Jackie, the director of strategic planning at
Healthy Hospital, was working with her CEO
to determine what strategy their organization
should take for specialist providers to whom
they refer their capitated business. Currently,
15 percent of their business was paid on a
population health or capitated basis, but when
specialists were required, patients were
referred to outside doctors and paid out of the
capitated pool of money. This amount has
become significant, with most payments made
at full cost. Jackie's boss believes there must
be a way to lower costs and, at the same time,
improve quality
by creating a smaller
specialist panel.
She realizes that the continued move to
population health, in effect, restricts more of
HealthyHospital's
market's patients
bycontract
to specific providers and, as it accepts
more fully capitated arrangements, it needs to
expand its network from employed providers
to a group of specialists, which would
effectively lock down the referral patterns.
Rather than only
looking at
thefinancials,
Jackie has written the assumptions
it has used to
date. These include the
following:
slow to materialize, the number of
patients covered by such payments will
double in the next two years and
quadruple in the next four years.
capitated population contracts.
willing to contract to promote population
health.
potential providers for efficiency, quality,
and effectiveness.
a population health focus.
provide population health.
possible choices:
charges for referrals.
in overall cost and quality.
Move to bundled payments. This system
works best for high-volume, elective
procedures with some predictability in
costs. It could lead to a race to the bottom.
patients. More patients would be present to
moderate variability, but it would be
challenging because of the breadth of
contracting.highest
cost patients. A smaller number of
patients creates higher variation in patient
costs.group
of conditions across multiple
specialties. This arrangement would require
contracting with a large group of
multispecialty providers.
and possible choices to her CEO to determine
which options are realistic to pursue.
Questions1.
Are all of Jackie's assumptions credible?
Have any of these changed or are
changing?2.
How could Jackie strengthen her
presentation by incorporating her
organization's mission, vision, and
values?3.
What additional problems may arise with
each of the choices she presents?.
Jackie the director of strategic planning at Healthy Hospit.pdf
1. Jackie, the director of strategic planning at
Healthy Hospital, was working with her CEO
to determine what strategy their organization
should take for specialist providers to whom
they refer their capitated business. Currently,
15 percent of their business was paid on a
population health or capitated basis, but when
specialists were required, patients were
referred to outside doctors and paid out of the
capitated pool of money. This amount has
become significant, with most payments made
at full cost. Jackie's boss believes there must
be a way to lower costs and, at the same time,
improve quality
by creating a smaller
specialist panel.
She realizes that the continued move to
population health, in effect, restricts more of
Healthy
Hospital's market's patients
by
contract to specific providers and, as it accepts
more fully capitated arrangements, it needs to
expand its network from employed providers
to a group of specialists, which would
effectively lock down the referral patterns.
Rather than only
looking at
the
financials, Jackie has written the assumptions
it has used to
date. These include the
following:
slow to materialize, the number of
patients covered by such payments will
double in the next two years and
quadruple in the next four years.
capitated population contracts.
willing to contract to promote population
health.
2. potential providers for efficiency, quality,
and effectiveness.
a population health focus.
provide population health.
possible choices:
charges for referrals.
in overall cost and quality.
Move to bundled payments. This system
works best for high-volume, elective
procedures with some predictability in
costs. It could lead to a race to the bottom.
patients. More patients would be present to
moderate variability, but it would be
challenging because of the breadth of
contracting.
highest cost patients. A smaller number of
patients creates higher variation in patient
costs.
group of conditions across multiple
specialties. This arrangement would require
contracting with a large group of
multispecialty providers.
and possible choices to her CEO to determine
which options are realistic to pursue.
Questions
1. Are all of Jackie's assumptions credible?
Have any of these changed or are
changing?
2. How could Jackie strengthen her
presentation by incorporating her
organization's mission, vision, and
values?
3. What additional problems may arise with
each of the choices she presents?
