Kris Shepard, JD, PhD - The Value of of Physician Networks in Healthcare

Move to Value

In this episode, we hear the second half of the conversation between Kris Shepard, Senior Vice President at Advocate Health, and CHESS President Dr. Yates Lennon, as they discuss how physician networks and primary care services are the backbone of the value movement in healthcare.

So Chris, welcome back to the Chess Move to Value podcast. Look, look forward to continuing our earlier conversation.

Awesome. Well, had a good time so far and I'm expecting nothing less for the second, second-half.

OK, great. Well, let's start out the second-half here. Just let's talk a little bit about some of some business development goals, both from the lens of the MSOVSO and from Advocate perhaps as well as if I'm an independent physician in the market, whether that's the Carolinas, Georgia, Wisconsin, Illinois, what should I be thinking about? So come at it from both sides.

It's a great, great question. The, the starting point for me is really an acknowledgement that the healthcare industry is changing. And you know, we've, we've talked about change and transformation in healthcare for a long time. So this is I think part of that broad continuum in the future, I expect that there will be increasing, it would be increasingly important for the ambulatory enterprise to take on more of the care delivery then perhaps we have historically it's more and more expensive to build hospitals. I think you, you know, you see a lot of commentators talking about hospitals becoming more focused on kind of higher acuity, higher complexity things. And so you know, they're always going to be here. And we're, you know, we are building broadly in facilities across the advocate enterprise and investing in, in improvements in the facilities. And at the same time, it's going to be increasingly important for the ambulatory enterprise to take to take on more and more. Some of that is is is has a regulatory dimension to it. So for example, CON laws being loosened or removed in in South Carolina, North Carolina, perhaps other places. I think those those kinds of regulatory changes, reimbursement changes that that encourage certain certain types of procedures and certain care to move out of facilities into the ambulatory setting. All those I think point us toward a future where to for a health system we are going to need to be successful in that ambulatory space as well as as as with our facilities. So what does that mean from a physician you know, or a clinical enterprise development lens, a physician partnership lens? I think those relationships become even more important and and in some ways more challenging because there there are a lot of organizations, whether they're payer backed organizations or private equity backed organizations or public companies like an Amazon who are moving into that ambulatory space. There's almost nobody going into the facility areas, you know, not a lot of new money or new entrants, if you will, into in building hospitals, but they're definitely a lot of new entrants rolling up ambulatory practices. So, you know, from a strategic lens advocate can either, you know, choose to focus on, on the facilities or, you know, alternatively, what we've done is, is really geared toward building a significant ambulatory presence. And you know, we, we already have thousands of physicians employed, you know, hundreds and hundreds of clinic sites. We, we have a significant ambulatory presence already. But it's going to it's going to be increasingly important going forward to do that. And I think, you know, some of the some of the discussion we've already had about what's the right relationship within it with a given group and a given specialty is those, those questions become more significant when you think about how the industry is, is trending.

Yeah, Yeah. Let's let's head toward, I mean MSOs/VSOs are networks in and of themselves. But let's talk a little bit about physician networks. I think it can carry a lot of different meanings. So from your perspective, how would you describe a physician network and what's its primary purpose today?

I think the, the when I think of a physician network, it's really a, a group of physicians who are linked in some way through their patients with a broader care delivery system. And you know, certainly integrated delivery systems like Advocate that have the range of, you know, facilities and outpatient practices are and other components of care delivery are the prototypical physician network. But also when you add in independent groups, often tied together through a value platform such as a a clinically integrated network or accountable care organization or both those are also physician networks in my book. You know, it's interesting because the, in the past, I think there's been, you know, this strategy of, of that's been more focused on facility financial performance and you know, where patients end up. And we're always going to care that about where patients end up. I mean, I, you know, it's an important thing to think about. You, you want patients and physicians to choose your facilities, your services, your specialists, all those things. I think we've grown more cognizant that a physician network needs to deliver for the community. And certainly as the, as the industry continues to shift toward ambulatory presence and more care being delivered outside hospitals, that becomes a key strategic factor that you, that you have the, the, the network to be able to deliver for patients in a given community. And that you, you, you have to rely on the full scope of kind of health system realities and reimbursement to, to make that work.

Yeah. And that's an excellent point. And I, I think too of physician networks provide, I think a better opportunity to connect to the community-based organizations that are a growing part of the healthcare ecosystem now with the, the, not only the focus on, but the realization in the last decade or so of the, the large role that social determinants play in a person's health becoming a, a bigger and bigger part of how we're trying to think about providing healthcare. Being able to connect a large physician network to these community-based organizations to provide additional resources, whether it's grab bars in the shower or housing and food and, and those other types of resources. I think it's an excellent opportunity to serve the community as you were saying, right? Not just by bricks and mortar physicians’ offices, but how do you connect that network to those surrounding organizations that are helping to fill in the white spaces and be supportive of the patients in between provider visits I think it's going to be a, a key role for physician networks.

