metrodoctors: accountable care networks fact or fantasy?

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MetroDoctors The Journal of the Twin Cities Medical Society July/August 2012 1

V O L U M E 1 4 , N O . 4 J U L Y / A U G U S T 2 0 1 2

Contents

Page 26

Page 12

2 Index to Advertisers

3 In thIs Issue The Future of Physician Payment By Lee H. Beecher, M.D.

4 PresIdent’s Message In Pursuit of Gigantic—but Hopefully not Titanic By Peter J. Dehnel, M.D.

5 tCMs In aCtIon By Sue Schettle, CEO

MedICal Care organIzatIons 6 • TC Network: A Fictitious Organization...an Interesting Exercise By Roger Kathol, M.D., and Ronnell Hansen, M.D.

8 • Counterpoint to the TC Network Report on ACOs By Richard J. Morris, M.D.

10 • Health Maintenance Organizations — Improving Cost, Care or Neither? By Aaron Nathenson, M.D.

12 • Colleague Interview: A Conversation With David Moen, M.D.

15 • Hennepin Health: An Integrated Health Care Delivery Network By Jennifer DeCubellis, LPC

17 • Collaborative Care Cooperative By Douglas Hanson, MPA

19 • Where do Specialists Fit in Accountable Care? By Thomas P. Flynn, M.D.

21 • The ACO Paradox By Scott R. Ketover, M.D., AGAF

24 Quiet Session: A Welcome Change By Nathan Mussell, J.D.

26 The Legacy of Dr. Eduard Boeckmann, East Metro Medical Pioneer

28 Mental Health and Primary Care Task Force Meets/

Senior Physicians Association News

29 Spotlight on Honoring Choices Physician “Stars”/

Honoring Choices Minnesota Conference

30 In Memoriam/Career Opportunities

32 luMInary of twIn CItIes MedICIne Mitchell J. Einzig, M.D.

On the cover: Like a Unicorn — everyone knows what an ACO is but never seen one. Articles begin on page 6.

2

Page 5

2 July/August 2012 MetroDoctors The Journal of the Twin Cities Medical Society

Physician Co-editor Lee H. Beecher, M.D.Physician Co-editor Peter J. Dehnel, M.D.Physician Co-editor Gregory A. Plotnikoff, M.D., MTSPhysician Co-editor Marvin S. Segal, M.D.Physician Co-editor Richard R. Sturgeon, M.D.Physician Co-editor Charles G. Terzian, M.D.Managing Editor Nancy K. BauerAssistant Editor Katie R. Snow

TCMS CEO Sue A. SchettleProduction Manager Sheila A. HatcherAdvertising Representative Betsy PierreCover Design by Outside Line Studio

MetroDoctors (ISSN 1526-4262) is published bi-monthly by the Twin Cities Medical Society, 1300 Godward Street NE, Broadway Place West, Suite 2000, Minneapolis, MN 55413. Periodical postage paid at St. Paul, Minnesota. Postmaster: Send address changes to MetroDoctors, Twin Cities Medical Society, 1300 Godward Street NE, Broadway Place West, Suite 2000, Minneapolis, MN 55413.

To promote its objectives and services, the Twin Cities Medical Society prints information in MetroDoctors regarding activities and interests of the society. Responsibility is not assumed for opinions expressed or implied in signed articles, and because of the freedom given to contributors, opinions may not necessarily reflect the official position of TCMS.

Send letters and other materials for consideration to MetroDoctors, Twin Cities Medical Society, 1300 Godward Street NE, Broadway Place West, Suite 2000, Minneapolis, MN 55413. E-mail: [email protected].

For advertising rates and space reservations, contact: Betsy Pierre 2318 Eastwood CircleMonticello, MN 55362 phone: (763) 295-5420fax: (763) 295-2550 e-mail: [email protected]

MetroDoctors reserves the right to reject any article or advertising copy not in accordance with editorial policy. Advertisements published in MetroDoctors do not imply endorsement or sponsorship by TCMS.

Non-members may subscribe to MetroDoctors at a cost of $15 per year or $3 per issue, if extra copies are available. For subscription information, contact Katie Snow at (612) 362-3704.

July/AugustIndex to Advertisers

TCMS Officers

President: Peter J. Dehnel, M.D.

President-elect: Edwin N. Bogonko, M.D.

Secretary: Lisa R. Mattson, M.D.

Treasurer: Kenneth N. Kephart, M.D.

Past President: Thomas D. Siefferman, M.D.

TCMS Executive Staff

Sue A. Schettle, Chief Executive Officer(612) 362-3799

[email protected] J. Anderson, Project Director

(612) [email protected]

Nancy K. Bauer, Associate Director, and Managing Editor, MetroDoctors(612) [email protected]

Andrea Farina, Executive Assistant(612) [email protected]

Barbara Greene, MPH, Community Engagement Director, Honoring Choices Minnesota(612) [email protected]

Katie R. Snow, Project Coordinator(612) [email protected]

For a complete list of TCMS Board of Directors go to www.metrodoctors.com.

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I N T H I S I S S U E . . .

The Future of Physician Payment

By Lee H. Beecher, M.D.Member, MetroDoctors Editorial Board

DOCTORS ARE REALISTS. The PPACA, now the law of the land and President Obama’s signature health care legislation, is now in the hands of the U.S. Supreme Court which is due to rule on key aspects of its constitutionality this summer. The 2012 elections and political discourse prominently feature health care policy issues which directly affect our professional and economic futures as doctors.

Accordingly, the Twin Cities Medical Society wants its members to discuss and debate how we, as physicians, can best serve our pa-tients while also having a viable economic future. In this spirit, this edition of MetroDoctors features the Twin Cities Network, a report from the TCMS Policy Committee. The TC Network is a “fictitious” physician controlled organization which could accept capitation risk contracts with payers (executive summary, Roger Kathol, M.D., and Ron Hansen, M.D., co-chairs (page 6). It is important to note that the TC Network report is not a TCMS endorsement of ACOs and/or capitation contracting. Richard Morris, M.D., who is a member of the TCMS Policy Committee, offers his counterpoint and caveats for physicians and patients (page 8).

These discussions stir emotion in TCMS physicians who re-member the Hennepin Medical Society sponsored Physician’s Health Plan (PHP) HMO in the 1970s. PHP was touted to be the physician HMO with the imprimatur of the medical society to compete with Minnesota’s dominant HMOs in order to assure and protect physi-cian interests. There are lessons to be learned from the PHP history. Aaron Nathenson, M.D., with contributions from James Ehlen, M.D. and Doug Shaw, snapshot the development of PHP and give their perspectives (page 10).

Accountable Care Organizations (ACOs) are legislated in the PPACA and its administrative rules. ACOs have as their primary goal controlling health care costs by using population-based capita-tion payments to provider organizations. David Moen, M.D. is on the front line in implementing a Fairview Health System ACO. In the Colleague Interview, he explains how a switch to capitation will require changes in health care delivery as he fields questions from the Editorial Board (page 12).

Twin Cities medi-cal practices are devel-oping integrative care models and/or are considering how to interact with ACOs: The Hennepin Health Network is an innova-tive pilot project to integrate medical, be-havioral health, and human services for the lowest income public sector patients (page 15); The Collabora-tive Care Cooperative now with 17 members empowers independent specialty medical prac-tices to form Practice Cooperatives (page 17); Thomas Flynn, M.D., reports from Minnesota Oncology, a large independent cancer care organization, which is planning its own specialty ACO (page 19); and Scott Ketover, M.D., of Minnesota Gastroenterology describes issues and challenges of ACOs (page 21). A temporary Minnesota State budget surplus resulted in a some-what less contentious legislative session this year. Of note: The Min-nesota Board of Medical Practice is now required to publicly report physician malpractice judgements (page 24). Finally, Mitch Einzig, M.D, exemplary clinical teacher, is featured as this issue’s Luminary of the Twin Cities Medical Society (page 32). Plan to attend the MMA annual meeting, September 14-15, 2012 and serve as a TCMS delegate to the MMA House of Delegates. Your voice is important! Registration information is available at www.metrodoctors.com. And, if you’re moved to do so, send us a Letter to the Editor.


President’s Message

In Pursuit of Gigantic—but Hopefully not Titanic

pETEr J. DEHNEL, M.D.

This edition of MetroDoctors highlights some of the significant transitions that are occurring in the delivery of health care services both locally as well as nationally. Regardless of the Supreme Court’s decision on the 2010 “Affordable Care Act” legislation, change is going forward in

numerous ways. We have a whole new glossary of health care terms — accountable care organizations, clinically integrated networks, the triple aim, bundled payments for episodes of care, and so on. This is all supposed to be new and innovative — real solutions for improving the patient care experi-ence, improving population health and lowering the per capita increase in health care spending — aka “the triple aim.” To some, it is just the next logical iteration in transitioning to a systems approach to delivering consistent quality care. Conversely to some, primarily more senior members of the physician community, this seems like “déjà vu all over again” (Yogi Berra) with it looking much like old-style

capitation under a new name. In any case, it seems that consolidation and creating larger organizations is inevitable. In order to serve the needs of our physician community, the members of the Policy Committee of TCMS have diligently worked to create a “guide” or “tool” to aid in the understanding of the new structures that are being created and implemented. The “Twin Cities Network” has been developed with a foundational principle of physician leadership. This principle is seen as a distinct contrast to a number of the proposed ACO-type networks currently in development. The completed report has generated considerable controversy through its development. One of the prime issues is physicians assuming risk for managing a population of patients. Managing financial risk puts physicians in an ethically awkward position of potentially choosing between patients and profits — or even between patients and financial viability. Unfortunately, the risks for groups go far beyond financial, and that makes many of us extremely uneasy. Unrecognized risks can be illustrated through an example from the early twentieth century. One hundred years ago on April 15th, the luxury liner RMS Titanic sank after hitting an iceberg in the north Atlantic. There was the loss of 1,514 lives in this great sea tragedy. There were opportunities to avoid this disaster, of course, but one of the important unrecognized risks was the possibility that this “modern” ship could actually sink. Without that acknowledgement, there was insufficient life boat capacity for all of the 2,200 plus passengers and crew. Where are the risks associated with the accountable care organization concept? At least five are easy to recognize from the outset:1. Business risk — the risks involved with running any business, in that it may not be successful.2. Key concepts risk — a business may be based on an inadequate or erroneous foundation, such as capitation with too small of

population base.3. Investment risk — since loss reserves have to be held with any group taking on risk, the choices involved with managing those

investments can make or break your business.4. Care management risk — if an organization spends more managing its high complexity patients, it may fail financially.5. Insurance risk — depending on the size of a patient population, a disproportionate number of patients with newly diagnosed

hepatitis C, advanced multiple sclerosis or refractory Crohn’s disease or AML requiring a tandem (double) stem cell transplant can “break the bank,” even with significant stop loss insurance. This is why “larger” becomes an important principle for busi-ness viability.

These five, as stated before, are the ones easy to recognize. It is the unrecognized risks inherent within a specific organization that may be the biggest challenge at the end of the day. “Unsinkable” or “too big to fail” should never be assumed. That would be a titanic mistake. Stay engaged, stay informed, be proactive, and continue to focus on providing excellent care to your patients who continue to depend on you for their important health needs. TCMS continues to provide a venue for physicians to work collaboratively on these very important issues.


tCMs In aCtIonSUE A. SCHETTLE, CEO

Correction: In the May/June issue of MetroDoctors, Andrew Litchy, ND was incorrectly identified as Mr. Litchy rather than Dr. Litchy in his article author bi-ography, “What About the Integration of Naturopathic Medicine?” We apologize for the error.

