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We Must Change the Care Model

By Dr. David C. Pate, News and Community
December 13, 2011

Today, I had the privilege of speaking on a panel of hospital representatives for the Idaho Medicaid Forum, held by the Idaho Department of Health & Welfare. Here is my presentation

In later blog entries, I'll elaborate on many of the points that I covered, but I wanted to give you a summary of points that I made and my answers to questions asked by Health & Welfare Deputy Director Leslie Clement. 

One of those questions was “What is the role of the hospital in managed care?”  I answered that the focus needs to be on the delivery system, of which hospitals are only a part. 

Further, while under a fee-for-service model, hospitals are a profit center; in a capitated model, or under most pay-for-value models, hospitals continue to play important roles, but become cost centers.

For St. Luke’s, we believe that the best solution to provide comprehensive medical care is to utilize a clinically integrated network, in which providers come together and identify best practices, incorporate them into their electronic medical records and practices, and then hold other providers in the network accountable for using these best practices; and aligned incentives.  The network needs to be physician-led. This is the strategy that we are pursuing here at St. Luke’s.

I was also asked, “How can managed care improve coordination, outcomes and access?” 

I explained that for St. Luke’s, the focus should be on the Triple Aim: better health, better care, and lower cost. 

These are the overriding principles of accountable care. Traditional managed care (preferred provider organizations, point of service plans, and health maintenance organizations) does not adequately address the Triple Aim, and specifically to the question, care coordination is not incentivized, volume of services is rewarded over outcomes, and access may actually be aggravated. 

In 2014, the rolls of the Medicaid program will increase by 50 percent in the state of Idaho. We don’t have enough physicians today in the state to meet all the needs of the current Medicaid population. There is no way we can recruit enough physicians for 2014 and beyond. 

What is the answer? We must change the care model to one that is team-based and incorporates non-physician providers, and we must change the payment methodology to encourage the use of these teams.

In later blog entries, I will discuss accountable care in much more detail. I think that it offers the best chance to address chronic disease management – poorly done now in the U.S. – and the best chance to improve the health of the population we serve, which traditional managed care has not addressed or incentivized.

About The Author

David C. Pate, M.D., J.D., is president and CEO of St. Luke's Health System, based in Boise, Idaho. Dr. Pate joined the System in 2009. He received his medical degree from Baylor College of Medicine in Houston and his law degree from the University of Houston Law Center.