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How can independent practices stay in business without sacrificing their freedom?
Many independent practice owners today are in a difficult bind. They want to maintain their autonomy, but to survive they need greater resources to compete with hospital systems and large multi-specialty practices. Moreover, antitrust laws prohibit them from negotiating jointly to obtain better payer contracts.
So how can these practices stay in business without sacrificing their independence? One solution lies in forming or joining a clinically integrated network (CIN). These entities can negotiate payer contracts on behalf of their participants without violating antitrust laws. At the same time, they provide practices with many of the services and resources enjoyed by larger healthcare organizations.
One CIN that has enjoyed considerable success is the Independent Pediatric Collaborative of Long Island. Founded just two years ago, it has grown to include 10 practices and about 50 practitioners. The collaborative entered into several value-based payer contracts, and saved money for its practices by using its group purchasing power. through which group payer group purchasing powers.
To find out more about how CINs can help independent practices, Medical Economics spoke recently with IPCLI’s founders, George Roku, MD, and Juan Espinoza, MD. The interview has been edited for length and clarity.
Medical Economics: Describe clinically integrated networks and how they operate
Juan Espinoza, MD: A CIN is essentially a virtual supergroup, where practices of different sizesjoin together and form one large practice under a single taxpayer ID. But each practice gets to keep their independence, their business structure, their ownership structure, their workflows. The only thing that they’re required to share is clinical performance data.
What we're doing is starting to see each other as collaborators, instead of competitors. And that way we turn our catchment areas of practice from marketplaces into neighborhoods, and begin to collaborate to improve quality, because that's really the main piece of it. It's a clinical quality and quality measures,
George Rogu, MD: Dr. Espinoza forgot to mention that every group keeps its independent EHR.
ME: Let's talk specifically about the Independent Pediatric Consortium of Long Island. What led to its formation?
GR: The wave of consolidation that was sweeping the nation is what triggered this concern. Physicians went into private practice because they wanted to be independent, and when the practice is taken over by a system, that independence is totally lost. And that's what's leading to physician burnout because they're being told what to do from the top level down. And usually that top level is not a physician.
We decided to become, essentially, neighbors because of this outdated mentality.In the old days, private practices tended to see each other as competitors. We realize that there are plenty of children on Long Island for everybody to succeed. So we decided to pull this together. And we started to have conversations once a month, where people would share information on stuff like how to get PPE, getting certified on Meaningful Use and value based payments. And everybody gained from everybody else's experience. So we are essentially working together.
ME: What obstacles did you face in putting this together?
GR: Getting people to see that we need to help each other was the hardest part, because people are a little apprehensive to share their internal secrets or their work plans, because they used to think, why should I tell Dr. Espinoza how to do something, because I want to do it better than him. And I want him to not succeed. That's a competitive model.
The collaborative model we have is, if I have a good idea, or he has a good idea, or I have a connection somewhere, we share it. And we help change everybody's work plans, we help to become more efficient. One physician may know how to do something better than another. And we just share it. we try to make things better. But because of the Stark laws and concerns about collusion we had to become a legal entity, not just some doctors talking in the basement somewhere.
ME: Presumably, you didn't have the legal expertise to do this? You needed to find lawyers, consultants to help you put this together.
JE: Right. The first thing we found out was that we're going to need help. And just in that moment, we started seeing the benefit of being together. It allowed us to afford an attorney, and consultants that that could really steer us the right way. We wanted to do it legally and we wanted to do it permanently. And this attorney helped us put together the entity. It's essentially an LLC structure, because it allows different types of practices, different types of ownership.
We figured out what percentage of ownership large practices would have versus small practices and what percentage of representation. Once we decided that, we formed an executive board and executive committee, held elections, and here we are.
ME: Who makes the day-to-day operating decisions?
JE: We have an executive board, we have subcommittees within the board, and even people who are not officers of the board we use as resources. For example, I know that one of George's partners is very involved in care quality. And so, he heads a lot of the initiatives for that. We have zoom meetings, we vote and we move forward, it's pretty simple.
We always talk about it in terms of layers. And in systems there's a thick layer of suits at the top, and everything trickles down through them. And what we want to do is make that layer as thin as possible, so that whatever benefits come from our coming together go directly to the practices.
ME: How large are you now?
JE: I think we have 10 practices and about 50 physician providers. They range from a solo practice to a three-person practice to 15-plus providers. So it's a very interesting mix.
GR: What I’ve learned from this group is because we had so many different types. I have a larger group so I’ve never seen what a smaller physician deals with until I met some of these people. And we hold our meetings, we share our pains, and a lot of the pain is similar. And it becomes like a support club to helps us to resolve problems.
ME: What are some of the other services that the consortium provides to its members?
GR: Basically, because we have 50-plus physicians with multiple offices, we're able to enter into agreements with different types of vendors from employee health insurance to electronic health record resources, medical and office supplies, and malpractice discounts. And it puts us in a much better position to speak to other entities.
As a solo doc or practice you don’t have much leverage. But now when I speak to a vendor, I usually start the dialogue with you know, we're interested in your product. And oh, by the way, I have 50 other physicians within my group that we can extend this service to. Just the first year after forming the CIN, even before we had any third party contracts with anybody, we were able to recover our investments in legal fees and consultants and so forth, just from the savings that we had. That's pretty good.