TC NetworkThe TCMS Policy Committee focused a great deal of time and effort in 2011 and early 2012 to develop a tool for physi-cians who may be interested in what a physician-led network might look like. This was an exercise and not intended to be a platform for TCMS to actually create a network, but instead, to be used as a way to spark conversation and dialogue about physician-driven health care reform. Our 2nd TCMS Forum will be held on Wednesday, July 11 from 7:00 a.m.– 8:30 a.m. at Broadway Ridge, 3001 Broad-way Street NE, Minneapolis, and will be devoted to discussing the TC Network. We will have a panel of physicians discuss the pros and cons of a TC Network-like organization. We are hoping for a great discussion. Please join us! You can register by visiting our website.

Honoring Choices MNThe 3rd Annual Sharing the Experience conference will be held on Thursday, July 19, 2012 at the Ramada Plaza, 1330 In-dustrial Boulevard NE, Minneapolis from 9 a.m. – 5:00 p.m. Attendees will learn the progress and findings of featured advance care planning programs, hear updates from Honoring Choices Minnesota partners and insights from guest speakers, and network with others who are passionate about promoting advance care planning conver-sations in Minnesota. This event is always well attended and there are terrific lessons learned that are shared. To register visit the Honoring Choices Minnesota section of our website, www.metrodoctors.com. Deadline for registration is July 10.

The story of Honoring Choices Minnesota is contained within Chapter 4 of a newly

released book entitled Having Your Own Say. This book was published in partner-ship with our colleagues from LaCrosse, Wisconsin who founded the Respecting Choices advance care planning initiative. This book contains chapters from orga-nizations such as Dartmouth Institute for Health Policy and Clinical Practice, National Palliative Care Research Center, Center to Advance Palliative Care, in addition to highlighting activities that are going on in other countries including Aus-tralia. We are honored to have been asked to contribute our story to this book. If you are interested in buying the book, visit the www.havingyourownsay.org website.

healthy eating and active living offer-ings; investigating additional policies and practices where people live, work, eat and play; identifying efforts to provide access to healthy foods; and encouraging efforts to improve employee wellness among city-operated worksites. We were extremely pleased to be making tangible progress in our efforts to improve public health by advocating for healthy eating active living strategies. Tom Kottke, M.D. and Court-ney Jordan Baechler, M.D. are co-chairs of the Twin Cities Obesity Prevention Coali-tion and are helping to move the resolu-tion concept to other cities. The Eagan resolution idea was highlighted in the May 2012 consumer information guide called Minnesota Health Care News.

Be a DelegateHave you registered yet to be a Delegate to the MMA Annual Meeting? It’s not too late! The meeting will be held in the Twin Cities this year, at the Minneapolis Mar-riott City Center Hotel, Friday-Saturday, September 14-15, 2012. Submitted resolu-tions and registration information can be found on our website: www.metrodoctors.com.

Twin Cities Obesity Prevention CoalitionThe City of Eagan unanimously passed the state’s first ever Healthy Eating Active Living resolution at its March 20, 2012 meeting. The resolution was brought forward by the TCMS Twin Cities Obesity Prevention Coalition. Among the strategies called for in the resolution are: advocating for the continued sustainability of existing


TC Network:A Fictitious Organization...an Interesting Exercise

By roger Kathol, M.D., and ronnell Hansen, M.D., Co-Chairs

Medical Care Organizations

Through much of 2011 and early 2012, the TCMS Policy Commit-tee met and eventually developed a

report that was presented and recently approved by the TCMS Board of Directors. The report is called “Twin Cities Network” and was intended to be a resource for physicians and others who are exploring what a physician-led network might look like.

Executive SummaryIn this report, the Policy Committee of the Twin Cities Medical Society (TCMS) presents a physician developed model of care delivery intended to improve patient health, augment access to outcome based medical care, and decrease total health care costs. The model is generally consistent with desired outcomes associated with accountable care organizations (ACOs), though the Policy Committee specifi-cally chose to avoid using the politically charged term “ACO” and to call the product of their deliberation The Twin Cities Network (“TC Network”), a fictitious organization with a mission to create a sustainable network of practitioners that delivers effective, ef-ficient, and affordable care that leads to improved patient health. This report is written with the specific intent to contribute to improved health care in the State of Minnesota. The Policy Committee is not endorsing “ACOs” per se nor would it consider the development of a TC Network un-complicated or without risk. Rather, the Policy Committee, composed of practicing physicians, chose to enter into an intellectual exercise in hopes that it could provide a framework for what a physician-led network might look like.

The Policy Committee recognizes that there are many things that physicians and co-member-owners would need to keep in mind if they would enter into contractual arrangements similar to those described below. Singer and Shortell summarize possible shortcomings of TC-like networks uncovering 10 potential developmental mistakes that we have classified into three categories: 1) the over-estimation of organizational capabilities (abil-ity to manage risk, to develop and use EHRs, to measure performance, and to standardize care management protocols), 2) the failure to balance the interests and engage stakeholders (mistakes six to nine — not representing in-terests of primary care physicians, specialists; not engaging patients; not using cost-effective specialists; ineffectively navigating regulatory and legal issues; and not truly improving the delivery of care), and 3) the failure to recognize that failure in one area could magnify failure in another. In other words, there are upside and downside risks associated with the development of collaborative health systems, such as the TC Network. Nonetheless, the Policy Committee generally agrees that providing creative and proactive physician input is essential for any chance of success in moving to a health system that improves the patient experience, fosters patient and population health, and lowers total health care costs. The purpose of this fictitious TC Net-work is fourfold: 1) to empower physicians to become active participants in the development of an improved health care system; 2) to pro-vide a “clinical” metropolitan physician-based perspective of a vision for better care delivery and complementary payment procedures; 3) to inform lawmakers, the health care industry, and the public about potential directions that physi-cian envisioned health reform should take; and

4) to stimulate discussion among physicians, their patients, policy makers, politicians, and health care industry stakeholders, including hospitals, health plans, employers, and gov-ernment agencies, about health care reform alternatives. The TC Network describes a collaborative, clinician-based, and outcome-oriented care team delivery process. Primary and specialty clinician equity member owners create the inte-grated care delivery vision. They work with TC Network business administrators, non-clinician member owners, and patients in collaboration with clinician and non-clinician contracted providers and industry stakeholders to opera-tionalize an infrastructure of coordinated care that has at its root the patient centered health care home (PCHCH). PCHCH practitioners then coordinate work processes with medical specialists and health facilities using customized TC Network payment procedures that encour-age quality-based, rather than volume-based, long term patient-centric and cost reducing integrated care.

The TC Network — ClinicalThe Policy Committee first discussed and cre-ated its vision of a physician-driven delivery system that would promote patient health. The principle clinical components of a “mature” TC Network would include:• Ahealthcarehomebaseforpatients’ser-

vice delivery and care coordination, which includes: 1) preventive care, 2) routine/acute care, and 3) chronic/complex care components.

• TCNetwork-basedmedicalteamcontri-butions (e.g., nutritionists, care manag-ers, pharmacists) to clinical settings (e.g., PCHCHs, specialty clinics) in a way that maximizes patient outcomes.


• Coordinationofpatient-centeredhealthcare homes, specialty medical care, includ-ing mental health and substance abuse, and facility care through a TC Network communication, referral, and IT system.

• Coreprimarycareandspecialtyphysicianleadership (member-owners) in collabora-tion with patients and other health care stakeholders (potential member-owners) willing to commit to a team culture of TC Network-designed integrated care delivery and reimbursement procedures with a patient outcome and population health focus.

• Contractingwithessential“non-member”specialty physicians; health service facili-ties/organizations (e.g., hospitals, hospice, nursing homes) and/or medical vendors; (e.g., pharmacy manufacturers, medical suppliers) that are not “at risk” but are willing to accept TC Network contract clauses, use TC Network IT documenta-tion, adhere to TC Network care delivery workflows, and/or follow communication expectations as a part of integrated team care.

• Inclusionofpatientincentivesforhealthybehaviors and outcomes.

The TC Network —AdministrativeOnce delivery system components had been conceptualized, the committee then discussed capitalization options, payment reforms that would foster desired delivery workflows and outcomes within the TC Network as well as gain/loss sharing. The principle administra-tive components of a “mature” TC Network would include:• Anincorporatedmember-ownedcompany

called “The TC Network” which “sells” coordinated care delivery by a network of providers to patients and populations of patients.

• CentralizedTCNetworkadministrationand information technology (IT) owned by equity member-owners and used by all member-owner and contracted partners.

• Contractingwiththird-partyadministra-tors to pay TC Network member-owner and non-member-owner practitioners and facilities using TC Network payment pro-cedures designed to facilitate and foster

the delivery of efficient and effective, non-volume-based inpatient and outpatient quality care with minimum hassle for clinicians or patients.

• Gain/losssharingfor“atrisk”member- owners.• Predetermined upside limit on TC

Network cost savings distribution to member-owners in the form of bonuses before gains are reinvested in new patient care programs or pre-mium reductions.

• Purchase of reinsurance to prevent catastrophic downside risk.

Full ReportThe full TC Network report can be found on our website: www.metrodoctors.com. A TCMS Forum will be devoted to dis-cussing the TC Network including a discus-sion about the pros and cons. Please attend on Wednesday, July 11 from 7:00 a.m. – 8:30 a.m. at Broadway Ridge, 3001 Broadway St. NE, Minneapolis, MN. Register on our website: www.metrodoctors.com.

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Counterpoint to the TC Network Report on ACOs

By richard J. Morris, M.D.


Counterpoint to the TC Network Report On ACOsIn the movie about the Watergate scandal “All the President’s Men,” Deep Throat said to investigator Bob Woodward: “Just follow the money.” That would be good advice for investigators of Accountable Care Organiza-tions (ACOs). Few physicians understand the implications of ACOs, born of thousands of pages of legislation and regulation. I believe ACOs threaten our profession and the patient-physician relationship. The Twin Cities Medical Society, recog-nizing the complexity of the Patient Protection and Accountable Care Act (PPACA), charged its Policy Committee to develop an educational paper for physicians, which emerged as the “TC Network” document (TCN). I, and some other members of that committee, believe the docu-ment fails to provide an informative balance of pros and cons of ACOs, unrealistically down-plays the financial risks for physicians, and promotes a myth that physicians can control ACO governance. Its vision would practically guarantee the demise of independent practice. Though the TC Network is described as a “ficti-tious organization,” accepting its assumptions is playing with fire.

Payment for “Quality”? The PPACA created incentives for integrating physicians and hospitals into large health care networks on the premise that integrated care systems will cost less. Despite the fact that the demonstration projects have been failures by and large, the beat goes on. Quoting the TCN document: “TC Network payment pro-cedures (are) designed to facilitate and foster the

delivery of efficient and effective, non-volume-based inpatient and outpatient quality care with minimum hassle for clinicians or patients.” Right. Wanna buy a bridge? Quality is near-impossible to define be-cause of the daunting issues of ever-changing medical evidence, risk adjustment of different patient populations, and patient attribution to providers. Published studies have failed to con-sistently prove any association between quality measures and cost reduction — a reality over-looked by the TCN fiction. Bob Woodward said: “If you’re gonna hype it, hype it with the facts.” The TCN report presents no evidence that ACOs achieve higher-quality outcomes less expensively because there isn’t any. Their mantra “paying for quality” is a glib euphemism for cutting payments.

