Health Systems Direct

Perspectives

“Collective Autonomy -- taking another whack at medical management, or, what health plans and payers can do to help their physicians, and themselves”

By
Bruce Taffel, MD
George G. Karahalis, FACHE

Health Plans, hospitals, governments, employers, integrating health systems and even physician organizations have taken a turn at the improvement of clinical resource-use and quality. They all sought to “manage the physician workforce” in pursuit of these goals. Few have succeeded.

Of late, because of increasing costs and urgency to produce positive margins, healthplans and government have taken the step of offloading risk onto providers, without benefit of creating a sustainable structure. To be sustainable, the structure must simultaneously facilitate clinical autonomy while supporting knowledgeable, collective management action by clinician leaders and managers. The target: cost effective, clinically appropriate and effective health services.

Current organizational structures and management style hinder action To illustrate: most health plans are large organizations. Their orientation is to direct action down within their structures, or out to independent contractors like the physician. But, physicians are not only uniquely and fiercely independent, they strive to keep their physician-patient relationship out of the hands of “the bureaucrats and bean- counters.” Indeed, patients increasingly demand “hands off.” Their politicians and employers hear the roar, but seem powerless to bring sanity to the healthcare market.

Recognition and acceptance of the roles of others The solution lies somewhere in the organization and, yes, better coordination of health services. It must include an acceptance by both physicians and others of the leadership and management role of the physician, as well as the role of health care administrators to support the physicians’ initiatives. Both conditions must exist at the same time to achieve success. The alternative, current methods, in our opinion, have only produced discounting. Changes made to adjust clinical decisions rarely created more efficient treatment and administrative coordination – patient or case management protocols.

In fact, recent increases in the “medical loss ratio” (the costs of the clinical component of premium) prove our argument and have exceeded collected premiums by as much as 150%. A significant part of expense growth is the duplication of administrative structures needed by, for example, an IPA or physician group taking a global capitation. Both the HMO and physicians must keep similar data to manage their respective roles. But, they may be overlooking the more obvious action of reducing administrative costs by closer working relationships.

For several years through 1998, HMOs had been unable to raise premium revenue to compensate for increased cost. Premium had been frozen by a “defined contribution” approach. Many employers (e.g., ERISA plans) and governments (for Medicare and Medicaid populations) found this approach the quickest, “meat-ax” solution. This yielded negative margins for health plans and pressure from Wall Street for results. But, the plans described no strategy or tactic for realistically “managing the physician workforce” in a way that would produce lower administrative costs or medical loss ratios.

Necessity may be the “mother of invention,” but capital investment and a change in approach are critical As Health plans and HMOs are forced to absorb losses or attempt to increase premiums, they are discovering that the initial strategies to fix costs with discounted fees, transferred risk and denied services are not long term solutions. In fact, these approaches only tend to reinforce the perception that health plans are self-contained fortresses, aloof from patients and providers.

As a result, physicians and consumers accuse managed care health plans of placing cost containment above concern for appropriate care. Faced with this backlash, many payers now find themselves at an impasse. Where do they go from here? How can they win back health care’s other stakeholders, while, at the same time, legitimizing managed care and making it profitable?

History IS a guide
Health care professionals and industry experts recognize the well-established processes for successfully managing care – continuous quality improvement, guideline development, benchmarking, education and feedback. Nonetheless, these “genies” largely remain within their respective bottles. To achieve a new level of success, Health plans, HMOs and PSOs need to rethink their relationships with “clinicians” and should not think of them as “mere vendors.” They must break down the fortress walls and create symbiotic relationships with community providers, striving for mutual benefits and improvements in patient care outcomes.

Historically, the relationship between health plans and doctors has been littered with negatives. Declining reimbursement, poor claims processing, confusing rules, unwieldy and time consuming pre-authorization systems, “gag” clauses, muddled eligibility systems and incomprehensible benefits lead a long list. Certainly, physicians grumble about all of these. However, they are equally concerned over the perception that they are losing control over the doctor-patient relationship and abdicating their role as patient advocate, a function essential to inspiring confidence and patient compliance with treatment.

