This article appears in the March 2012 issue of HealthLeaders magazine.
In 2007, the Federal Trade Commission reached a settlement with Advocate Health Partners, the nonprofit giant's physician hospital organization. The FTC had charged the group with price fixing and unfair competition in 2003. A subsequent four-year investigation led to concessions by both sides that resulted in the signing of a consent decree that essentially said that while the FTC did not approve the specific program, it would not challenge its clinical integration model. The Advocate PHO is, in fact, the model that the FTC now uses to illustrate a well-run clinical integration program, says Marty Manning, president of Advocate Physician Partners, a care management and managed care contracting organization that is a joint venture between the 12-hospital Advocate Health Care system and over 3,900 member physicians.
Manning stresses that although the name remains the same, the purpose of the PHO has changed dramatically since it was first constructed.
"What you're seeing now is a more comprehensive view of managing the continuum. It may have the same title, but the purpose is totally changed," he says. "It's become more of a sounding board for ideas, strategies, policies, and general guidance on contracts and, more important, about practical realities of changing the care delivery model."
Manning argues that while the PHO model may not work for every organization, it works for Advocate because it is a structured way to involve not only employed physicians, but also independent physicians in the community in strategic decision-making about coordination of care with the system. As value-based purchasing begins to take hold, Manning says the PHO will provide data and supporting infrastructure to enable physicians to best direct patients through the continuum of care.