Hazards of Integration: “Follow the Money”Integration requires great gobs of money to comply with the law. Therefore the owners of ACOs are necessarily those with big money, i.e. hospitals, insurance companies, government. ACOs turn the health care paradigm upside down. Heretofore patients were at the top, with physicians and hospitals serving them, and payers at the bottom doing the financial transactions. With ACOs, the moneyed inter-ests are at the top, the “health care team” bows at their altar, and patients beg us for service. Our sworn obligation is to the patient. The PPACA puts physicians financially at risk for their performance, which is why we will be under pressure to serve Mammon. The most-discussed payment scheme is “global payment” which is capitation by another name. Capitation creates an irreconcilable conflict for physicians, who stand to make or lose

personal income depending on the care they order. (Some say FFS presents a conflict too, but there’s no moral equivalence to being paid for withholding care.) Capitation was rejected by patients and physicians after the misadven-tures of the 1990s. It challenged the mutual loyalties of physicians and patients, and divided primary care and subspecialty physicians. Putting an ACO at capitated risk effec-tively makes the ACO an insurance company. But ACOs don’t have a statutory obligation to maintain financial reserves like those required of insurance companies, leaving physicians and patients vulnerable to financial swings. Medical insurance companies and HMOs, likely to own many ACOs, would be able to pass off their financial risk to ACOs. The TCN report doesn’t acknowledge this risk. The barriers to entry into health care competition are such that there will be fewer, larger organizations. Some wonks think our whole country may consolidate into four or five mega-organizations. Patients will be the big losers, with physicians close behind. The federal government has modified anti-trust rules so competitors can integrate into an ACO. But it is basic economic dogma that competition is necessary to keep prices low. Without competi-tion, government must centrally control prices. That is economically unsustainable. The fictitious TC Network is well-in-tentioned but is naïve. Why would investors cede control of governance to physicians? That’s not how capital investors work. And why would anyone invest anyway since profits will be unlikely, given the added costs of: hir-ing care coordinators, navigators and patient coaches; installing and maintaining complex information systems; and hiring many more


administrators and technicians. Of course, stinting on physicians’ salaries would be the easy answer. The utopian TCN document pro-poses ways “excessive profits” (huh?) could be distributed, including rebates to payers and patients, a fable designed to attract the unin-formed. Like risky medication, the document should come with a black box warning.

The TCN report is said to be an “exer-cise” to stimulate discussion, but if it has the imprimatur of our TCMS, policy makers, payers and uninformed physicians will think ACOs are approved by our physician society. Ignoring the possibility of that misperception is disingenuous.

Take-home PointsThere’s nothing inherently wrong with the idealistic concept of integrated care systems as envisioned by the TC Network report. What’s wrong with its vision is that it repeats the rheto-ric that physicians are to blame for the high cost of health care, so it rearranges the hierarchy to put the interests of physicians, and in signifi-cant measure patients, at the bottom. The TCN

myth ignores insurers’ greed and bureaucratic inefficiency for driving up health care costs. It condones layers and layers of new bureaucracy and investor ownership that will engulf any potential clinical savings, could sacrifice the ideals and incomes of the medical profession, and will put ethically-challenged controls be-tween physicians and patients. All without a consensus of published evidence that ACOs save money. I worked in an integrated system for 10 years and was on its management com-mittee for six. I know the inefficiencies of large integrated organizations. There is a place for them in the landscape as an alternative, not as the only game in town. If independent prac-tices disappear, where will all the disgruntled patients and employed physicians go? Shouldn’t there be more proof of the ACO concept before we turn American health care upside down? Shouldn’t the Board of TCMS have demanded more balance in the TCN document before releasing it to the world?

Patients could be the biggest losers in this inchoate new age of medicine. They don’t want Congress (the “Patient Protection…Act,”

mind you) to tell right-thinking physicians how to give efficient care. There are enough cost-saving opportunities, like generic medicines, evidence-based care (the TCN reformers made no mention of the billions of dollars spent on unproven alternative care), appropriate use of ERs and hospitals, and market improvements like health savings accounts — we don’t need political and corporate prescriptions for our profession. If physicians become commodities for sale to the financial and political interests, we will lose our ethical and professional souls and alienate the patients we’re sworn to serve.

In the movie, Charles Colson, special as-sistant to President Nixon, had a cartoon on his office wall saying, “When you’ve got ’em by the balls, their hearts and minds will follow.” Take heed.

Give your feedback to TCMS c/o [email protected].

Richard J. Morris, M.D., member, TCMS Policy Committee, and Board of Directors, Minnesota Physician Patient Alliance.

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Health Maintenance Organizations —Improving Cost, Care or Neither?

By Aaron Nathenson, M.D.

Managed care has had a long history in the Twin Cities area and one of the most controversial devel-

opments has been the health maintenance organization (HMO). Most health insur-ance companies offer some form of HMO coverage. The popularity of these plans is based on a concept of early and easy access to providers for members. This is coupled with prevention, treatment of medical problems, first dollar coverage and hopefully, reduction of premiums to employers and employees. HealthPartners (Group Health) was one of the first closed panel medical groups that did not use fee-for-service as its means for reimbursement. Rather, it used a preset fee system for financing this plan. This first occurred in 1939. It was not looked upon favorably by many private practice, fee-for-service physicians as they felt that the quality of medical care practiced by the closed panel HMO may be less effective than the care given by fee-for-service physicians. After World War II an increased inter-est in the HMO occurred. Employers were concerned about the rising costs of medical care. There was an explosion of new medical technology combined with the advancement of medical treatments for many disease con-ditions. General Mills spearheaded the search for new forms of health care delivery through the Twin City Health Care Development project. A think tank headed by Dr. Paul Ellwood and Dr. Walt McClure began to develop interest in managed care. Dr. Ell-wood was the first to popularize the term health maintenance organization (HMO). In

1972 both the St. Louis Park Medical Center and the Nicollet Clinic fee-for-service multi-specialty groups, formed HMOs (MedCenter Health Plan and the Nicollet-Eitel Health Plan).These initiatives were in response to a growing competition with Group Health in their local area, and viewed as a way to attract new patients by working closely with major employers in the area. In the mid 70s members of the Hen-nepin County Medical Society (HCMS), particularly those in smaller and single spe-cialty practice settings, became concerned about the competition for patients with the rapidly growing HMOs in the Twin Cities area and, in response, decided to develop an open panel HMO, or Independent Practice Association (IPA). Private physicians and Twin Cities hospitals were included in the plan. Thomas Hoban, who was the CEO of the medical society, was instrumental in developing the new HMO plan, named Phy-sicians Health Plan of Minnesota (PHP). Eventually, the Federal Trade Commis-sion became concerned with potential medi-cal monopoly and restraint of trade issues in the Twin Cities, as well as in other areas of the country, strongly advising that these plans be shut down or their ownership and control transferred to entities not controlled by medical societies or principally dominated by physicians. While not necessarily agreeing with the concerns expressed by the FTC, the cost and commitment of time needed to defend PHP as a medical society venture was simply not sustainable. Accordingly, it was determined that governance of the open panel HMO should immediately become the responsibil-ity of a consumer-majority Board. Physicians

who remained involved in governance would no longer be selected by the medical society.1

Richard Burke, the CEO of Charter Med, a for-profit management company that provided management services for PHP, was then selected as the CEO of PHP. (Charter Med would later become United Health Care.) HMOs grew rapidly during this period of time. By 1984 PHP had grown to be the largest HMO in Minnesota with 50 percent of the metropolitan HMO market and 25 percent of the Medicare subscribers in the Twin Cities area. Medicare patients com-prised 30 percent of the private physician’s volume.1 The competition for patients caused various health plans to develop new programs to attract more patients. One of the pro-grams PHP started called SHOP rewarded Medicare patients if they used designated hospitals for care.2 The plan excluded five



hospitals in the Twin City area. The purpose was to strengthen PHP’s negotiation power with the contracted hospitals in affecting rates for their Medicare patients. Physicians who utilized these excluded hospitals were concerned that they would lose their Medi-care patients. The chiefs of staffs of these five excluded hospitals felt obligated to explore and understand why this course by PHP was necessary. Four of the five chiefs of staffs formed a committee to gain information from the Board of PHP as to how governance and business decisions were being made. Several law firms were interviewed to advise the com-mittee on how to approach the organization. A law firm was selected and the committee was structured to have an executive commit-tee and an advisory group of 20 physicians from throughout the Twin Cities. The group adopted the name of PHP Oversight Com-mittee. All the physicians on the Oversight Committee were physician providers of PHP. Over the next 18 months PHP and the Oversight Committee battled in the press and in court over issues of accessibility to PHP Board information. Additionally, the PHP Oversight Committee identified the role of Richard Burke as CEO of PHP and Charter Med as representing a conflict of interest. Three lawsuits developed during the months of confrontation. The Oversight Committee started a process to recall the Board. At that point Governor Rudy Perpich interceded and had the Attorney General and Commissioner of Health moderate an agreement between the PHP Oversight Com-mittee and the PHP Board. Negotiations were completed with compromises from both sides. A new PHP Board was formed and PHP remained a strong HMO in the community. Many years have passed since the dis-pute between the Oversight Committee and the Board of PHP. PHP merged with Share Health Plan to form Medica, which remains a strong HMO in the Twin Cities today. Although managed care has become an accepted fact in today’s health care envi-ronment, concerns remain about the cost of medicine to employers and individuals and is one of the leading issues in current health

care policy debates. The HMO model has been a disappointment as a means to con-trol health care utilization and cost. Lack of health insurance to 40 million Americans is a burden that both local and federal officials must deal with. Americans now spend 17 percent of gross domestic product on health care and as a country we rank 32nd in the wellness measures globally.3 A single payer system and a national health insurance plan are on the horizon. The present health care delivery system needs to be changed and new ideas and systems need to be implemented to protect the health of all citizens. The most significant lesson learned, in my opinion, from watching the development of managed care systems is the need to be aware of conflicts of interest. Medicine is big business and there will always be conflict between management and providers. It is my observation that restricting utilization and limiting care is a means to keep costs controlled and bottom lines in the black.

The health and care of patients should not be just a business decision, but needs to include a medical decision that uses evidence-based studies, appropriate technology and diagnostic testing, and sound judgment by physicians.

Aaron Nathenson, M.D. is former chief of Ophthalmology at Hennepin County Medical Center and is an associate professor of Oph-thalmology at the University of Minnesota. He served as one of the chiefs of staffs on the PHP Oversight Committee.

K. James Ehlen, M.D., member of the PHP Oversight Committee (eventually serving as chairman and CEO of PHP) and Doug Shaw, former associate director, Hennepin County Medical Society, contributed to this article.

References1. City Business, Wayne Nelson, circa 1985.2. Minneapolis Star Tribune, Tuesday, June 3, 1986,

Gordon Slovut, page 6D.3. Minneapolis Star Tribune, Tuesday, May 1, 2012,

Paul Olson, Opinion Page A9.

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We have heard of the promise of the ACO. What are pos-sible perils to the providers and the patients?