Management procedures and support, not clinical dictatorship
Managed care leaders agree that the enemy of efficient quality health care is unrestrained practice variance. However, controlling this variance with seemingly arbitrary rules and “canned” criteria from a “decision support” company only serves to alienate those whose behavior managed care seeks to modify. As highly trained professionals with strongly felt values concerning health care in their communities, physicians tend to resist centrally imposed (and contractually mandated) standards that have not allowed for input and ongoing involvement from local clinicians.

Health plans must standardize the process for community decision making rather than standardize clinical care. Therefore, the principal tools for positive change and integrated community decision making include:
    • the development and empowerment of physician leaders/managers,
    • the innovative use of accepted CQI tools and
    • the application of physician education linked to sophisticated data and outcomes feedback.

These form the basis of a strategy that encourages, what we call, collective autonomy. Collective autonomy is designed to integrate local physicians into the health plan’s fabric of clinical/management processes. The steps include:
1.Focus: Analyze utilization and key disease states; then target and prioritize community initiatives based upon the related cost of variance by specialty. For purposes of a pilot project, the health plan may select a specialty with the greatest opportunity for improvement (e.g., significant part of premium or significant “shock claim” impact or clinical-quality challenge).

2.Funding: Allocate capital and operations-funding of resources for supporting clinical/management staff.

3.Information systems: Dedicate sophisticated information management support, with complete and accurate encounter data.

4.Leaders: Enlist leaders in a targeted specialty from the practicing medical community. Use them to form a utilization/quality committee that elects a chair person. With the health plan’s resources and support, the committee will help design, approve and implement the specialty’s CQI and UM efforts, including policies, procedures, guidelines and precertification criteria.

5.Compensation: Establish payment for committee members, to compensate them for time away from patient care; make them specialty reviewers.

6.Physician managers: Hire the chair person as a part time specialty medical director, who will spend a day each week working with the plan’s Chief Medical Officer and specialty staff to lead specialty reviews, interventions and education.

In essence, the resulting structure forms a community based medical staff model for the health plan.

Past results as a guide
Multiple studies have shown that locally active opinion leaders are the most effective in moving their community peers toward behavioral changes. The collective autonomy structure therefore leverages that influence from its specialty physician leaders. For example, these doctors will build evidence-based guidelines, act as physician emissaries for dissemination, and provide a respected and authoritative community focus for their implementation. They may also participate in on-site “academic detailing”, visiting practices and linking peer comparison performance feedback and bench marking with best practices education.

    • A working example of this approach: A major payer with over 200,000 lives in Atlanta, Georgia developed a concept similar to the collective autonomy model. In this case, the health plan created a strong interdependency with a risk-delegated OB/GYN network. With the health plan’s support, the doctors produced a market based committee structure led by dedicated and respected community leaders. The doctors developed guidelines, a preauthorization plan and education programs. They also acted as expert reviewers, making recommendations to the plan’s medical director and calling attending physicians to discuss appropriateness of care.

    • The results were impressive: Within two years, the cesarean section rate dropped from 24% to 17% and the V-BAC (Vaginal Birth After C-section) rate doubled. Prematurity rates fell by 58% while rates for hysterectomy declined to half of the national average. These results had dramatic economic ramifications that helped to justify the front-end and administrative investment. More importantly, the approach demonstrated a trusting relationship between physicians and the health plan. Interestingly, physicians saw these benefits, primarily, as byproducts of their efforts to improve quality. Moreover, they took pride in being a part of an organization that demonstrated a caring attitude toward their community.

In summary
    • Engender trust by integrating processes, creating sustainable frameworks for physician management and clinical leadership.

    • Engage the natural tendencies of clinicians and reward them as leaders/managers for time spent away from clinical duties.

    • Leverage physician opinion leaders to reduce utilization and costs by controlling clinical variance and increasing quality.

    • Develop more consistent and comprehensive data resources.

    • Recognize that creating a sustainable framework means that solutions are community driven by patients, employers and providers and that clinical care will reflect locally defined, clinically-driven “best practices.” In other words, prepare to be creative and tailor the result to the situation.