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Clinical Integration: The Strategic Why and the Tactical How. HFMA West Virginia Chapter. September 25, 2014.

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clinical integration the strategic why and the tactical how
Clinical Integration: The Strategic Why and the Tactical How

HFMA West Virginia Chapter

September 25, 2014

valence health lori fox ward rn bsn


Valence Health – Lori Fox Ward, RN, BSN
  • Technology-enabled services since 1996
  • National presence with 500 employees, 4 offices
  • Serve IDNs, IPAs, PHOs, ACOs
  • Serve 39,000 physicians, 120+ hospitals
  • Support nearly 20 million patients
  • Privately held
  • 35% growth in 2013

Accountable Care

Clinical Integration

Population Health

  • Vice President of Strategic Initiatives for Valence Health
  • Has 20 plus years of experience in the managed care industry working with providers and health plans designing Clinically Integrated Networks and implementing Value-based contracting arrangements 
market trends for hospitals and physicians
Market Trends for Hospitals and Physicians



  • Real income has not increased in 30 years, particularly in Primary Care
  • Unfair negotiations with Payors
  • Pressures to report quality and cost of care
  • Difficult to remain independent
  • Physicians organizing to manage populations
  • Increasing Medicaid enrollment
  • Mandated Managed Care penetration
  • Pressure to demonstrate quality
  • Pressure to manage populations; emphasis on wellness and keeping patients out of the hospital
areas of vulnerability driving change
Areas of Vulnerability driving Change
  • Medicaid expansion
    • New populations in 2013 and further expansion in 2014 may create downward pressure on rates and utilization
  • Managed Care Plans attempting to reduce costs by:
    • Reducing inpatient utilization
    • Reducing ER utilization
    • Care provided at lowest cost option
  • Health Insurance Exchanges
    • Shift commercial enrollment into new products with potentially different/lower reimbursement
  • Increased Provider competition
    • Consolidation
    • Local/regional/national competitors
  • Pricing structure
    • Greater price sensitivity for patients/families
    • Physician incentives to direct care to lower-price alternatives
how systems are responding
How Systems are Responding

Increasing financial opportunity and alignment

















clinical integration as the foundation
Clinical Integration as the Foundation

Progression to new models

Positioning for the future

Clinically Integrated:Delivering results

Clinically Integrated:Can begin contracting

Population Management: Accountable Care Organization; Bundled Payments; Value-Based Care


Delivery SystemImprovement

Clinical Integration Program

Establish Structure & Network

Information Technology

what is a clinically integrated network
What is a Clinically Integrated Network?

A Clinically Integrated Network (CIN) is an active and ongoing program to evaluate and modify practice patterns by the network's physician participants and create a high degree of interdependence and cooperation among the physicians to control costs and ensure quality

The program may include:

  • establishing mechanisms to monitor and control utilization of health care services that are designed to control costs and assure quality of care;
  • selectively choosing network physicians who are likelyto further these efficiency objectives; and
  • the significant investment of capital, both monetary and human, in the necessary infrastructure and capability to realize the claimed efficiencies.”
why pursue clinical integration improve physician alignment and achieve the triple aim
Why Pursue Clinical Integration: Improve Physician Alignment and Achieve the Triple Aim
  • Ties physicians closer to hospital and fosters collaboration to increase quality and efficiency
  • Presents a powerful business model to thrive in the advent of consumerism, pay-for-performance, accountable care, and quality report cards
  • Leverages existing efforts (e.g. PCMH)
  • Allows hospitals to legally provide additional office practice support to CIN member physicians beyond just managed care contracting:
    • IT system infrastructure
    • Insurance
    • Group purchasing discounts
  • Allows provider networks that include independent physicians to collectively negotiate with health plans without FTC scrutiny


Improved quality and patient experience


Better health outcomes


Reduced per capita healthcare costs

legal analysis and options
Legal Analysis and Options
  • Utilize up-to-date FTC and DOJ guidance
  • Organize in a structure that supports program objectives
  • Other Considerations:
    • Ancillarity: Is joint payor contracting reasonably necessary to the achievement of cost savings/quality goals?
    • Market dominance: Does the CIN lock up a disproportionate share of the providers in any specialty/market?
    • Health Insurance Portability and Accountability Act (HIPAA)
    • Program-specific restrictions for ACO and state ACE/CCE initiatives
physician governance
Physician Governance
  • Physician leadership and engagement are key
  • Diversify clinical integration governance committee; include physicians that represent different perspectives
  • Create an imperative; a new vision
  • Leverage physician leaders and champions in the community
  • Include the “difficult” physicians
  • Physicians and hospitals need to “play nice” in the sandbox

Create a Winning Team

alignment with key physicians requires balance between value drivers
Alignment with Key Physicians Requires Balance Between Value Drivers

Engaged, collaborative, aligned physician network



Qualities the CIN Needs

(Recruitment Criteria)