I think the biggest possible peril is if we as clinicians and our patients as community members don’t embrace this time as an opportunity to really change the system. We can’t wait for others to fix the problem. If we make a payment switch to capitation without changing the care model and engaging the community in helping us establish appropriate incentives and expectations for patients/community we will have a repeat of the 1990’s managed care era. So in short, our biggest peril would be lack of engagement and leadership of clinicians, patients and our com-munity in creating a sustainable approach to improving all of our health.

Is there a core set of contract attributes physicians should be aware of?

Contracts at this stage of the game must be framed in meaningful met-rics that help us achieve high quality experiences and health outcomes at an affordable cost. We are early in really understanding how best to measure this and translate that into our contracts. It will be critical to discover better ways of measuring meaningful outcomes in less burden-some and costly ways and translating that to aligned incentives designed to achieve the right goals.

What crucial and/or unique operational capabilities must be in place for a clinic to succeed in an ACO?

Critical capabilities include:• effective patient engagement approaches and relationship

management• accesstocareattherighttimeintherightplacewhenneeded• clinicalleadershipalignedtoengagecliniciansandmanageperfor-

mance to Triple Aim• accesstohealthdataforriskstratificationofpopulation• proactiveoutreachandcareplanningforhighriskpatients• team-basedapproachesandcaremodelsadaptedforuniqueneeds

of complex patients• reactiveoutreachforpatientswhoexperienceanacutechangein

health status• partnerships that facilitate care transitions across the entire

continuum• contractsthatalignincentivestohelpachieveaims

Required guidelines-measures: who has vetted these and are they accepted on our behalf? By whom?

This is a great and complicated question. Multiple people have vetted different aspects of these capabilities but we are early in really under-standing which ones are most meaningful and effective. For example, we know that patients are more likely to engage with care management staff connected to and trusted by their care giver. We still don’t have as

Colleague Interview: A Conversation With David Moen, M.D.

David Moen, M.D. is currently president and CEO of Fairview Physician Associates, a non-profit physician hospital organization. He also serves as chief medical officer of NetClinic, Inc., a web-

based program that serves as an interactive personal health portal to allow virtual care delivery involving patients and clinics. Prior to his role in health care innovation, Dr. Moen led emergency services in two Fairview outstate locations. Dr. Moen earned his medical degree from the University of Wisconsin School of Medicine and completed his residency training at the University of Minnesota Family Medicine and Community Health. He is board certified in family medicine.


(Continued on page 14)

accurate of predictive models as we need. Therefore, we are still learn-ing more about who to engage with and which interventions truly help us drive value to the patient and the population. Part of our struggle is that all of these capabilities cost money. Figuring out which to invest in and how to pace that investment is difficult. I do believe that the only way to learn is to get started, measure, and learn from and share our mistakes and successes.

Can a physician participate in more than one ACO? (A single specialty group for instance.)

Specialty physicians can participate in more than one ACO as they are designed today. The current model is more challenging for primary care physicians, however. Most independent physician groups desire to maintain choice for their patients. I believe it is very important to maintain as much choice as possible in the system.

Could you provide more detail and intent regarding in-dependent physicians as partners in Fairview’s and other ACOs? What risks do physicians and practices enter into with an ACO program?

We are all at risk for our ability to adapt and perform. Groups unwilling to have conversations with each other and their partnering organizations about what is working and not working and adapt going forward will likely have problems. Mutual commitment and trust are essential here.

The government or other third party payers will be defin-ing expected or average anticipated costs for a population. Must we accept their calculations? Do we have any mech-anism to challenge assumptions such as severity indexing accuracy? Do we have the capability to internally predict population expense on an annual basis?

Tough to provide a blanket answer to this one. Smart people in dialogue willing to adapt as we move forward is the only approach that makes sense. There are many unknowns and much to learn. This is not busi-ness as usual and if it is, it will not work; collaboration and ongoing dialogue are essential with mutual commitment to achieving intended results. Sound aspirational? Yes. Achievable? Yes.

How does “Meaningful Use” fit into the ACO structure/function?

I am certainly not an expert in meaningful use but I will share my perspec-tive as it relates to building infrastructure in our current environment. Requirements to achieve meaningful use funding were designed to enable us to establish key parts of infrastructure that hopefully are meaningful! There is a hint of sarcasm there in that I am not always sure that what we have decided is meaningful is really going to make a difference in the long run. What I hope is that we continue to achieve meaningful

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Colleague Interview

(Continued from page 13)

standardization where it produces value and allow variation where that produces value. This is a journey in my mind.

Please address the necessary process(es) involved to: ar-rive at a capitation contract with a group of providers; make provisions for “secondary” insurance to cover cost overruns; and provide financial incentives for employed physicians and for network contractors.

This is also a very complicated question to answer in a paragraph. Said simply (and probably inadequately), it is critical to have an understand-ing of the scope of the population in the contract and an understanding of the care delivery assets required to serve that population. It then requires smart financial/actuarial people to figure out how to manage risk unrelated to performance and align incentives and management to improve performance. In this area, too, there is a lot of work to be done.

How is the partnership between Fairview and Medica go-ing? How is “success” in containing costs being measured?

Fairview is partnering differently with all health plans. What is most satisfying to me is that we are talking more about how we work more effectively together to serve our community. All our mission statements

say that in one form or another and it feels like we are acting more that way than we have in the past. Our conversations with Medica started earlier as we both were willing to lead a change for the benefit of all our community. We are farther along with Medica and PreferredOne in developing products for the market but all health plans want to do this work with provider partners. Success in containing costs in all our contracts with health plans is being measured based on projected cost trends based on risk of popula-tion served and market inflation vs. our performance against that trend. All contracts assure that quality and experience are rewarded and aligned as well.

In your opinion, will independent medical practices in the Twin Cities of necessity affiliate with a health plan network or ACO similar to those offered by the Fairview system in order to survive financially?

I am not sure about this one. I do believe an affiliation has advantages in sharing some of the costs of necessary infrastructure to better serve populations of patients. I also know the independent physicians really value their ability to adapt and adjust their practices to meet their busi-ness needs. From what I have seen, the independent practices that are around today have done a great job of adapting to changing environ-ments in this market. I would like to see the system continue to evolve so that independent practice remains a vital component of our system.

What might the metro health system ACOs do collectively to aid the provider community and the general population?

Across all health systems we are having this very conversation. One of our biggest frustra-tions as providers in this community is the complexity of the payment system for patients and clinicians. Interestingly, one of the biggest frustrations for payers is the complexity of the provider system for their members. As our health care system has gotten more complex (increased treatment options, products, etc.) we have not effectively reduced complexity for the users (patients and clinicians) of the system. Emerging Themes: Today’s model is too complex and cumbersome for patient and cli-nician users. We need to identify those things that have been created to benefit or make easy for non-patient and clinician stakeholders in the system that increase complexity for the ultimate users. Single-payer systems will have to emerge if we can’t identify common elements in a payer and data sharing framework that we all embrace in today’s system. Common attribution model is a good example.


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By Jennifer DeCubellis, LpC

Hennepin HealthAn Integrated Health Care Delivery Network

(Continued on page 16)

Imagine being worried about where you were going to sleep tonight and how you were going to get your next meal.

Checking your blood pressure and medica-tion compliance pales in comparison to a life in crisis. For our lowest income Medicaid recipients this is often the failure of health care. Hennepin County, in partnership with the Minnesota Department of Human Ser-vices (DHS) are working together to turn the system around with a Medicaid Demonstra-tion project, Hennepin Health. Hennepin County’s integrated health care delivery network is designed to serve the unique needs of one of the most chal-lenging and costly segments of the county’s safety net population. By integrating medical, behavioral health, and human services in a patient-centered model of care, the project seeks to improve health outcomes dramati-cally and lower the total cost of providing care and services to this population. As a safety net provider, Hennepin County is uniquely mo-tivated to reduce costs, improve outcomes, impact lives/communities, and ensure that cost shifting does not occur. This social disparities approach to health care is based on the premise that treating a safety net patient’s medical problems without addressing underlying social, behavioral, and human services barriers and needs, produces costly, unsatisfactory results — both for the patient and the programs providing and paying for care. Providing services to help individuals meet their basic needs (food, housing, financial assistance, transporta-tion, etc.) is critical to engaging this popu-lation successfully into health care services. Education on resources, assistance linking to

these resources, as well as general education is critical to improving individual investment in health. Identifying where the system has failed to meet individual needs is imperative. Individuals do not seek crisis care because it is what they value, they do so because the system does not meet their needs. We have engaged patients to discuss the “why” be-hind crisis care being the primary mode for engagement in health care and have learned everything from: same day access (we have hence created walk-in capacity at commu-nity clinics); open 24 hrs. (we have extended clinic hours, 24/7 nurseline, and are working on expanding access further to address this need); lack of reliable transportation (we have ensured bus passes are available where needed, prescheduling of rides, connected to services in shelters, are delivering medications to some venues vs. individuals not taking them due to transportation concerns). The common thread missing in crisis services that individuals want and is our “link” to primary care is the relationship — building a system with easy access where in addition,

the staff know the individual and there is a relationship which is critical to changing crisis behaviors, improving health outcomes, and reducing costs for this population. As of January 1, 2012, Hennepin County implemented a health reform ini-tiative in partnership with the Minnesota Department of Human Services, targeted at ~10,000 individuals per month. The initial focus population is 21- to 64-year-old adults, with no dependent children in the home, living in Hennepin County, with incomes at or below 75 percent of the Federal Poverty Guidelines ($677/month or $8,124/year for one person) who qualify for Medical Assis-tance (MA). This population often receives minimal preventive care, is at high risk for acute care needs, and has poor health out-comes and health status. Lack of data sharing supports, the lack of policy and payer supports, and general sys-tem buy-in has prevented the County from launching a program such as this in the past. The current health care reform environment has heightened awareness, urgency and a path to pursue such changes. In addition, economic downturns have further forced health care to look at systemic issues as a means of survival. Hennepin County entered into a full risk contract with DHS and is receiving the same rate as the area health plans to man-age this population differently. The hope is that the project will demonstrate overall cost reductions while increasing preventive care and positive patient outcomes. It is a one year contract with a one year renewable option. One critical component for success is


Hennepin Health


an integrated system of providers. Henne-pin Health has four internal partners and a growing list of external partners; however, in comparison to traditional networks, this is a smaller defined network focused on out-comes. Internal partners consist of:• Hennepin County Medical Center

(HCMC): a 477-bed safety net Level 1 Adult trauma center with a robust network of primary and specialty care clinics throughout Hennepin County.

• NorthPointHealth&WellnessCenter: a Hennepin County full-service outpa-tient primary care clinic and Federally Qualified Health Center (FQHC), certi-fied as a health care home.

• HumanServicesandPublicHealthDepartment (HSPHD): social service functions for Hennepin County.

• Metropolitan Health Plan (MHP): The County’s HMO which provides the administrative services for Hennepin Health (network management, claims payment, member services, etc.).

