New management models can help practices remain independent

Across the country, independent physician groups are faced with a big decision. Can they continue down that independent road?

Practices wanting to remain independent face numerous obstacles, such as maintaining information technology and quality and safety compliance, which can be expensive.  

"Across the country, physician groups are contemplating whether they continue independently or partner with large hospital systems or corporate entities," says Jeffrey D. LeBenger, M.D., CEO and chairman of Summit Health Management and Summit Medical Group, in an interview with FierceHealthcare.

Indeed, the number of independent physician practices has been dropping. As of mid-2015, one in four medical practices was hospital-owned. And 2016 marked the first year in which physician practice ownership is no longer the majority arrangement, with physicians evenly distributed between owners and employees: 47.1% of doctors own their own practice, with the same percentage employed and 5.9% independent contractors.

A recent study shows there’s been no slowdown in the trend toward physician employment, as hospitals acquired 5,000 independent physician practices in a 12-month period, from July 2015 to July 2016. Over the same period, the number of physicians employed by hospitals grew by 14,000, representing nearly 11% growth.

But LeBenger says physicians aren’t limited to either maintaining a private practice on their own or hospital employment. There’s another alternative: contracting with a management company to remain independent, such as the physician-developed model offered by his New Jersey company that lowers the cost of care while providing a good patient experience and provider satisfaction.

“Our goal is to provide colleagues with all of the resources needed to sustain thriving independent physician groups,” he says about the company, which recently went national.

Expansion in Oregon, Arizona

Two recent transactions mark the company’s expansion of its practice management and population health model into Oregon and Arizona.

Summit began providing administrative, clinical and financial management services to Bend Memorial Clinic in Oregon, the largest independent multispecialty group in its region with 120 providers, as of Jan. 1. The clinic took on a new name: the Summit Medical Group Oregon—Bend Memorial Clinic.

And starting Jan. 1, Summit joined 51 providers in the greater Phoenix area, which were affiliated as Arizona Primary Care Physicians, to form Summit Medical Group Arizona. A signed managed services contract with the doctors’ group will facilitate the partnership and transition. The new medical group will offer more physician specialists and new services, such as radiology, same-day care and urgent care, that create “one-stop shops” for patient care.

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The agreements will allow Bend Memorial Clinic and Arizona Primary Care to retain their physician-owned and governed structures and patient-centric philosophy with support from Summit Health Management, he says. 

Those newly formed relationships show that the model that worked successfully at Summit Medical Group in New Jersey is scalable, customizable and can work nationally, according to LeBenger.

A beginning in New Jersey

One metric that LeBenger likes to talk about is the growth of Summit Medical Group from 125 to more than 800 providers in northern New Jersey in the past six years, all with less than a 1% turnover. It is the largest and oldest physician-owned, multispecialty medical practice in the New York/New Jersey metropolitan area and among the largest in the nation.

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In the last 15 years, it went from a small medical practice to a comprehensive, integrated delivery system with more than 70 locations and 1.2 million patient visits per year. That low physician turnover rate shows that most doctors are happy with the setup, he says.

How this model works

LeBenger’s model centers on quality patient care because, he says, achieving clinical success inevitably leads to financial success. And it helps practices lower costs with streamlined management services and operations, LeBenger says.

For example, its revenue cycle management services advise physician-led and -governed groups on contracts, billing, getting claims out the door and obtaining payment. The management company can track the patient visit from scheduling to bill payment. Its registration, authorization and preservice processes are centralized, enabling practices to scale large volumes of patients and reduce turnaround time, he says. Wherever possible, the company employs best practices and looks for economies of scale such as national purchasing power to benefit its groups.

In addition, the services are scalable and enable practices to strategically shift from a fee-for-service to a fee-for-value reimbursement model, he says. The structure and extent of the management company’s administrative and corporate management services are developed with each potential client/partner or group, based on their specific needs. Operations management begins with a thorough assessment of a medical group from a patient-centric point of view.

Once the assessment is completed, the company works with the group’s physicians to prioritize operational changes. This can include establishing optimal staff ratios, technology and supporting infrastructure, a standardized approach to workflows and real estate strategies, he says.

Population health and value-based care models

LeBenger says the approach also allows the company to share with practices resources and expertise in population health management and value-based care models.

The company’s population health department supports the delivery of care to more than 500,000 patients at Summit Medical Group in New Jersey, manages cost and quality of care for about 117,000 patients attributed in accountable care organization contracts and exceeds benchmarks in seven value-based contracts, he says.

“Physicians understand that value-based care is the way of the future, and that we can accelerate their journey towards evidence-based, cost-effective, comprehensive care,” he says.