Clinical Integration is an effort among physicians, often in collaboration with a hospital or health system, to develop active and ongoing clinical initiatives that are designed to control costs and improve the quality of health care services. A properly developed and implemented clinical integration program can involve independent physicians working with a hospital or health system contracting collectively with PPOs and other fee-for-service health plans without violating antitrust laws.

An effective clinical integration program will contain initiatives that

  • provide measurable results which
  • are used to evaluate physician performance and
  • result in concrete remediation of that performance.

Such a program should foster interdependence among providers and enable them to achieve higher quality and greater cost-effectiveness than they likely could accomplish on their own.

In many instances, clinical integration has involved independent doctors on the medical staff of the same hospital or hospital system who join together in an organization that allows them to:

  • Identify and adopt clinical protocols for the treatment of particular disease states.
  • Develop systems to monitor compliance with the adopted protocols on both an inpatient and outpatient basis.
  • Collaborate with the hospital or hospital system to encourage compliance with inpatient performance improvement processes and protocols.
  • Enter into contractual arrangements with fee-for-service health plans in a way that financially recognizes the physicians' efforts to improve health care quality and efficiency.
No. While Clinical Integration utilizes many of the same quality improvement and medical management techniques that would allow for effective management of capitation, it does not require the use of withholds or capitation.
Yes. In successful clinically-integrated models nationwide, collectively-negotiated contracts with PPOs, POS, and other fee-for-service health plans can include an enhanced fee schedule that recognizes the value of the higher quality and greater efficiency furnished through the clinical integration program. In addition, such arrangements have also involved financial rewards and incentives for physicians who perform well against the standards established by their peers.
No. Clinical Integration will only get us a seat at the table. In other words, clinical integration will allow us to approach health plans as a collective in a legal and appropriate manner. Our success as a physician organization in obtaining better PPO contracts will depend on our clinical quality and cost-effectiveness, our commitment to improvement, and our ability to hold each other accountable for results and the value the community, local employers, and health plans place in the care we provide.
Yes. Identified physician leaders along with health system leadership will work to create a new independent physician network. This physician network will be governed by a board composed predominantly of doctors, and will operate for the explicit purpose of developing and implementing a Clinical Integration Program, on the basis of which the network would negotiate pay-for-performance arrangements and related provider contracts with PPOs and other fee-for-service health plans.

Partnering with a hospital or health system can provide distinct advantages to a network of independent physicians in the development of clinical integration. In instances where the hospital shares the same quality vision as the physicians, the hospital can be a powerful ally in program development.

  • Collaborating with the physicians in the development of clinical integration initiatives based on existing inpatient quality measures.
  • Lending financial assistance and personnel in the implementation of inpatient and outpatient initiatives that provide true community benefit and are not tied to the volume or value of referrals.
  • Demonstrating to payors and the community as a whole that the clinical integration program is both legitimate and valuable.

While the physician leadership have not yet finalized the development of the physician network or the elements of the Clinical Integration Program, it is likely that physicians will be asked to do the following:

  • Choose whether they will participate in the Clinical Integration Program by signing a Network Participation Agreement. Membership in the Clinical Integration Program will be completely voluntary.
  • Physicians will be required to collaborate with their physician colleagues and the health system in the development and adoption of the Clinical Integration Program a collection of clinical initiatives that will enhance the quality, service, and cost-effectiveness of patient care.
  • Physicians will need to hold themselves and each other accountable for compliance with the initiatives of the Clinical Integration Program, including its disciplinary and remediation efforts should physicians not meet the benchmarks set by the Clinical Integration Program.

Although the Clinical Integration Program is still in the process of development, it is likely that it will include efforts designed to facilitate and improve:

  • Inpatient EMR and CPOE adoption
  • Ambulatory EMR adoption
  • Chronic disease management
  • Care episode management
  • PQRI reporting
  • Communication among primary care physicians and specialists
  • Community case management
  • Quality-based credentialing

The goal is that the Clinical Integration Program will enhance the value of the services we provide the patient and payor communities, measuring compliance with the initiatives using data from various sources, including: claims processing and adjudication systems, practice management and scheduling systems, disease registries, pharmacy benefit systems, and hospital and ambulatory EMR systems.

Yes. Participation in the quality and care management initiatives of the Clinical Integration Program will require significant time and attention from physicians and their office staff. But, in return, participating physicians will be eligible to obtain financial rewards for their achievements through the Clinical Integration Program, funded by contracted health plans. The amount of incentive payments will depend on both the physician’s personal score and the overall score of the organization. This latter component highlights the importance of physicians working together to improve care.