Though Hennepin Health has four core partners, the population has expansive needs, such as dental care, transportation, mental health care, vision, housing, home care, and rehabilitation services, and the treatment model must address such needs. Hennepin Health is working with over 50 community providers to define outcome driven collabora-tions. The extended partners are critical for ensuring service provision in the enrollee’s community, ensuring continuity of care with changes in benefits and/or health status, and ensuring sustainability of the system. The extended partnerships form the foundation of a larger state-wide care system that allows for replication of the model to additional payer sources and communities and ensures scalability to additional populations. Early learnings have been many and continue to evolve monthly. An initial fo-cus on the top 5 percent who are utilizing >64 percent of total funds has been critical. These patients are utilizing high levels of cri-sis services, as well as often moving between multiple providers and multiple pharmacies with a result of fragmented care and poor outcomes. Interventions focused on linking

these individuals to a health care home and coordinating service needs have been crucial as a means to get better outcomes. Initial internal measures are focused on reductions in crisis levels of care (ED, Inpatient, Cor-rections, etc.) and increases in preventive services such as engagement in health care homes/primary care settings. We also uti-lize community measures to look at specific disease management outcomes utilizing a patient registry. Another critical measure is “churn.” Individuals on Medicaid typically stay on benefits for eight months before they fall off; >15 percent of this population is dropping monthly due to not completing re-newal paperwork. We are working with DHS to impact this through provider supports for onsite renewals at the time of care. We are tracking drop rates in hopes of keeping more individuals engaged in care as a means to reduce health disparities over time. We have captured baseline data on member’s utiliza-tion of health care and social services when they enrolled and will re-test these baselines each quarter to determine impacts. Another initiative focuses on the ideal of one patient record. The importance of sharing information across systems to un-duplicate care is critical to bending the cost curve and improving outcomes. One example is a patient in our shelter who was identified as having five caseworkers at one time across various systems — none of whom knew the others existed and whose unaligned work was often contradictory. Hennepin Health is working to create one record so services are coordinated in a seamless manner. Hennepin Health is looking at effective Medical spends — this often means using health care dollars to avert medical complica-tions. With 32 percent of our population in “unstable housing” health care at area shelters is critical to ensure patient access. Medication delivery to shelters is being tested to improve adherence and reduce transportation barri-ers, which may further reduce ambulance runs to the emergency department. Average hospital lengths of stays are often doubled due to placement challenges for persons with behavioral needs, brain injuries, forensic his-tory, to name a few. Housing supports help place individuals and keep them housed and out of hospitals and EDs.

One of the top non-emergent ED visits is for dental pain. Instead of prescribing pain meds, Hennepin Health is attaching dental care near the ED and ensuring same day ac-cess. Persons presenting in the ED for dental pain no longer get an ED charge and pain medications, they are walked to the dental clinic for care. By doing so, we reduce ED costs and avoid pain medications which of-ten exacerbate chemical dependency issues. In addition, dental care needs are assessed by providers at all points of service. Once a need is identified, HCMC and NorthPoint both provide dental care onsite and we have contracted with Delta Dental for expanded service capacity and location. Challenges exist around this new terri-tory specifically around defining data sharing parameters. There exists data sharing regula-tions around health care data and welfare data, but there are not clearly defined rules when you cross these two worlds. Hennepin Health’s success is highly dependent upon quick data access to drive system changes and inform providers. Hennepin Health is working with DHS to better define these pa-rameters within integrated systems. Knowing who is utilizing high levels of care and why is imperative for health care improvement plans and cost reductions. We cannot change what we don’t understand. With data, we can turn the system around. Hennepin Health is working on real time provider and patient dashboards to guide health and outcomes. As a safety net provider, Hennepin County is excited to be a part of health care reform. This is a great opportunity for inno-vations to reduce costs and improve outcomes for our patients and our communities!

Jennifer DeCubellis, LPC is an area director in Human Services and Public Health for Hen-nepin County in Minneapolis, Minnesota with responsibility for health care reform. Jennifer leads Hennepin Health, an initiative to im-prove system efficiencies between multiple public sector agencies as a means to improve patient experiences and reduce costs. Jennifer has spent the last 18 years in health care administration with an emphasis on program redesign, system efficiencies, and quality improvements.



Collaborative Care Cooperative

In 2011 a group of leading independent specialist practice leaders began to meet on a regular basis to discuss

what our future role would be in a “reformed” health care market. We all shared a concern not to repeat some of the past mistakes of older managed care designs and we were commit-ted to embracing the new possibilities. Our first challenge was to establish a legal organiza-tional structure that would allow independent practices the ability to work in collaboration toward managing cost, improving quality and providing excellent service. A Provider Co-operative gave us the shared ownership and organizational structure we were looking for. Provider cooperatives are covered by a separate Minnesota Statute (62R). The state recognizes the value of physicians collaborating in this way so regulatory prohibitions on working together are significantly lessened. There are both common and preferred shareholders with one vote per common share. Common shares are held by the group practice and provide equal voting rights. The governance structure includes an elected Executive Committee and a 13 member Board of Directors.

With the rapid pace of changes happening in health care, we were acutely aware of the importance of developing a communication and messaging plan to clarify our purpose, goals and strategies. The Co-op provides patients, purchasers and payers with easy access to over 500 medical specialist providers. The Co-op fo-cus is on how medical specialists interface with primary care, hospitals, purchasers and payers. Co-op specialists will “wrap around” medical homes assisting them in meeting their quality standards, cost of care targets and coordination

of patient care. For larger integrated delivery networks, the Co-op can provide a plug-in model which can be customized/scaled to the need of each specific system. Specialists can operate most efficiently within their own scope of practice and are very responsive to ever-changing patient needs and treatment options.

Payers, including both public and com-mercial, have delivered the first round of per-formance-based contracts into our health care market. They tend to lean heavily on primary care. There is considerably less focus on spe-cialty care. We certainly support the emphasis on primary care and using a medical home model of care is certainly appropriate for mea-suring larger attributed populations. There is, however, a missed opportunity when the spe-cialist is not fully engaged. When patients are faced with the need for acute or trauma care or care for a chronic disease their utilization of services increases and they are typically seeing a specialist. Specialists can have a profound effect on the cost of care and quality of care. The site of service alone can have a huge affect on the cost procedures and diagnostic tests. In addition, the development and adoption of clinical guidelines, alternative pricing formulas including “bundling” of care can result in more predictable costs. We are engaging with ACOs and similar Integrated Delivery Networks (large and small) to work in these areas. While all of our shareholders work individually with most networks, our interest is to move the relation-ship to the Co-op level where additional value can be achieved for these networks and our shareholders alike. We have recently entered into our first partner agreement with Integ-rity Health Network in Greater Minnesota with over 250 physicians. We have also begun working with some health plans to develop our own analytics surrounding utilization and total

cost of care. These health plans have expressed interest to feature Co-op network specialists within their insurance products. Shareholders are now using the Co-op to develop large scale quality outcome measure-ments. For example, our orthopedic share-holder practices are collaborating to create meaningful outcome data from patients who have undergone total knee replacement pro-cedures. This is consistent with Minnesota Community Measurement and the Minne-sota DHS mandate. We have consensus on the survey instruments, survey time intervals, patient demographics, software and analytics. By using the Co-op shareholder members can create efficiencies, standardize patient demo-graphics/profiles and significantly increase the pool of patients under study. Conducting post procedural/surgical outcome studies requires periodic surveying of the same patients over time. The expense is significant and the state mandate unfunded. While shareholders still individually absorb these costs, the Co-op has become a valuable resource creating efficien-cies and standardization. We will continue to produce more specialty care quality studies.

(Continued on page 18)By Douglas Hanson, MpA


Collaborative Care Cooperative


Future plans also include improving integra-tion and care coordination with primary care. Advancements in information technology is a significant and a differentiating factor in the delivery of health care today. We have very sophisticated electronic medical record (EMR) technology in most practices. We clearly are in an improved position to capture data, apply analytics and create meaningful information. There remains, however, a significant missing piece of infrastructure and that is full interop-erability. The ability to move data easily from one EMR to the next is still largely missing. To many of us it appears the technology industry which we depend on has become the obstacle in getting us to full interoperability. As competing vendors jockey for market share there is little interest to spend resources or extend service that may advantage a competitor. It would be good to see more collaboration within the information technology industry on this front. In the meantime the Co-op has invested in a physician-to-physician communication application called the Care Team Conferencing (CTC) Tool. The goal of the CTC Tool is to simply and effectively improve on communica-tion and coordination of care with primary and specialist physicians. Providing direct commu-nication with specialists offers primary care a resource to help them with effectively managing care. In some cases, patients may be managed without a need for formal referral or by receiv-ing timely specialist care and avoiding an un-necessary trip to the ER. It is interesting that when we are out talking to physicians about this application, it is common to hear of curbside chats that used to occur when physicians gath-ered more and interacted within the walls of hospitals. The CTC provides a structured, easy to use and secure communication. Physicians can use the application from a smart phone, tablet or lap top. We are currently in a pilot phase of development. In Greater Minnesota the effects of health reform is just as significant. From the early formation of the Co-op we have had interest to create a state-wide specialty representation. We have made frequent trips to northern, central and southern Minnesota. A broad geograph-ic representation can support independent

practices across the state and improve com-munity health. The future of the Collaborative Care Co-operative is wide open. Not being tied to bricks or mortar certainly provides for a nimble and adaptable organization. We have very ambitious plans, relying on our collaborative interests to preserve patient choice and to continually tap into the knowledge and innovation of the independent specialist and our primary care colleagues. Staying focused on the Triple Aim of managing cost, quality improvement and the patient experience will continue to be our guide.

Collaborative Care Cooperative Shareholders

Allergy and Asthma Care, pACenter for Diagnostic ImagingColon and rectal Surgery, pAEdina Eye physicians, pAMetro Urology, pAMidwest Ear, Nose & Throat Specialists, pAMinnesota Eye Consultants, pAMinnesota Oncology/Hematology, pANoran Neurological Clinic, pAOakdale Ear, Nose & Throat, pASt. Croix Orthopaedics, pASt. paul Eye, pASt. paul radiology, pASummit Orthopedics, Ltd.Therapy partnersTwin Cities Orthopedics, pAWest Metro Ophthalmology, pA

Vision: Delivering extraordinary patient care through effective physician collaboration across organizational boundaries, allow-ing patients and their primary care team the freedom to select the specialty physicians of their choice.

Mission: The Collaborative Care Cooperative offers a patient-centered alternative to coordinate care, in a cost-effective setting. Our mission will be enhanced through the delivery of an excep-tional patient experience with each care team interaction. We will achieve our mission by deploying innovative electronic tools and collaborative practices which remove communication barri-ers, and through a continuous drive to customize care for each, individual patient.

For more information please contact Douglas Hanson, chief administrative officer (612) 229-4801.

Douglas Hanson, MPA is a senior health care executive with extensive experience in hospital and clinic management, operations, and marketing. Hanson currently serves as chief administrative officer for the Collaborative Care Cooperative, a network with over 500 independent specialists serving Minnesota. Prior to the Co-op, he was President/CEO of Integrated Medical Rehabili-tation of MN, LLC a multi-site rehabilitation company.



Where do Specialists Fit in Accountable Care?

(Continued on page 20)By Thomas p. Flynn, M.D.

