to Purchasers of Healthcare Services ......................122
Statement 6: Provider Participation in Exchanges of Price
and Cost Information ...................................................................123
Statement 7: Joint Purchasing Arrangements among
Healthcare Providers ...................................................................124
Statement 8: Physician Network Joint Ventures ..........................125
Use of the Messenger Model to Negotiate an Agreement with
a Payor ..............................................................................................125
Characteristics of the Arrangement .............................................125
Legality of the Arrangement .......................................................126
Variations on the Messenger Model .................................................126
Non-Integrated Network that Presents and Discusses Non-Fee
Related Information and Uses the Messenger Model for
Financial Arrangements ...................................................................127
Case Scenario ..............................................................................127
Legality ...................................................................................129
Variation on the Arrangement ................................................129
Legality ...................................................................................129
Variation on the Arrangement ................................................129
Legality ...................................................................................129
Qualified Managed Care Plans (QMCPs) ........................................130
How the QMCP Concept Came About ........................................130
Contents ix
Substantial Financial Risk Must Be Shared ................................132
Agency Analysis of Physician Network Joint Ventures that
Fall Outside These Antitrust “Safety Zones” ..............................132
Statement 9: Multi-Provider Networks ........................................133
Shared Substantial Financial Risk ...............................................133
No Sharing of Financial Risk ......................................................134
Rule of Reason Analysis ..............................................................134
Selective Contracting ..............................................................134
Messenger Models ..................................................................135
Useful Addresses and Telephone Numbers .................................135
Chapter 13 Business Plan Development .............................................................137
Model Business Plan ........................................................................139
Executive Summary ....................................................................139
Company Direction .................................................................139
Company Overview ................................................................140
Objectives ...............................................................................140
Capital Requirements .............................................................140
Management Team ..................................................................140
Service Strategy ......................................................................141
Market Analysis ......................................................................141
Customer Profile .....................................................................141
Competition ............................................................................141
Risk .........................................................................................142
Marketing Plan .......................................................................142
Marketing Strategy .................................................................142
Advertising and Promotion .....................................................142
Public Relations ......................................................................143
Financial Plan .........................................................................143
Conclusion ..............................................................................143
Financial Plan ..............................................................................143
Assumptions ...........................................................................143
Gross Profit Analysis ..............................................................144
Budget—Income Statements ..................................................144
Balance Sheets ........................................................................144
Cash Flows Statements ...........................................................145
Break-Even Analysis ...............................................................145
Capital Requirements .............................................................145
Use of Funds ...........................................................................145
Exit/Payback Strategy.............................................................145
Conclusion ...................................................................................146
Keeping Your Infant Business Competitive: Nondisclosure
Agreements.......................................................................................146
Sample Nondisclosure Agreement ..............................................146