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Physician engagement strategies using Clinical Integration (CI) have been identified as a feasible yet legal means of demonstrating better value for each healthcare dollar. The present fee-for-service payment system rewards “volume” over “value”. Physicians and other stakeholders tend to be paid for how much they do rather than how well they do it. On the contrary, clinical integration programs are designed to control costs and achieve the desired “value” by engaging physicians to help find ways to decrease clinical practice variation, improve preventive care, decrease wastes, increase efficiency, and create better management of chronic disease.
An effective Clinical Integration program calls for physicians to develop active and ongoing clinical initiatives that are designed to control costs and improve the quality of health care services. CI programs demonstrate how independent physicians on the medical staff of the same hospital or hospital system can join together in an organization that allows them to: (1) identify and adopt clinical protocols for the treatment of particular disease states, (2) develop systems to monitor compliance with the adopted protocols on both an inpatient and outpatient basis, (3) collaborate with a hospital or hospital system to encourage compliance with inpatient performance improvement processes and protocols, and consequently (4) enter into physician-directed "pay-for-performance" and other contractual arrangements with health plans in a way that financially recognizes the physicians' efforts to improve health care quality and efficiency.
St. Vincent’s has had a Physician-Hospital Organization (PHO) since the mid-1980s. However, over the past 15 years, it had been largely dormant. The PHO was called Preferred Care, Inc., and was established to deal with the managed care risk contracts and capitation of the day. Upon the advice of consultants, it was decided that this existing PHO structure logically should be the backbone of the new endeavor. A new Steering Committee of enthusiastic physicians was formed in February 2011. This group met monthly to transition the PHO into a more contemporary alignment strategy. The resulting endeavor was renamed the St. Vincent’s Physician Alliance, and the decision was made to forge ahead with the development of a Clinical Integration program. A new Operating Agreement was drafted and by January 2013, all physician members joined the STVPA by signing new Provider Agreements.