In late 2011, the Centers for Medicare and Medicaid Services (CMS) released its final rule for the implementation

of the Medicare Shared Services Program (MSSP) and the Advanced Payment Model under which Accountable Care Organiza-tions (ACOs) would function. The final rule confirms that the agency’s focus will be to achieve cost effectiveness in populations that are large but relatively low cost, and specialties that manage smaller but higher cost patient populations will be involved more peripherally. Patients will be assigned to the ACO based on the primary care physician (PCP) who provides the most primary care services. Although often misunderstood by special-ists, the rule does allow for the assignment of patients who receive no services from a PCP to a specialist who provides the greatest number of primary services. For patients with conditions such as cancer, advanced renal failure or complex cardiac disease, a specialist may provide most if not all of their care in a given time frame such that the patient could be assigned to no ACO, the ACO in which the specialist participates, or the ACO of a PCP who sees the patient infrequently and belongs to an ACO different than that of the specialist. Such ACO assignments could make coordination of care and access to the specialist more difficult and reduce oppor-tunities to realize cost savings. Another feature of the final CMS rule that could impact specialists is the exclu-sion of patients in the 99th percentile of costs from per capita spending targets and

the analysis of how the ACO is performing relative to those targets. For oncologists this will mean that many cancer patients under-going active treatment will be excluded from assignment to an ACO given the expense of modern cancer care. Beyond these components of the final CMS rule, another aspect that may affect specialists is the approach to spending tar-gets. Per capita spending targets will be based initially on three years of historical spending weighted more heavily on the third year. Then in the three performance years there is an upward adjustment using a minimal index of inflation. This represents a major challenge in oncology, for example, given the number of new cancer drugs and technolo-gies being developed and rapidly becoming available for use in patient care. So-called targeted therapies, which are often more ef-fective and less toxic, are very expensive, and it will be difficult, perhaps impossible, to provide state-of-the-art cancer care to Medi-care beneficiaries with cancer at a stable or lower cost over even just a three-year period. Similar challenges are likely in other spe-cialties that deliver care to complex patients who require costly drugs or medical devices. Finally, many patients demand that oncolo-gists provide the latest cancer drugs based on their personal research — often conducted on the internet. It will be key for physicians to delicately manage patient expectations with the reality of these new approaches to health care reimbursement. Under an ACO, the eventual reimbursement scheme would require a “better, faster, cheaper” approach to health care. In other words, our group will need to find better ways to provide care (total cost, P4P, etc.). Generic equivalent cancer

drugs would need to be utilized instead of more expensive (yet equivalent) brand name drugs. This would result in meeting quality and clinical objectives, yet save the patient and the government (Medicare) unnecessary drug expense. The key to the success of the ACO is the ability to deliver multi-lateral, effective and timely information so patient care can be managed in an effective manner. The size of Minnesota Oncology and its partnership with US Oncology should allow our practice to be able to intelligently manage patient care and to control, or at least moderate, increases in health care costs. The key chal-lenge to all of these efforts is to find a way to link (interface) all of the different practice management systems and EHRs among the


Where do Specialists Fit?



various parties (hospitals, physician practices, other care providers) — hopefully, health data interchanges will develop and evolve to man-age these complex data streams. Without these data interchange capabilities, ACOs will not be able to carry out their expected missions. For independent specialty practices particularly, we believe it is important that ACOs are governed and clinically managed by physicians, who have an obvious stake in the physician-patient relationship. If the ACOs are deemed to be skewed in favor of the health systems (or hospitals), this would be potentially corrosive for the long-term stability of ACOs. If however, health sys-tems are willing to truly engage with their employed physicians AND to partner with independent physician practices, this would result in ACOs becoming potentially endur-ing organizations. The commercial health insurance sec-tor is, of course, also interested in greater value and controlling costs. We expect to see a continued trend among commercial payers to develop non-traditional payment methodologies as an approach to control costs. Although cancer patients represent only 1 percent of commercial patients, cancer services represent 10 percent of all health care costs, which would be an attractive focus for cost savings. A shift away from volume-based, fee-for-service payments toward episode of care based, bundled payment, and shared savings models are being actively pursued by a number of payers. At Minnesota On-cology, we employ evidence-based clinical pathways which have been associated with lower costs without compromising outcomes. Patients with lung and colon cancer treated with chemotherapy on these pathways had costs that were over 30 percent less than those treated off-pathway and experienced the same survival outcomes.1,2 Opportunities are being pursued with payers to qualify for reimbursement based on compliance with these pathways as well as fee schedule adjust-ments that provide appropriate incentives for the use of lower cost generic chemotherapy agents. Nationally, United Health Care and

Aetna are piloting oncology-specific episodes of care payment models with large oncology practices. Beyond ACOs and the approaches with payers outlined above, there are other op-portunities for specialists to be accountable for the care they provide. The Congressional Budget Office estimates that up to 30 per-cent of medical care delivered in the United States is for tests, provider visits, procedures, hospital stays and other services that are un-necessary and do not provide a health benefit to patients. In 2010, Howard Brody, M.D. published a piece in the New England Jour-nal of Medicine titled “Medicine’s Ethical Responsibility for Health Care Reform – the Top Five List.”3 Dr. Brody challenged the medical community to address waste and inefficiency in health care delivery by sug-gesting that each specialty identify the top five practices that are widely utilized, costly and yet for which there is no evidence to indicate they add value to the care that is provided. The American Society of Clini-cal Oncology (ASCO), which established a Cost of Cancer Care Task Force in 2007 that developed a policy statement on the high cost of cancer care, encourages oncologists to discuss the cost of care with patients. More recently, in response to Dr. Brody’s chal-lenge, ASCO developed a “Top Five List” for oncology as opportunities to improve care and reduce costs.4 Minnesota Oncology, which has already embraced some of these items, is exploring ways to incorporate these approaches into everyday practice, ultimately utilizing our electronic health record. We would view the employment of such top five lists as a strategy to make care more ac-countable, reduce wasteful expenditures, and thereby lower the cost of care while maintain-ing and arguably improving quality. Comparative outcome studies will be needed to define how we can achieve cost savings while maintaining the highest qual-ity of care and the best outcomes. Large groups such as ours should participate in contributing to this body of evidence. All parties should welcome comparative stud-ies when measuring quality and outcomes. Competition, by nature, drives organizations to constantly improve and innovate — which

should benefit the patients and society at large, while contributing value to an ACO. Specialists may be on the periphery in ACOs as developed by CMS, but they still have opportunities to collaborate with PCPs under that model and contribute to the realization of cost savings, potentially participating in more than one ACO. Beyond involvement in ACOs under CMS, special-ists will be able to partake in nontraditional payment methodologies either independently or as part of ACO responder organizations employing episode of care reimbursement, bundled payment structures, shared savings arrangements or other methodologies as health care transforms from a volume-based, fee-for-service reimbursement system to a model that is value based. To further en-hance value by eliminating waste, specialists are perhaps in the best position to develop and employ approaches such as the “Top Five Lists,” which in our view are worthy of significant attention and further efforts to implement.

Thomas P. Flynn, M.D. has been in private practice since 1987 as a partner in Minne-sota Oncology with a clinical practice based in Minneapolis. He has served as the group’s president from 2001 to the present. Dr. Flynn was awarded a medical degree by the University of Minnesota Medical School. He completed an internship and residency in internal medicine at Washington University/Barnes Hospital in St Louis, and a fellowship in hematology/on-cology at the University of Minnesota. Prior to joining Minnesota Oncology, he was on staff in the Hematology-Oncology section at St. Paul Ramsey Medical Center and a member of the University of Minnesota Medical School faculty.

References:1. Neubauer, MA, et. al. Cost Effectiveness of Evidence-

Based Treatment Guidelines for the Treatment of Non-Small-Cell Lung Cancer in the Community Setting. JOP 2010; 6:12-18.

2. Hoverman, JR, et.al. Pathways, Outcomes and Costs in Colon Cancer: Retrospective Evaluation in Two Distinct Data Bases. JOP 2011; 7:52s-58s.

3. Brody, H. Medicine’s Ethical Responsibility for Health Care Reform – The Top Five List. N Engl J Med 2010; 362:283-285.

4. Schnipper LE, et.al. American Society of Clinical Oncology Identifies Five Key Opportunities to Improve Care and Reduce Costs: The Top Five List for Oncology. JCO published online April 3, 2012; DOI:10.1200/JCO.2012.42.8375.


The ACO Paradox

By Scott r. Ketover, M.D. AGAF (Continued on page 22)

The passage of the federal Accountable Care Act in the spring of 2010 pro-vided the legislative framework for

many changes to occur in health care financ-ing. While the initial discussion and debate around federal health-care legislation focused on improving access for the underinsured, improving quality for patients, and helping to control health care costs, the major impact of the federal legislation will be focused upon cost control. Most physicians are now familiar with the term Accountable Care Organization (ACO). The federal legislation resulted in the Center for Medicare and Medicaid Services (CMS) establishing a Medicare Shared Savings Program. This program is designed to incentiv-ize health care providers to help control health care costs and, as a result of doing so, to share in the financial benefits. CMS has used the acronym ACO to name the outcome of these efforts. This has led to some confusion in the use of the term ACO in the marketplace.

Does ACO Mean ACO? We need to think of ACOs from two perspec-tives. The first is as a noun and the second is as an adjective. When discussing the Federal or CMS ACOs we need to think of the term as a noun or as a destination. The U.S. government finalized the rules in November 2011 in the Federal Register, which define exactly what is an ACO. These rules narrowly establish which providers and health care organizations, and under what circumstances, can perform as an ACO for Medicare beneficiaries. On the other hand, the use of the term ACO for programs being developed outside

of Medicare refers to more of a process or a journey. This implies that the non-CMS ACO actually refers to a clinically integrated network of providers and/or systems and can be de-fined in many different ways across non-CMS patients. Most importantly both structures, the CMS and non-CMS ACO, are designed to meet the goals of the “Triple Aim”: 1. Reduce per capita cost of care 2. Improve the patient experience and quality

of care 3. Improve population health And to further add to the confusion, CMS has recently defined a category of Pio-neer ACOs. These are designed to follow the same cost control format of the other shared savings programs, and if they are successful in their first two years they can then change in year three to move to a population-based payment arrangement with full risk and capitation.

Common Features in all ACOs All of the ACO programs are designed such that health care providers assume the financial

responsibility and risk for meeting the goals of the Triple Aim. In the CMS ACOs the patients retain full freedom of choice. That is, Medicare beneficiaries may continue to choose the pro-viders and the institutions where they receive their care, without regard to a particular ACO. The non-CMS ACOs will individually determine whether or not patients are restricted to a narrowly defined network of providers and institutions or have open access and wide choice. As each accountable care organization determines its structure this will in turn have a major impact upon the ability of the ACO to help meet the Triple Aim and determine the overall cost of the product to the patients, employers and other subscribers. Providers will have significant incentives to help control appropriate utilization of health care services and to help minimize the use of services that are of unproven benefit. As phy-sicians, we greatly impact utilization via the orders that we create for office visits, hospital-izations, testing, procedures, labs, radiology, prescriptions, and therapies. However, demand for health care services is often initiated by a patient’s need or desire. Thus, many patients enter the system of care and consume services before providers can help to control utilization.

Triple Aim vs. Single Aim There is almost no debate among health care providers that the Triple Aim is a worthy tar-get. However, what we have seen so far in the development of CMS ACOs is emphasis on the shared savings program. The economic realities around the enor-mous cost of delivery of care throughout the nation are driving the changes in both form and function of health care organizations. The


The ACO Paradox



incentives to reduce the per capita cost of care will dwarf those designed to enhance quality of care and improve population health. In the past two years, these economic incentives have resulted in a rapid increase in consolidation of health care providers. Mergers and acquisitions among hospitals, hospitals and medical providers, and provider groups are happening at an ever-increasing rate. This consolidation is often being called clinical in-tegration, and it is hoped that these changes result in less expensive delivery of care.

