From "sign here" to "open for business": Linking strategy to operational milestones for opening a hospital outpatient clinic

Hospitals and health systems employing physicians is a well-documented strategy designed to align the incentives between both parties such that each can thrive in a dynamic, highly competitive marketplace. Unlike in the 1990s when the motivation for employment was generating more volume in a managed care marketplace, the current trend of physician employment is sparked by the shift toward payment for value and population health management.¹ 

In 2018, physician owners of a practice (45.9%) were eclipsed by employed doctors (47.4%), per the American Medical Association’s benchmark survey.² Hospitals and health systems will continue to look for ways to align with physicians in a value-based market. Even if a health system has enough physician practices, it can still better organize the ones involved.³ 

Regardless of whether a hospital or health system is actively engaged in physician employment, leadership must determine the strategic objective it wants to achieve and evaluate how a partnership with physicians helps them achieve it.⁴ Hospital administration may believe that success in a value-based, population health-oriented environment depends on creating new or enhancing existing physician alignment initiatives. This is a direct response to many of the questions facing hospitals and health systems, including:
• How does the hospital differentiate itself from its competitors in its market?
• How does the hospital improve physician engagement?
• How does the hospital create or improve referral patterns?
• How does the hospital enhance revenue in an environment moving to a value-based reimbursement system?