ARCHIVED  April 1, 1997

Western Plains, Poudre Valley create systems of seamless care

A popular slogan bantered about at health-care conferences these days is, “If you’ve seen one integrated system, you’ve seen one integrated system.”

Integrated health-care delivery is purported by many to be the next wave in the industry. Seamless systems of physicians groups, hospitals, ancillary-care services and management organizations that contract as a unit with insurance companies or directly with employers or groups of employers to provide a continuum of quality care are in various stages of development all over the country.

In Northern Colorado, we have Western Plains Health Network, generally considered to be a fully integrated system, which extends services throughout the region, and the fledgling Poudre Valley Health System, which is in development and, at this point, is more of an idea than an existing network.

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Western Plains evolved under the auspices of Lutheran Health Systems, an enormous not-for-profit health-care service organization operating in 17 states. LHS leases North Colorado Medical Center and East Morgan County Hospital in Brush and owns McKee Medical Center in Loveland and Sterling Regional MedCenter. When they affiliated with NCMC in 1995 LHS gained a large tertiary-care hospital with a strong relationship and orientation to the rural markets.

“Before we negotiated an affiliation agreement with LHS, other parts of the system were informally connected, and we were an independent hospital,´ said Gene Haffner, director of community relations and communications for NCMC. “But once we were in, it made sense to form a formal network.”

Western Plains includes four hospitals, three physician networks, including two physician hospital organizations; clinics in Sterling, Brush, Keenesburg, Fort Lupton and Berthoud; and home care and home-medical-equipment facilities in Loveland, Greeley, Fort Morgan and Sterling. The Loveland facility serves the area from Longmont to Fort Collins and provides patients with all levels and most types of health-care services through a single structure of providers — the definition of an integrated system.

The PHOs in the system, High Plains Healthcare Alliance Inc. in Greeley and Mountain Shadows Medical Association Inc. in Loveland, share a 50-50 governance with the hospitals in their respective areas, said Jim Humphrey, director of operations for both PHOs.

“The physicians and hospitals in our PHOs have a shared methodology, and an incentive to work jointly on issues in the industry,” Humphrey said. “Previously, an insurance company had separate contracts with the physicians and hospitals. Now there’s one, and both sides must work together to manage costs while maintaining high-quality care, and we’re doing it successfully.”

Humphrey said the PHOs just got started in the last two years, but they appear to be growing. High Plains Healthcare Alliance now has 8,000 covered lives and almost 200 PCPs and specialists, and Mountain Shadows has 10,000 members and almost 100 PCPs and specialists, according to the 1996 Directory of Colorado Managed Care.

NorthCare, a for-profit managed-care network owned by NCMC and leased to LHS, represents another hefty link of Western Plains’ integrated system. With almost 60,000 covered lives, relationships with more than a dozen regional hospitals and almost 400 PCPs and specialists, the for-profit network is popular with PPO plans as well as with HMOs and point-of-service plans.

In addition, Wray Community District Hospital, Yuma District Hospital and Melissa Memorial Hospital in Holyoke have contracted with Western Plains to benefit from group purchasing contracts, educational offerings such as teleconferencing and other services. The network sends specialty physicians as far as Ogallala, Neb., to hold clinics on their area of expertise, and they’ve also partnered with the High Plains Rural Health Network, which allows for further penetration through teleconferencing.

The name of the game in integrated systems is using existing systems more efficiently, not running out and initiating new ones, Haffner said. “Our goal is to create total community care that keeps patients in familiar and comfortable centers where they receive quality care for a lifetime,” he said. “We want to eliminate duplication of tertiary medical services and try to predict services that might be useful to others outside the system.”

There are roadblocks to building and sustaining a fully integrated network that meets the needs of the community, however.

“Our first challenge is time, because health care is changing as quickly as we are,´ said Doug Vang, executive director of Western Plains. “The second is aligning the various stakeholders. It takes time to reconcile the views of the people involved and build relationships. It’s a long-term process that will be going on for years.”

In Fort Collins, the independent physicians associations, United Physicians of Northern Colorado and Fort Collins IPA, are saying “Show me the contract,” after PVH and Fort Collins IPA attempted to start a PHO more than two years ago, and negotiations stalled last year.

“There was definite support to develop a PHO with PVH, but it didn’t go anywhere because PVH didn’t want to take part in capitation or lose any revenue,´ said Geri Jones, CEO of Fort Collins IPA. “We spent hundreds of thousands of dollars to try and do what we thought was best for all concerned, and it didn’t come to fruition.”

Jones said that experience left a bad taste in some mouths, and relationships between the physicians and the hospital will need to be carefully tended, but both IPAs are ready to try again.

So is the hospital, and they’ve stated their intention in their Strategic Plan, approved in January: “We will renew our commitment to creating an environment of trust and cooperation between physicians and the hospital … we expect there will be additional and multiple options for partnerships between physicians and the hospital … we envision that the system will provide, directly or through agreements with others, a full range of high quality, cost-effective and coordinated health care services for communities in northern Colorado, southern Wyoming and western Nebraska.”

The challenge, said Carol Davis, vice president of strategic planning for PVH, is figuring out how a limited number of dollars from the insurance companies should be distributed among the partners to provide the highest-quality and most cost-effective care possible.

“The jury is still out on whether or not a fully integrated delivery system is a good idea, but some degree of integration is good for the community,” Davis said. “There are synergies already in place that could be developed over time to better serve the consumer, and that’s what we’re looking at.”

PVH’s commitment to create some form of integrated health-care delivery is evident in the appointment of Paul Schofield to the newly created position of vice president of managed-care services.

Schofield, who worked in Minnesota and California, two managed-care hot spots, will aid the development of contractual arrangements between the hospital and managed-care health plans and work to solidify relationships with local physicians.

“The purpose of integrated delivery systems is to align the incentives of physicians and hospitals within a community so they work more effectively together with insurance companies,” Schofield said. “This is ideally accomplished through contractual agreements, and the hospital is moving in that direction. Even though there’s been difficulty in the past in developing an integrated delivery system between physicians in the medical community and the hospital, I’m hopeful that there is an opportunity to work collaboratively for mutual benefit.”

A sense of urgency prompts the hospital to pick up its pace in the move to integration. Davis acknowledges concern that lack of solid relationships between the hospital and physicians makes the area vulnerable to infiltration by another operation.

“We hear rumors every week that Columbia is coming to town,” Davis said, referring to Columbia Healthcare Corp., a behemoth for-profit company out of Nashville that is rapidly acquiring hospitals and other health-care facilities around the country. “And, yes, someone else could come in, but just because we’re the sole acute-care hospital in this area doesn’t mean we’re complacent. We should be making our decisions like there is competition.”

A fully vertically and horizontally integrated health-care system offers a large regional or community population one-stop shopping across a continuum from primary care through tertiary inpatient care and aftercare. If Western Plains falls short of that ideal in some areas, Haffner says they are working to attain it.

Concurrently, Poudre Valley Health System is working on its own ideal, and five or 10 years down the road, Northern Colorado might sport two integrated systems that meet the demand for quality care at a reasonable cost in distinctly different ways.

A popular slogan bantered about at health-care conferences these days is, “If you’ve seen one integrated system, you’ve seen one integrated system.”

Integrated health-care delivery is purported by many to be the next wave in the industry. Seamless systems of physicians groups, hospitals, ancillary-care services and management organizations that contract as a unit with insurance companies or directly with employers or groups of employers to provide a continuum of quality care are in various stages of development all over the country.

In Northern Colorado, we have Western Plains Health Network, generally considered to be a fully integrated system, which extends services throughout…

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