ME: In what areas specifically?
GR: Malpractice insurance. We put everybody together as a group and presented the group to the malpractice carrier, and they underwrote us as an organization. They wrote it so that the physicians were shielded from other physicians within each practice, then the practices were shielded from the corporation and the corporations was shielded from the individual practices.So whatever happens malpractice wise, it stays at the individual physician level. If I get sued, it has nothing to do with Dr. Espinoza or the CIN. And we get significant discounts just by putting this together.
JE:. I think one of the biggest benefits was around the participation rules that a lot of the insurance companies have with value-based contracts. If you didn't have a certain number of patients in your panel, you didn't qualify for one of those contracts. So a lot of these smaller practices had maybe 200 patients, and you needed 1000 patients to participate. Now they had access to these contracts, because when we put our numbers together, we became a large enough group for them to have interest in providing us with a large contract.
I also think that one of the things that especially during the pandemic we saw be very useful is we became a neighborhood. During the pandemic there’s been a lot of talk about health care providers, and most of it was focused on people who work in hospitals, emergency rooms, urgent cares, and being exposed, but not much was being said about independent practices that were struggling to stay open. We're trying to figure out how to keep employees healthy, and how do I get access to the Paycheck Protection incentives?
GR: Those weekly Zoom calls were immensely useful for us. We were able to talk with each other to disseminate ideas and solutions quickly, and just to give each other support. One practice found a place that the county was distributing PPE to physician offices and shared that information. I mean, it's a silly little thing, a box of 10 masks, but you know, for a solo guy that's all he needed to stay open another week.
JE: I think probably the biggest benefit operationally is the access to data. Because as we move into this value-based world, data is the coin of the realm, and the ability to access your own data is difficult. We're not IT professionals, and a lot of the times, for the practices with more resources, were able to invest an entire one or two salaries into people to get this data out in a way that we can act on it meaningfully.
ME: Tell me more about that. You mentioned that everybody was able to keep their own EHR. But how do you aggregate data from different systems, and in a way that everybody can see it and you can present to payers?
GR: We knew that for the CIN, the legal thing that kept everybody together was this clinical dashboard. So initially, we went out to companies that do this.And I got quoted a quarter of a million dollars to build it. Then we started searching around, thinking there has to be a cheaper alternative. And we discovered that at the end of the day they (EHR data reports) are all Excel files in different formats.
So I dug around and found that there are companies out there that map this data and give you charts and graphs. I found a company that would take the Excel data from the three different EHRs that we use and could put it together and give us pretty pictures with numerators and denominators. And that's very important because I can tell which practice is doing better on a particular measure and see where the shortfalls are.
JE: I think that that's another one of the benefits, what we call wisdom resources. If we approach problems as a group, it's incredible how much easier it is to solve them when you have different perspectives looking at the problem, and having the data in front of you. So not everybody has to go through the same pain, and it makes things move a lot faster than in a large group. There are no committee meetings, no waiting for the next quarterly meeting. So it really is very efficient.
ME: It sounds like you're saying that the information sharing and best practices and moral support is at least as important as any extra money that you get from being part of this network?
JE: Absolutely. You can't have good medicine if you don't have happy doctors, because people want to do well. And not just financially, but to make sure you're doing a good job. But the top down approach (of a hospital system) gets in the way of that satisfaction. We believe that smaller moving parts together work better than one big moving part.
GR: I learned long ago that if you do good medicine, the money will follow. So we're trying to follow that and just do good quality medicine. eventually contracts and incentives and all this stuff, just follow suit without doing anything.
ME: Is there a size beyond which you no longer have these benefits, that you start becoming too bureaucratic?
JE: We have, and I think it's more geographic size than number of practices. If you have a common goal for a county then the size of your CIN is the size of the county. If your goals are the size of the state then it’s the size of the state. To be successful a CIN really requires like-minded people where maintaining your independence is the reason for joining. It’s very hard to predict the size limit of your neighborhood, and the best way of finding out is just by figuring out who's your neighbor and who's not your neighbor.
ME: Any other challenges you see ahead?
JE: The biggest challenge is we have to stop seeing each other as competitors, and replace it with a culture of being neighbors. When George and I decided to visit each other’s offices, to shadow each other, that’s something people just don’t do. They’re apprehensive about giving away their secrets. But the reality is there’s plenty of work for each of us. If we become neighbors it will be easier for us to make each other better and allow each other to survive.
Independent practices need to realize their value. Once we do that and we become a neighborhood we start sharing each other’s wisdom and best practices and we continue to do good medicine without giving up our independence.
ME: What advice do you have for other primary care doctors thinking of forming a CIN?
JE: Start talking with each other. Get together. Ask “what are you concerned about? How do we go from being competitors to being collaborators?” Create a forum where you can speak to each other and listen to each other. Then you’ll figure out what you want as a group, and pretty soon other practices will join as they see there are benefits to it.
It’s not as difficult as it seems at first as long as you get over that hurdle of seeing each other as adversaries. You’ll be better off by becoming neighbors with nearby practices than by competing with them.