Value Based Payment

Mountain View Case Study

November 12, 2014 1:46 pm

Issues addressed in this case study include: 

  • Physician governance within a health system
  • Integrating physician practice and other components of the management team
  • Experiments in identifying population segments and tailoring approaching and resources to these segments
  • Managing the cost/benefit ratio associated with a medical group within a system 

Assessing the situation

Mountain View Health System is often regarded as the second health system in its region—second in market share, second in pricing with health plans, and second in name recognition. The system has five hospitals, including three in urban areas and two in nearby rural areas.
Mountain View’s largest hospital is in its largest population center. The hospital has a predominantly employed medical group. Orthopedics is provided by a well-established group that works at three of the five hospitals. National firms have been contracted with to provide hospitalists and emergency physician services.
Mountain View’s other hospitals have limited but growing numbers of employed physicians. To date, Mountain View’s system has regarded physician relations as a market-by-market decision by the hospital CEOs; however, coordination on these issues between CEOs is strongly supported.
Mountain View leadership recognizes that a more committed, better-coordinated physician group is the top priority in having Mountain View go from second to first position in its market. Looking ahead, leadership recognizes the need to:   

  • Provide a consistent patient experience with a “high-touch feel” at all sites (hospitals, physician offices, and other)
  • Show payers and employers that the system can deliver a consistently high quality product at a competitive per member per month price
  • Move to a leadership position in population health management and grab part of the premium as soon as the appropriate tools are in place

This requires, above all, a medical group that moves in concert with the system.

Assessing options

Mountain View’s management recognizes that its physician goals represent major changes from “business as usual.” Mountain View needed a transparent, wide-reaching process to identify and “sell” the changes. A steering committee is formed to drive the system’s change leadership process.

Tool: Mountain View Health System’s Change Leadership Process  

Moving forward

After careful consideration of the steering committee’s recommendations, Mountain View’s system management and board, member hospitals and the existing employed physician groups agreed to a set of key initiatives. Affiliated physicians were also involved. 

Tool: Mountain View Health System’s Key Physician Initiatives

Mountain View Health System has reorganized. Its clinically integrated network and its employed physician group each has its own non-fiduciary board, with a majority of physician members. The heads of these organizations have dual reports to these non-fiduciary boards and to Mountain View’s CEO.

Tool: Mountain View Health System’s New Organization Structure

Mountain View has come to think of itself not as a hospital system but as a care network. Certainly, many decisions are still made by the hospital system, by hospital teams within the system, by the employed physician group, by the independent physician groups in the CIN, or by other entities in the CIN (such as rehabilitation and home health providers). However, the direction of movement is toward closely coordinated decisions.
Mountain View’s CIN is assisting all primary care practices in the CIN with moving to become patient-centered medical homes. Care coordinators are being added to several of the practices. Meanwhile, Mountain View’s largest hospital is in a position to move faster with respect to some aspects of population health. 

In other important changes, 

  • Physician dashboards. The CIN is intent on developing physician level dashboards that include quality, patient experience, RVU, and per-member-per-month cost data. The system began receiving direct feeds of claims data for all patients from two payers. These data are combined with national metrics and early feeds from its electronic medical records. The system CIO, CMO and CFO recently visited two other systems to see what others are doing. At this point, the dashboards are much better developed for the employed physician group than for the other physicians in the CIN.
  • Physician compensation. The compensation agreements for primary care physicians in the employed group have been modified to be 80% based on RVUs, 20% based on an agreed on set of quality and service indicators. 
  • Hospitalist services. The system has negotiated an agreement with a national hospitalist group. The group is incentivized to work closely with primary care physicians, care coordinators, and other providers in the CIN to avoid readmissions. 
  • Analytics and predictive modeling. The system has acquired sophisticated analytics to help identify the “sickest of the sick” patients. The system is establishing its first “extensivist clinic” on the campus of its largest hospital. The system hopes to go further by partnering with other systems in pooling population health information and approaches. This is expected to include a joint approach to predictive modeling.
  • Reducing leakage. The system and CIN are beginning to address leakage in the system (the numbers of patients who start by receiving services in the system but end up going outside even though the services needed are within the system). The first step was to measure the leakage and begin to identify why it was happening. Already, this effort is leading not only to better hospital bottom lines, but also to improved financial performance in specialists’ practices.

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