Clinical Integration It is believed that by combining the strengths of the various provider groups and organiza-tions along clinical service lines that major cost controls can be achieved. Implementation of guidelines and pathways will help to decrease unnecessary utilization. The combined applica-tion of the intellectual capital of many providers will hopefully lead to improved health care delivery at a lower cost. However, the process of successful clinical integration is very expensive. This will demand very robust information technology platforms. This IT infrastructure has yet to be developed. Most medical clinics and hospitals are still trying to purchase and implement elec-tronic health records. There are numerous EHRs available in the marketplace and the conversion from a paper-based medical record to that of an electronic one is quite cumber-some, time-consuming and costly. The clinical interoperability of the various EHRs is in its infancy. Regional, state and national health information exchanges do not yet exist for the overwhelming majority of the U.S. population. So the adoption and implementation of EHRs is certainly necessary but clearly insufficient for promoting the process of widespread clinical integration.

The ACO Paradox Will ACOs provide the correct incentives to achieve the Triple Aim? While most experts agree that clinical integration is essential to meet the goals of an improved system, it remains unclear as to how to execute the integration. There are many

single specialty provider groups, which have developed the focused factories necessary to minimize inappropriate utilization of health care resources. The methodology to bring these independent provider groups together to achieve an even larger goal is unknown. There will be quite a lot of trial and error in shaping these new relationships. Independent medical provider groups have previously viewed both hospital organizations and third-party payers as competitors. And in many circumstances these relationships were somewhat adversarial. Future success depends upon restructuring these relationships. Current market realities are helping to move this process along. In general, third-party reimbursement to independent specialty practice is less than that of the reimbursement received by multispecialty practice and health systems. This fact promotes the movement of single specialty providers into larger organiza-tions. It remains to be seen if the utilization, overhead and cost control advantage of the focused factory is lost when the single specialty provider becomes part of a large clinically in-tegrated multispecialty network/ACO.

How has Minnesota Gastroenterology Engaged this Environment? Minnesota Gastroenterology, PA is a large single specialty independent practice. We are composed of 60 gastroenterology physicians and 20 mid-level providers. Our organization has continually assessed how we deliver GI care with the goal of providing the best possible clinical outcomes at the lowest possible cost. This requires an internal organizational dedication to creating a governance and opera-tional structure focused upon patient care. This is always a “work in progress.” In addition to a strong internal emphasis there is also external engagement from the practice members to our larger GI community. We accomplish this by: • Activeparticipationand leadership in

regional and national gastroenterology organizations. This includes: the Ameri-can Gastroenterological Association, the American Society for Gastrointestinal Endoscopy, the American Association for the Study of Liver Diseases, the Twin Cities Medical Society, the Institute for

Clinical Systems Improvement, the na-tional GI Practice Management Group, the Get Your Rear in Gear colon cancer awareness events, and the MN Labor Care Health Fair.

• Engagementwithother localprovidergroups via hospital system organizations. This includes participation in local hos-pital medical staff committees and posi-tions on the boards of several of the health systems.

Recommendations for Independent Groups 1. Every Independent practice should create

its seat at the table. Independent providers need to assess their geography and iden-tify their current allies and competitors. Practices need to seriously consider which of their current competitors can actually be turned into allies.

2. Physicians, and other health care provid-ers, hospitals and health systems must continue to seek out each other to define the advantages of clinical integration. In-dependent practices cannot afford to wait on the sidelines.

3. Implement an electronic health record. For many years I have said, “if there was ever an industry ripe for digitalization, it is health care. There are billions of pieces of patient information, which are only valuable to the health care provider at the moment of care delivery.” The federal Meaningful Use dollars will help defray the cost, and it is inevitable that all of health care will be documented in an electronic format in the not-too-distant future.

4. ACOs must be designed to give the in-dividual patients their personal responsi-bility for their own health. Today, CMS defined ACOs allow Medicare beneficia-ries to sidestep this responsibility. I believe this will greatly limit the success of the CMS model. Non-CMS ACOs have the opportunity to engage the recipient of care in achieving the Triple Aim.

Editor’s Note:Following the submission of this article, the editorial board requested further comments from Dr. Ketover. His responses are below:


The impetus for ACOs is cost contain-ment as you state, and this poses dilemmas for physician organizations.

• How would you envision patients being active and effective in directing cost controls? Patients will not have the tools to be active and effective in directing cost controls until full transparency of cost is supported: this means all providers, payers, hospitals, facilities, etc. need to be free to “publish” and discuss the con-tracted rates/payments they receive for services (currently a Stark and payer contract violation).

• How would patients (or would they) be able to direct to whom the money goes for their care?Very soon many patients will participate in private insurance exchanges (starting 1/1/13 for some) as their employers convert to defined contribution benefit plans. Patients/employees will choose their “plan” based upon their per-sonal monthly cash contribution. This will be done via the web during open enrollment each fall. Choice will be guided by cost in the same way as most people purchase auto insurance (as a commodity). Plan design will create a “race

to the bottom” as plan cost will dominate and issues around quality and outcomes will receive more “lip service.”

• If care coordination is key to cost reductions in an ACO, what will this entail practically — i.e. who will do it? Care coordination as currently envisioned by CMS and private payers is a “gatekeeper” con-cept and will only serve to add administrative cost to care, and may actually cause total cost of care to increase. Real ACO care coordination will require robust IT platforms (not available today) with full transparency of costs and the health care community, politicians and insurers will not support this.

• What role will medical specialists vs. primary care gatekeepers have in evaluating a given patient’s need for their services?Specialists and primary care doctors will not provide the gatekeeper role unless their com-pensation is directly tied to benchmarks and this would create a moral dilemma around denial of care.

• Can a group like yours participate in more than one ACO?For CMS: primary care can only participate in one ACO. For non-CMS both primary care and specialty care can participate in multiple ACOs as permitted by each non-CMS ACO design.

Scott Ketover, M.D., president and CEO of Minnesota Gastroenterology, P.A. Dr. Ketover is a native of New York City. He earned his un-dergraduate degree in Communication Studies from Northwestern University, attended business school at New York University and completed his premedical training at Columbia University. Dr. Ketover received his medical degree from the University of Minnesota. He completed his resi-dency in internal medicine and his Fellowship in gastroenterology at the University of Minnesota Hospital and Clinics. He has been a member of Minnesota Gastroenterology’s Board of Directors since 1998 and has served as the chairman of the Board since 2007.


Quiet SessionA Welcome Change

By Nathan Mussell, J.D.

Looking back, it was a relatively quiet session from a health care perspec-tive. A budget surplus paired with

the political realities of redistricting and the upcoming election resulted in only a handful of significant health care policy bills being passed in the 2012 session. Although the session did not start until the end of January, the table was largely set following the release of the November budget forecast in early December. Much to the surprise of everyone involved, the forecast showed an $876 mil-lion surplus, a number many had expected to be around a $500 million deficit. Once the session began much of the legislative work did not start until after the revised February forecast came out the last day of the month. Again, the February forecast showed an ad-ditional $323 million surplus. Statutorily most of the surplus dollars were already spent the moment they were re-alized leaving little leftover to repair some of the difficult health care cuts from 2011. The first part of the surplus was used to backfill the budget reserve account and the state’s cash flow account. The remaining dollars from the surplus went to begin repayment on the school aid payment shift used as a budget balancing mechanism the last couple legisla-tive sessions. The surplus is not expected to extend beyond this session as the next bien-nium is currently projected to have a deficit of $1.1 billion. However, as was evidenced last year, this number could shift based on changing economic conditions.

HHS Omnibus Budget BillUnlike in years past, the HHS omnibus budget bill proved to be relatively non-con-troversial and moved through the process with relative ease this session. In large part due to the surplus, the total bill was only around $23 million — much of which came from monies being repaid to the state by the HMOs participating in the Prepaid Medical Assistance Program. Dating back to last year, the state man-dated that any profits above 1 percent by the HMOs in PMAP (Prepaid Medical As-sistance Program) had to be paid back to the state. The final numbers released in early April amounted to a total payback of $73 million, $31 million from Medica, $25 mil-lion from HealthPartners, $9 million from Blue Cross, and $8 million from UCare. After returning just over half the funds to the federal government, and allocating a portion back to the Health Care Access Fund, the legislature was left with around $27 million. After much frustration in the negotiating

process, only around $11 million of those funds were allocated toward the HHS bud-get, leaving the additional funds to be used toward a tax relief package, which in the end was vetoed twice. With the addition of the $11 million, Rep. Abeler and Sen. Hann were able to restore a few of the cuts made in the 2011 budget that had been priorities of the Gov-ernor’s supplemental budget including $5.9 million for a delay in the cut for personal care attendants who were relatives of the patient, $4.6 million for restoration of cancer and dialysis treatment coverage in Emergency Medical Assistance. The House and Senate did not include any funding restoration for the Medical Education and Research Costs program which had also been a priority in the Governor’s budget. In addition to the above budget items, a few policy items were included, most of which proved noncontroversial or had been worked out during the conference committee including language around PMAP transpar-ency to conduct audits in conjunction with the legislative auditor, a study of the effective-ness of managed care in public programs, a study of for-profit HMOs in Minnesota, a study of the Emergency Medical Assistance Program, and a study of access to patient health care records. One item of significance that was not included in the final bill included a full re-peal of Rule 101. Currently Rule 101, as it is known, requires that a provider accept public program patients in order to also be able to accept state employee, workers com-pensation and other public employees. The Senate had added an amendment during the


floor discussion before conference commit-tee that would have repealed the Rule 101 requirements in statute. Ultimately, DHS had significant opposition to the repeal so it was taken out of the bill that came out of conference committee.

Managed Care TransparencyOutside of the budget discussions the other issue that drew considerable discussion this session was transparency in the state’s man-aged care programs. The issue of transpar-ency in the state’s PMAP program has been gaining greater notoriety on both sides of the aisle over the past couple legislative sessions. This session the issue came forward in a bill calling for independent third party audits of the health plans and the rate setting in PMAP done by the Department of Human Services. As it has been reported, the federal govern-ment appears to be investigating whether the state intentionally inflated the rates in Medical Assistance (which receives federal matching funds) in order to make up for losses being sustained in GAMC. The issue has gained increased attention in Washington D.C. in Congressional hearings as well. This will likely be an issue to continue watching over the coming months, both to see if any adverse action is taken against the state and DHS and whether any reforms are made at the federal level that may impact the state budget going forward.

Board of Medical Practice and the Sunset Commission One of the most contentious issues that arose in this session that didn’t deal with budget or transparency dealt with a bill coming out of the Sunset Commission requiring cer-tain information regarding any provider’s malpractice settlements, judgments, adverse privileging actions and felony conviction be posted on a public Board of Medical Practice website for notification for consumers. The issue of posting malpractice settle-ments drew considerable opposition from providers, clinics and malpractice insurers. Ultimately after being in the bill, then out of the bill, then back in, settlements were taken out leaving only the posting of judgments in the final bill signed into law.

