hfm: Does your organization have a specific strategy that is guiding integration among hospitals, physicians, and other provider types?

Reed: Sutter Health has long believed that integration among physicians, hospitals, and other providers is the best and most efficient way to deliver care to patients. In fact, a study by the Dartmouth Medical School's Center for the Evaluative Clinical Sciences found that the coordination of care that occurs among Sutter's physicians, hospitals, and home care and hospice services in the Sacramento area represented a national benchmark.

Our system took a significant step toward greater integration this year with the implementation of a five-region governance and management structure. This replaces a structure where dozens of Sutter-affiliated physician organizations and hospitals maintained their own boards and management teams. Our new structure preserves a strong local and regional voice for our physician organizations and hospitals while also recognizing that we deliver the highest quality and greatest value to our patients when we collaborate and coordinate care for patients.

hfm: How does finance fit into the formation and implementation of your integration strategy?

Reed: In many ways, the problem in health care today is that the payment mechanisms have sliced and diced healthcare services into very narrow piecemeal work, which in turn created a silo mentality around the delivery of care. Finance plays a critical role in bringing together these various silos and piecemeal payments into a coherent, integrated financial model.

hfm: What are the biggest challenges to successful implementation of an integration strategy?

Reed: The biggest challenge is inertia. Resisting change is part of human nature, and maintaining the status quo can be appealing, especially if the future isn't particularly clear.

hfm: Have you found any mitigants that have been successful in overcoming these challenges?

Reed: Understanding and acknowledging the impact of change on the important stakeholders is a good place to start. At Sutter Health, we've also quantified how our integrated approach to medicine demonstrably improves quality and efficiency. Physicians and hospitals share a commitment to doing the right thing for patients, and in our experience there's a positive momentum and openness to change that builds when you're able to raise the quality bar.

Robert Reed is Senior Vice President and CFO, Sutter Health, Sacramento, Calif.

Publication Date: Tuesday, June 01, 2010

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