Business Intelligence

Dean C. Coddington
Keith D. Moore

How far should health systems go in reflecting physician perspectives in their business intelligence?

The answer, for most, is to go much further than they have thus far. Some healthcare organizations talk about being "physician-driven," but what does this actually mean, and how is it achieved?

Our research suggests that the journey to a physician-driven health system, or to informing decisions with good physician input and information, has four parts:

  • Capturing physician practice and other relevant data
  • Enhancing techniques for analyzing the full range of patient data
  • Establishing physicians in leadership roles
  • Moving to a culture of physician leadership

Capturing the Right Data

To manage care effectively, many organizations use a database that combines patient-specific clinical and financial information across care settings. As one CFO suggested, "'The Holy Grail' of databases is a patient-specific, longitudinal database that includes all payments from all sources for all services." For analyzing chronic diseases, the use of registries that indicate patients with specific diseases is a second,fundamental building block.

Most health systems are further along in developing decision-support capabilities that incorporate inpatient data, and at the "early stage" in expanding to integrate patient and costing data on their network physicians' offices. The decision-support systems are typically fed data from cost accounting systems, electronic health records, and other sources.

The cost accounting system of the future needs to include all care settings, including all physician offices that are in the health system's network. A recent survey of health system CFOs, conducted in conjunction with HFMA's Value Project, found that only 28 percent of respondents indicated they have a "moderate" or "significant" capability to produce accurate cost data for their network medical practices today; however, 75 percent expect to have these capabilities within three years.

Analyzing Patient and Practice Information

Systems are adding analytical software and trained staff. However, physicians have the key role in turning all these new data into actionable decision support. Here are a few examples of the uses of this physician-aided decision support:

  • Readmissions reduction initiatives
  • Chronic care management strategies
  • Physician network management
  • Physician and management incentive structures
  • Bundled payments contracting
  • Gain- or risk-sharing payments
  • Other value-based payment structures
  • Capital decisions
  • Budgeting and forecasting

Early pilots of value-based payment models make it clear that many users need to make use of this kind of information. The timeliness of the information/analyses is almost as important as its accuracy.

Establishing Physicians in a Leadership Role

Physicians are being asked to play a many-faceted role that they were not trained for in medical school. They assist in designing and interpreting the new decision-support data. They use the information to design specific strategies, scorecards, and initiatives. Then, physicians-along with nurses and other caregivers-translate the results to meet the needs of individual patients.

To establish strong physician leaders, health systems work to select from outstanding clinicians who also have strong people skills and leadership potential. Most of these physicians get involved in committees, task forces, and other ad hoc roles. They learn from others, find benchmarking opportunities, and pick up much of the new knowledge base as they go.

We haven't seen a health system make substantial progress in managing chronic care or reducing readmissions, or in any of the numerous earlier initiatives in population care management, without highly effective physician leadership. This type of leader needs to be effective at influencing other physicians and other members of the management team.

Some multihospital system CEOs have gone a step further. In describing these physician leaders, they have said, "The ultimate goal is to 'turn over the keys' to the physicians."

If this is the case, a lot of work is yet to be done: Health systems will need to make the identification and "care and feeding" of future physician leaders a high priority.

Moving to a Culture of Physician Leadership

Health systems will require interactions and inputs from numerous physicians if future cost and quality goals are to be achieved. To this end, they will require forums for generating ideas, developing best practices, and monitoring and adjusting approaches. In essence, health systems will require a culture of ongoing initiatives in physician leadership.

Certainly some integrated systems (Billings Clinic, Kaiser Permanente, and Scott & White, for example, as well as many others) have been cultivating a culture of physician leadership for some time. However, this is not the norm. More typical is the case of this multihospital system:

"We have a track record as a leading health system. We have a highly developed approach to system leadership-with clear goals and priorities, clear lines of accountability, and aligned incentives for the leadership team of the system. However, our physician leadership structure is in its infancy. And we have not started to integrate our system approach to leadership with our physician organization and network leadership. That all lies ahead."

The Certain Future

Different hospitals and health systems will certainly take different approaches. However, almost every path will lead the organization through a growth in business intelligence (with far more emphasis on coordinating non-inpatient activities) and an ongoing evolution in physician leadership.

Dean C. Coddington is a senior consultant, McManis Consulting, Denver, and a member of HFMA's Colorado Chapter (

Keith D. Moore is CEO, McManis Consulting, Denver ( 


Publication Date: Friday, June 01, 2012

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