No. Since 1996, the FTC has been very consistent in its definition of clinical integration as well as the analytical framework it applies when evaluating clinical integration among a network of independent physicians. As defined by the FTC, a qualified clinically integrated arrangement is:

An arrangement to provide physician services in which: 1. all physicians who participate in the arrangement participate in active and ongoing programs of the arrangement to evaluate and modify the practice patterns of, and create a high degree of interdependence and cooperation among, these physicians, in order to control costs and ensure the quality of services provided through the arrangement; and 2. any agreement concerning price or other terms or conditions of dealing entered into by or within the arrangement is reasonably necessary to obtain significant efficiencies through the joint arrangement (As consistently outlined in FTC opinions and consent decrees,

The FTC has also indicated on numerous occasions that Clinical Integration programs may include:

(1) establishing mechanisms to monitor and control utilization of health care services that are designed to control costs and assure quality of care; (2) selectively choosing network physicians who are likely to further these efficiency objectives; and (3) the significant investment of capital, both monetary and human, in the necessary infrastructure and capability to realize the claimed efficiencies.

(Statements of Antitrust Enforcement Policy in Health Care by the FTC and the U.S. Department of Justice, Statement 8.)

Physicians have numerous and overlapping motivations for joining together in clinically-integrated networks.

  • Enhance the quality of the care provided to patients.
  • Legitimately negotiate with payors as a network.
  • Develop their own alternatives to health plan report cards and other initiatives that may not accurately assess physicians.
  • Provide access to technological and quality improvement infrastructure.
  • Allow networks of physicians and hospitals to market themselves on the basis of quality.
The FTC views clinically integrated physician networks as an opportunity to create efficiency and quality in care which can provide greater value to patients and employers (who pay for health insurance). However, the FTC will continue to prosecute those networks that fail to implement true clinical integration or seek to use the approach as a way of simply obtaining greater reimbursement without added value.
An ambulatory EMR is not a prerequisite for the development of clinical integration. While a common EMR across all participating physician practices can certainly accelerate and strengthen a clinical integration program, most (if not all) successful models of clinical integration nationwide do not depend on an ambulatory EMR for data on physician performance. Ultimately, a network of independent physicians may wish to implement an EMR that is designed in a manner that assists in the capture and extraction of the data necessary to continue to operate their clinical integration program. One opportunity offered by the anticipated Clinical Integration Program is the ability of the health system to underwrite a physician office EMR. But still, the Clinical Integration Program will likely begin its efforts to measure, analyze, and evaluate physician performance through claims data, existing hospital data, disease registries & chart audits.

Doctors and hospitals nationwide are implementing clinical integration programs not merely for reasons of antitrust compliance, but rather because they believe in its value proposition:

  • Clinical Integration allows physicians to:
    • Demonstrate their quality to current and future patients
    • Choose the clinical measures against which they will be evaluated
    • Enhance revenue through better management of chronic patients
    • Gather collective support for building necessary infrastructure
    • Seek higher reimbursement that reflects the higher value they can furnish patients and health plans.
  • Clinical Integration gives hospitals the ability to:
    • Demonstrate their quality to current and future patients
    • Enlist physician support for hospital initiatives, including compliance with core measures, clinical pathways, standardized order sets, and supply chain management initiatives
    • Develop a better, more collaborative relationship with their medical staff
    • Improve performance on hospital pay-for-performance measures
    • Position themselves at an advantage in the market on the basis of quality.
  • Clinical Integration provides patients with:
    • A better value for their health care dollar
    • More effective care management and outreach from a trusted source, their physician
    • More reliable information to support their choice of health plans, physicians, and hospitals
    • more accurate and meaningful provider ratings
    • Greater stability in their relationship with their doctor and hospital, and less likelihood that they will need to choose new health care providers every year.
  • Clinical Integration gives employers:
    • The ability to more effectively manage the health care costs of employees and their dependents through the purchase of better, more efficient health care services
    • Increased employee productivity and reduced absenteeism, through the better management of chronic disease
    • Lower health care costs over the long term, through the reduction of variation in physician practice patterns
    • More reliable information to support conversion to consumer-driven health insurance products.
Physician leaders will hold meetings at your hospital with detailed information regarding participation. In the coming months, the physician leaders developing the Clinical Integration Program will hold meetings at your hospital site for you to obtain detailed information regarding your participation in the Clinical Integration Program, the clinical quality initiatives of the Clinical Integration Program, and their pay-for-performance and incentive opportunities.