10 keys to successful integrated systems

Involve physicians, benchmark

If you've got lots of managed care, lots of competition, and lots of pressure to cut costs in your market - and you're not already part of a system - it's time to get busy. Experts agree it will be just short of impossible for an independent hospital to survive in the coming years. But it's not enough to form alliances or purchase provider units - you've got to do some serious work to achieve the desired results.

"People are at all different stages around the country," says Matt Kerr, marketing manager at Kansas City, MO-based Hoechst Marion Roussel, publisher of Integrated Health Systems Digest. "You can't skimp in any area. You might have a system that accepts financial risk and has enough population to spread that risk around, but they have no physician leadership on the governance board, so they're always fighting with the hospital administrators. That system is only going to go so far."

Here's a compilation of advice from Kerr; Stephen Shortell, author of Remaking Health Care in America: Building Organized Delivery Systems (San Francisco: Jossey-Bass Publishers; 1996) and Blue Cross of California distinguished professor of health policy and management at the University of California, Berkeley; and David Nash, associate dean and director of health policy and clinical outcomes at Thomas Jefferson University Hospital in Philadelphia:

1. Make sure you have a conceptual map and a solid understanding of what integration is all about. Develop a strategy for your process.

2. Develop a strong central governing body with support from all components of care. Have a blend of perspectives in the top leadership. If you have a nonphysician CEO, for example, put physician executives right underneath in your organizational structure. And make sure your management provides committed leadership for the project.

3. Increase physician leadership and participation in the decision-making processes. Cultivate physician champions and have physicians represented at senior levels.

4. Make significant investments in information technology. You need a sophisticated information system that can integrate financial, operational, clinical, and managerial data and deliver the information in real time to any site in the system. You need the ability to track patients' data from site to site. This is one of the main sticking points for systems: 55% of 105 reporting highly integrated systems in the Integrated Health Systems Digest had intranets that connected users either through a local area network that links users within one facility or a wide area network that links users of more than one facility. Just 20% of those systems had the ability to electronically link all providers simultaneously to a patient's most up-to-date medical record.

5. Establish a complete one-stop shop so you can track patients' health status. If a patient treated in your hospital for an acute illness is discharged to a long-term care facility, and that's not part of your system, you won't be able to demonstrate to an employer or payer that you improved the patient's outcome more than your competitor did.

6. Put in place incentives such as performance appraisals and rewards to motivate collaboration. Align incentives so physicians are measured the same in outpatient and inpatient settings. Align the hospital so it's more concerned with the best outcome than with getting patients out the door as quickly as possible. Pay in a similar fashion - based on outcome, not the ability to cut costs.

7. Accept financial risk and establish the ability to contract based on a single signature.

8. Coordinate processes to ensure a smooth transition of patients along the continuum and to align utilization and cost management objectives.

9. Document improvements in outcomes. If you can't track your progress, you won't get far.

10. Benchmark. Providing your physicians with evidence of what other systems are doing successfully will go a long way toward getting their cooperation. n