  • High-quality physician groups with strong values
  • Good cultural fits and appetites for innovation
  • Experience in value-based models
  • Groups willing and able to share data; have effectively adopted an EHR
  • Eagerness to help build and shape the CIN, including physician (especially PCP) participation in leadership
  • Broad enough geography and PCP/Specialist coverage to provide care across the continuum

Benefits the CIN Offers

(Value Proposition)

  • Increased access to continuum of care data
  • Performance & benchmarking data
  • Promotion of a quality brand
  • Preserve reimbursement opportunities
  • More voice in market
  • Improved PCP-Specialist communication
  • Improved coordination of care and services for patients
  • Optimize current IT capabilities
  • Maintain or enhance patient volume




conditions and requirements of participation
Conditions and Requirements of Participation

Practice Performance

  • IT solution
  • Training and onboarding
  • Physician change management
  • Staff change management

Care Delivery

  • Best practices
  • Quality initiatives
  • Care mgmt.


  • Performance
  • Data sharing
  • Governance
  • Credentialing

Participation Agreement

  • Quality and citizenship measures
  • Qualifications
  • Technology requirements
  • Text
  • Text
  • Text
  • Text
  • Mitigation of Barriers
  • Physician designed criteria
  • Physician designed policies and best practices
  • CIN Quality support
  • CIN IT support

Collaborative CIN Design

clinical and financial data integration1
Clinical and Financial Data Integration
  • Ability to analyze quality, utilization and cost
    • Identify high cost, high risk patients
    • Target over-utilization; high cost services
  • Comprehensive patient data, viewed across providers
  • Data needs to be actionable and as close to real-time as possible
  • Use data that is most readily available
  • Physician performance against peersand external targets/benchmarks
  • Tools to support populationmanagement

Data Integration: Population Management

  • Population Management Snapshot
quality performance measures
Quality & Performance Measures
  • Clinical quality and operational improvement projects are necessary components of a CI program
  • Define how quality is measured; adopt and promote EBGs
  • Performance initiatives are meaningful; span across specialties and sites of care
  • Develop care programs to address clinical priority populations
  • CIN may need to support care redesign:
    • Increase quality
    • More effectively manage costs
    • Reduce variation and eliminate unnecessary waste
    • Improve care delivery at the local level
  • Remediation plan to address poor performers is required
contract negotiations
Contract Negotiations
  • A network of providers may be attractive to payers
  • Although the sole purpose for creating a CI network is not negotiating better rates with payers, CI Networks are rewarded for demonstrated value
  • Develop a strategy to take to the payers to promote consistency
    • Improved/enhanced reimbursement
    • Standard quality measures
    • P4P vs. Shared savings / shared risk
  • Challenges/Issues:
    • Physicians giving contracting authority to the CIN
    • Exclusivity vs. non-exclusivity
    • Opt-in / Opt-out
reward for performance
Reward For Performance
  • Examples of contracting models that reward performance:
    • Enhanced base rates - increased fee-for-service rates based on expected performance
    • PCP Engagement fee - incentive for increased care coordination activity
    • Performance incentives- incentive payments made for performance improvement initiatives
    • Shared savings- savings shared based on a reduction in the cost of care
  • These may be a starting point to move towards greater levels of financial accountability
creating incentives for change
Creating Incentives for Change
  • Align Incentives Program Assumptions:
  • Modify compensation to reward desired outcomes
  • Compensation must be altered for a significant portion of a practice for physicians to take notice
  • Incentives should mimic what you are trying to accomplish at each phase
  • Reduce complexity of distribution methodology
  • Increase transparency across network
    • Set tangible, measureable targets
educate your constituents
Educate Your Constituents




Shared Savings




Healthcare is an alphabet soup

employ a variety of methods
Employ a variety of methods


In Person


  • Phone calls
  • Direct calls
  • Conference calls
  • Webcasts
  • Personalized emails
  • Email blasts
  • Electronic newsletter
  • One-on-One meetings
  • Town hall meetings
  • Focus Groups
  • Demonstrations
  • Practice Manager meetings




  • CIN/hospital website
  • Applications (phone, tablet)
  • Webinars
  • YouTube
  • Social media
  • Physician portal
  • Medical conferences
  • CME events
  • Summits
  • Newsletter
  • Brochure
  • Pre-sale packet
  • Recruitment packet

A combination of these media will be used to reach each target audience

critical success factors best practice
Critical Success Factors / Best Practice
  • Develop a value proposition for all stakeholders
  • Communicate goals early and often
  • Consistent and ongoing leadership commitment through the full implementation of the clinically integrated network
  • People may be doubtful, cynical, etc. – engagement in the process is key to obtaining commitment
  • Help physicians achieve maximum rewards



Thank You !

To learn more about Valence Health’s capabilities,

Contact: Lori Fox Ward at 312-277-6304 or