Particularly when you, when you think about an increasing emphasis on Wellness and on and keeping people well, that becomes increasingly important to have that, that, that perspective and then the infrastructure outside our hospitals to deliver, to deliver what people need.

Right. It's a way of breaking down those silos, right? We've, I mean, as a physician myself, in my years of practice, I, I was not well connected sometimes to what was going on in the community, what resources were available in the community. But it interestingly, just last night, I was speaking to my mom about her sister, who is 90 plus years old, still lives in her home by herself, but has someone from the Senior Center there in their county that comes to their house and to her house and helps her clean and do dishes and, you know, different household chores. But it's helping her remain independent and stay in her own home, which is a quality-of-life issue for her. But it's also, you know, a cost savings for the system that she's not having to, you know, be institutionalized somewhere when just because she's getting older and having difficulty doing somethings at home. So I think that's a fascinating aspect and one as we think about building physician networks and MSOs and that's very local too. So what are you doing in your local market to make sure your physicians, whether MSO/VSO or both, you're connecting their patients to these resources. I think that can be a value add for physicians. It's my profound belief that physicians want to help their patients in these ways. They just don't know how and they're busy schedules. And I think there's there are times when we just avoid questions that we know we don't have the answers to. And so I think it's a huge opportunity both for physicians, but more importantly their patients.

Yeah, we, and, you know, to add to that, we, we need governmental and private payers to think hard about their approach to those kinds of things because I think we've, we've not done enough in that, in that space, both, you know, social determinants and, and a more broadly preventative care. And, and, and I realize it's really complicated to get that, that right. And you know, you, you start from, you know, the financial realities that that exists today. And it's hard to hard sometimes to move even to even into things that are that should be obvious benefits to patients and communities.

Yeah. And you and I have talked before offline of course, but about FQHCs and their role in the healthcare ecosystem and that that is a network of physicians that already know how to live on a budget. I mean, they have fixed resources and that they have a cost structure that they have to live within. And then for the CBOs, I think they're back to your point about payers and the government, excuse me, being needing to rethink how they pull those organizations into the reimbursement infrastructure. It's recognizing the work they do and seeing that as a part of delivering health, not not healthcare the way we think about it, but contributing to and delivering health, connecting that them and they've had to live on, you know, donations and grants and that's a not always a steady source of revenue. Always wondering when the grants going to run out, when what, what fundraisers do we need to have to support this? So I think that's going to be important.

Yep.

One last question I always like to ask in these podcasts, What if I not ask you that I should have asked you?

That's a that's a great question. I think the, you know, the one thing I know, I know in the move to value podcast, you often by definition focus on value-based care and, and maybe just to talk about that a little bit. And, and you know, we've talked about a fair amount about specialists and about program building, but just to, to focus a little bit on, on primary care and the importance of value. Certainly, from a strategic standpoint, whether it is in a building an employed primary care Group, A partnership like Atrium Health has done with One Health in the, in the, in North Carolina and maybe other places soon to delivering, you know, value services to independent practices. The importance of primary care in particular, I think is only going to grow. And, you know, there's a lot of a lot of different options, some growing kind of virtual capabilities, whether that's, you know, kind of the Amazon clinic type things or other, other models. But there's also a lot of continued growth in, you know, more typical brick and mortar primary care clinics. And that's going to, I think always be important to for, for health systems to build and, and I think for value-based care to be a part of going forward. And, you know, I'm, you know, we've talked about this a little bit. Some of the, the challenges with Medicare Advantage and abuses really coming out of private equity plays in there, you know, caused this momentary reflection, I suppose, on, on, on, you know, what, what it's doing. And the government is always, you know, tinkering with the Medicare programs that are out there and, and you have to kind of pay attention to what incentives the government's trying to create. I think when you step back in, at least from my perspective, we used to take a step back and look at the broad arc of what we're doing and, and what the government's doing in this space. It's, it's an arc toward, toward value, an arc toward increasing the increasing importance of, of really alternative payment models for the care that we deliver. And I think primary care is going to continue to be at the center of that and, and having a team to, to support practices in delivering value-based cares is, is only going to become more and more important. Certainly, as we, you know, this kind of loops back to the beginning of the conversation in a way, the notion that we offer a, a, a platform that includes the infrastructure kind of the basics. How do you how do you keep the lights on and keep patients coming in the door paired with a value-based care enablement platform that that remains a compelling alternative in my mind for physicians and I'm excited to see that continue to continue to mature.

Yeah, yeah, me too. Well, Kris, thanks. It's been a great conversation today. Thank you so much for joining the Chess Move to Value podcast.

It's been an honor. Thank you.