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Physician Exec. 2012 Jul-Aug;38(4):38-45.

Managing the physics of the economics of integrated health care.

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1
School of Public Health, University of Minnesota, USA.

Abstract

The physics metaphor, as applied to the economics (and financial performance) of the integrated health system, seems appropriate when considered together with the nine principles of management framework provided. The nature of the integrated design enhances leaders' management potential as they consider organizational operations and strategy in the markets ahead. One question begged by this argument for the integrated design is the durability, efficiency and ultimate long-term survivability of the more "traditional" community health care delivery models, which, by design, are fragmented, internally competitive and less capital efficient. They also cannot exploit the leverage of teams, optimal access management or the pursuit of revenues made available in many forms. For those who wish to move from the traditional to the more integrated community health system designs (especially those who have not yet started the journey), the path requires: * Sufficient balance sheet capacity to fund the integration process-especially as the model requires physician practice acquisitions and electronic health record implementations * A well-prepared board13, 14 * A functional, durable and sustainable physician services enterprise design * A redesigned organizational and governance structure * Favorable internal financial incentives alignment design * Effective accountable physician leadership * Awareness that the system is not solely a funding strategy for acquired physicians, rather a fully -.. committed clinical and business model, one in which patient-centered integrated care is the core service (and not acute care hospital-based services) A willingness to create and exploit the implied and inherent potential of an integrated design and unified brand Last, it's important to remember that an integrated health system is a tool that creates a "new potential" (a physics metaphor reference, one last time). The design doesn't operate itself. Application of the management principles presented here are necessary as a complete recipe. Leaders of health systems moving toward integration are cautioned to apply the recipe in full. This article ends with two questions. First, if not an integrated model of health care, what's the alternative? Since it seems clear that many of the existing community-based models are excessively fragmented and inefficient, especially in a reforming U.S. health care marketplace, is there a new model that is superior to the integrated models and, if so, what is it and what are its functional principles? The second question: Is there more than one functional form of integration? This article argues for the most integrated form. Others would argue that clinical integration is sufficient,'s and full integration isn't required. The stability, durability and adaptability of the fully integrated models have, arguably, been tested. The lesser integrated models remain to be proven in an unstable health care marketplace seeking higher levels of economic efficiency.

PMID:
23888674
[Indexed for MEDLINE]
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