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KSM Blog | Katz, Sapper & Miller CPA

Institute Development: Creating Meaningful Partnerships Between Hospitals, Physicians

Posted 12:00 PM by

Healthcare reform is driving systemic change. Providers are now compelled to completely rethink how patient care is delivered, and that means working together in new, different and more productive settings. As a result, hospitals and physicians need to develop collaborative working relationships in order to take steps – together – toward the ultimate goal of achieving market success and improving the health of the community.

There are several steps along the path to clinical and market success. One such building block is developing an “institute” focused on a specific clinical specialty, which create a meaningful partnership between hospitals and physicians. A key component of any care redesign and clinical integration activity is how well it meets the Institute for Healthcare Improvement’s Triple Aim Initiative of:

  • Improving patient experience
  • Improving population health
  • Reducing per capita cost of care

A properly designed and executed institute will enable market success for the founding physicians and hospital, as well as become the launching point for success in population health.

Developing Goals and Defining Services

Clinical institutes create more efficient systems of care. They focus on creating comprehensive programs that grow based on exceptional quality, satisfaction and providing value-based care delivery.

A very early step in the institute-development process is for physicians and hospital administrators to co-develop a vision of the institute’s goals and define the services. Once those are established, the parties need to define what success looks like by asking, “What are the drivers of a successful institute?”

Using Triple Aim Goals as Drivers of Success

While institutes can take many forms and structures, they often measure success along three dimensions:

  • Improving population health – deliver a high-quality clinical product with excellence in outcomes.
  • Improving patient experience – provide a comprehensive and accessible service spanning the care continuum that delights the customer.
  • Reducing cost of care – realize the synergy of partnership to improve the value proposition to payers by reducing costs and eliminating waste.

These are the Triple Aim objectives. A successful institute is positioning itself for success in population health. 

Redesigning Clinical Functions

Many hospital leaders have realized that the incremental improvement of current processes is not sufficient for today’s challenging healthcare market. In many cases, the current process must be completely redesigned and reconstructed to achieve substantial success. To effectively restructure these clinical functions, hospital administrators, clinical leadership and physicians must be actively engaged and committed to the process. Physicians want to be meaningfully involved in clinical decision making, and, to be successful, hospitals need physicians to be actively involved.

While physicians are trained to make methodical yet timely decisions, hospitals are often less flexible (and therefore slower to make decisions) due to their size and structure. Managing the pace of change is an important consideration for institutes. We recommend establishing an early commitment to these values that will move the institute forward:

  • Improvements to quality
  • Patient, physician and staff satisfaction
  • Improvements to leadership and decision making
  • Physician and  group practice involvement
  • Clinical excellence
  • Higher value care

Creating Value

Institutes are a great way to foster productive physician-hospital relationships. When properly structured, they allow hospitals and physicians to work together in a more collaborative environment without formal integration (e.g., selling practice or employment). A high-performing clinical institute will create value and benefits for patients, hospitals, physicians and the community.

About the Author
John Martin is managing director of healthcare consulting with Katz, Sapper & Miller's Healthcare Resources GroupJohn leads a team of healthcare consultants who provide financial, strategic and operational solutions for hospitals, health systems and physician groups. Connect with him on LinkedIn.

 

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