Tuesday, February 14, 2012

If You've Seen One Integrated Model...

Reading a recent case-based study of leading U.S. integrated delivery systems lead me to a conclusion that you might expect – if you've seen one integrated delivery system, you've seen one. The study, which was published as an excerpt in last month's OPEN MINDS Newsletter, Disruptive Innovation In Integrated Care Delivery Systems: The Market Trends We Were Surprised Not To See premium members, uses disruptive innovation theory to examine integrated delivery systems and their performance. The study found what anyone on the ground in service delivery systems knows – in practice "mixed models" that are adapted to the geography, organization, and consumers work better than a rigorous "fidelity to the model" approach.

There were a few other pearls I picked up in reading this case study analysis. First there were the conclusions I expected to read:

1. Robust information technology is a prerequisite for integration (a no brainer).

2. Strong culture is necessary for integrated models to succeed – but is not enough without the other management factors (also a no brainer).

3. Health systems aren't big fans of retail clinics (the rationale was that health systems could serve the same function if they offered "quick service" in existing facilities or by dealing with consumers on line).

4. "You do not need to own hospitals to operate an IDS, and in some situations, you may be better off not owning one" (their words, not mine).

5. Disruptive innovation only seemed to happen willingly in situations with great resource scarcity (no organization really "volunteers" for innovation via disruption – proving that necessity is the mother of invention).

There were two findings that I found somewhat surprising:

1. Customers did not use public fee information or quality information as much as anticipated (I think this is a question of how information is presented and advertised – but the jury is out).

2. The integrated systems studied produced some reductions in health care costs, but not to a great magnitude, and health status of targeted subpopulations did not improve markedly (I think this speaks to financial incentives – and parallels the recent Congressional Budget Office (CBO) study on only competitively-bid bundled payments producing net savings, see Medicare Demonstration Project Results Are In – Only Winner Was Bundled Payments all members).

The concept of integration will certainly continue, but finding the models that work and the organizational characteristics that can make the models work is the question. We'll keep you posted.

Sincerely,
Monica E. Oss
Chief Executive Officer, OPEN MINDS

Back to top

For another free resource, see: Does Your Team Have The Critical Skills To Implement Disruptive Solutions? all members 

This is free for the next sixty days to all registered OPEN MINDS Circle members.

Back to top