Provider Peer GroupingThe Provider Peer Grouping program was a major piece of the Health Care Reform bill passed by the legislature in 2008. Over the past two years there has been concerns raised with the effectiveness and accuracy of the reporting data in the program as it was intended. Earlier last fall, hospitals around the state were the first set of providers to have their peer grouping data released. The release of the data to hospitals brought the concerns of the past two years to light as there were considerable questions about the data’s accuracy and the ability of hospitals to review the data. Legislation was passed this session making a number of changes to the program through creation of an advisory committee, extending the timeline on review of the data, and how the data would be dis-seminated to the public. The changes in the bill had been worked on by members of the provider community, the health plans and the Department of Health.

Health Insurance Exchange and the ACAOutside of some initial discussions in the House and Senate HHS committees on the activities of the Governor’s Health Insurance Exchange Task Force, the only legislative activity on the exchange came when Sen. Hann gave the insurance exchange bill a hearing in his committee late on a Monday evening only to vote the bill down along party lines. Beyond that brief show the is-sue largely remained on the sidelines with eyes on the Supreme Court oral arguments on the constitutionality of the overarching Accountable Care Act. Now that the session is finished, the activity in both the Exchange and larger Health Reform Task Forces will likely begin again in earnest as the groups put together a potentially significant piece of legislation for the 2013 legislative session.

Nathan Mussell, J.D., Government Affairs, Lockridge Grindal Nauen.


The Legacy of Dr. Eduard Boeckmann, East Metro Medical Pioneer

A Country Doctor Practicing in the CityIn 1887, Dr. Eduard Boeckmann (1849-1927), then a 38-year-old Norwegian im-migrant, arrived in Saint Paul, Minnesota with his wife Anna and their four children. Boeckmann would live in the Twin Cities area for the rest of his life and would become a well-known physician and active member and future president of the Ramsey County Medical Society, now the Twin Cities Medical Society. As a doctor, Boeckmann was atten-tive to his patients and well respected by his colleagues. Dr. William J. Mayo once said that it was to those such as Dr. Boeckmann “that the profession owes a great debt.” An active researcher, practitioner, and philan-thropist, Boeckmann’s presence in the Twin Cities continues to influence medical practice in Minnesota in an age far removed from his own. Dr. Boeckmann was a concerned ad-vocate for the well-being of his patients and dedicated himself to providing them with personal, dutiful care; he often referred to himself as a country doctor who practiced in the city. He spent many late nights at the of-fice, working until he had seen every patient, as was his personal policy. Dr. Boeckmann was also generous with his time and exper-tise and mentored several of his younger, less experienced colleagues. He graciously offered his professional advice and counsel free of charge. To his friends and colleagues, Boeckmann was known for his honesty, sin-cerity and kindness.

Creation of the Medical LibraryIn today’s technology-saturated world, it is easy to take accessible information for granted, but for doctors in the 1890s, find-ing medical information at all, let alone relevant information, could be laborious. Even before Boeckmann’s arrival in Min-nesota, the Ramsey County Medical Society had recognized the need to provide access to medical information and research to member physicians, but it took the initiative of Boeck-mann and a few of his colleagues to make the possibility of a medical library a reality. Boeckmann understood the importance of the library’s establishment for Twin Cities physicians and their patients, and he gave sacrificially of his time and resources to see that many would benefit from the use of a medical library. For Boeckmann, this meant donating many of his own books to the col-lection and making door-to-door buggy rides to ask for book donations from other doctors.

Due to the efforts of Boeckmann and others, the Ramsey County Medical Library was established in 1897; however, this was only the first step. Once the collection was started, the Medical Society required ongoing funding to run and house the library.

Dr. Boeckmann the Enterprising PhilanthropistAlthough Boeckmann was not personally responsible for the operation of the medical library, his sense of duty and devotion to the medical profession compelled him to ensure the library’s survival. In one effort to sup-port the upkeep of the library, Boeckmann co-founded the Saint Paul Medical Journal. The Journal provided the library an income through advertising, but it was not substan-tial enough to support it completely. Yet, Boeckmann’s greatest contribution to the medical library, the Twin Cities medical community, and medical practice across the country was his medical breakthrough: the development of a process for making sterile pyoktanin surgical catgut. Then the primary material for surgical sutures, catgut, made from the gut of sheep, was not always sterile when doctors received it, and it frequently caused infection. Prior to Boeckmann’s re-search, the only producers of surgical catgut were located in Germany. Dr. Boeckmann, with the help of bacteriologist Dr. Gustav Renz, sought to create a method to prepare an improved catgut suture. In 1899, the year he was president of Ramsey County Medical Society, Boeckmann, aided by the input of his colleagues, finished his development of surgical catgut treated with pyoktanin. This antibacterial dye made sutures sterile, anti-septic, and decidedly preferable to horsehair By Kristin roberts


or silver wire — the only other alternatives of the time. Shortly after perfecting his catgut prepa-ration process, in a far-reaching act of philan-thropy, Boeckmann donated its manufacture and proceeds to the Ramsey County Medical Society to cover the expenses of the library. Boeckmann’s catgut was manufactured until 1959 when the process was sold, and the remaining money was used to sustain library operation through what is now called the Boeckmann Fund. Boeckmann’s work to support the library and his fellow physicians is still seen as an important part in the devel-opment of Minnesota’s medical community. Dr. Frank Indihar, EMMS Foundation Board member, reflects, “Dr. Boeckmann’s signifi-cant contribution to the Ramsey County Medical Society (now TCMS) insured the education of his colleagues for generations.” In honor of Dr. Boeckmann’s efforts and commitment to education, the library was renamed The Boeckmann Library in 1971; today, the library is no longer run by the

medical society, but the collection, now lo-cated in United Hospital, is available for the use of Twin Cities physicians and medical researchers.

Dr. Boeckmann’s LegacyBoeckmann’s generosity and the genuine pas-sion for medical practice that drove it was rare then and is still an inspiring story today. Even after more than 100 years, Boeckmann is remembered for his charitable contributions to medicine and unimpeachable character in practice. “Dr. Boeckmann exemplified the best physician traits: medical research curiosity, clinical excellence, and generosity,” says Dr. Kent Wilson, EMMS Foundation president. “The generous gift of his sterile absorbable suture proceeds to the medical so-ciety supported the society and its library for decades and now is a major funding source for the EMMS Foundation. The Foundation provides support and leadership in address-ing health issues given its unique position in the medical community. Recently, Dr.

Boeckmann’s legacy gift catalyzed the Hon-oring Choices Minnesota initiative. We may not all be able to donate a business enterprise, but we all can add to Dr. Boeckmann’s initial gift for the benefit of east metro physicians and community.” Recognizing the philanthropic spirit of Dr. Boeckmann, the East Metro Medi-cal Society Foundation plans to continue to sustain the Boeckmann fund in service to the physicians in the east metro. In honor of Dr. Boeckmann, the East Metro Medical Society Foundation will yearly recognize a recipient of the Boeckmann Community Service and Leadership Award. The Boeckmann Award will be given to an east metro physician and unsung hero who, like Dr. Boeckmann, gives sacrificially of him or herself for the good of the community. Dr. Boeckmann’s legacy recognizes outstanding physicians, continues to support the community and serve as an example for future citizen physicians.

Boeckmann Community Service & Leadership Award2008 George F. Smith, Jr., MD

2007 Walter L. Bailey, MD

2006 Richard W. Anderson, MD

2005 Vernon L. Sommerdorf, MD

2004 Rene W. Pelletier, MD

2003 Mary Lou Ezzo, MD

2002 Deborah L. Wexler, MD

2001 Joseph H. Tashjian, MD

2000 Wayne H. Thalbuber, MD

1999 Neal R. Holtan, MD

1998 Frederick M. Owens, Jr., MD

1997 Stephen P. England, MD

1996 Budd Appleton, MD

1995 No Award Given

1994 Timothy J. Rumsey, MD

1993 Charles E. Crutchfield, Sr., MD1992 Laura Edwards, MD

Previous Award Recipients

The annual Community Service Award recognizes “unsung physician heroes” who have made positive contributions to our local community. When the East and West Metro Medical Societies merged to create the Twin Cities Medical Society, the management of the Community Service Award reverted to the East Metro Medical Society Foundation. In 2011, the Foundation Board of Directors renamed the award to The EMMS Foundation Boeckmann Community Service and Leadership Award.

Eduard Boeckmann, MD (1849-1927) was an enterprising physician who developed a preparation process for sterile sutures and later donated his business and proceeds to the Ramsey County Medical Society. Dr. Boeckmann’s legacy gift is still a funding source and he is remembered for his passion and generosity for the good of medicine in the east metro area.

CriteriaMust be an active or retired physician from the East Metro. Service must be voluntary in nature and should include one or more of the following elements:

• leadership and development of special community projects or programs;

• participation in civic or service organizations/groups;

• participation in educational, charitable, church, or other projects; or

• publicofficesheld

Nominate a ColleagueSend a description of the physician you are nominating, including specific community activities above and

beyond his/her professional medical work.

Send your nominations to:Katie Snow

[email protected]: 612.362.3704Fx: 612.623.2888

Nominations due by July 31, 2012


Senior Physicians Association News

The spring meeting of the Senior Physi-cians Association was held on Tuesday, May 1, 2012 with Claus Pierach, M.D., professor, University of Minnesota, pro-viding an entertaining presentation on his collection of signed art prints, “Cover Art on JAMA and Other Journals,” complete with personal knowledge of many of the artists. Please mark your calendar and plan to join your colleagues at these upcoming luncheons and the Annual Event:• July10,2012—AaronFriedman,

M.D., “Vision for the Medical School”

• October9,2012—DougJensen,“Great Lakes and Threats to Min-nesota Waters”

• AnnualEvent—Tuesday,Septem-ber 4, 2012 — Weismann Art Mu-seum — Tour and Luncheon. Guests are welcome!

Watch your email for announcements and meeting notices. Please contact Andrea Farina for more information: [email protected]; (612) 623-2885.

As a follow-up to the TCMS and Minnesota Psychiatric Society co-sponsored Forum on Mental Health: Improving Access and Qual-ity, held last December, a task force of mental health and primary care providers, including other stakeholders, has been convened and met on two occasions. The following goals have been established:• Improveaccesstomentalhealth/behav-

ioral health services encompassing all age groups through collaborative, integrated services;

• Provide educational opportunities toprimary care physicians and staff to in-crease ability to serve patients with mental health/behavioral health issues;

Mental Health and Primary Care Task Force Meets

• Increaseopportunitiesforactivecollabora-tion between primary care and behavioral health clinicians through expanded part-nerships; and

• Developcaredeliverymodel(s)thatarefinancially viable.Strategies include supporting the Fast

Tracker Program (Minnesota Psych Society), exploring telemedicine opportunities for edu-cation and consultation, and payment system reform.

If you are interested in participating in the task force and/or learning more about its work, please contact Nancy Bauer at [email protected]; (612) 623-2893.

Richard Anderson, M.D., SPA president, with guest speaker Claus Pierach, M.D.

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Spotlight on Honoring Choices Physician “Stars”

Sharing the Experience: Honoring Choices Minnesota Conference

Date: Thursday, July 19, 2012 Time: 9:00 a.m.—5:00 p.m. Location: Ramada Plaza, 1330 Industrial Blvd. NE, Minneapolis 55413Cost: $75

Attendees will:◆ Share the progress and findings of local advance care

planning programs ◆ Identify best practices for advance care planning through

reports from clinics, hospitals, community and other sites ◆ Discover new perspectives from guest speakers, faith

communities and multi-cultural leaders ◆ Network with others who are skilled in implementing

advance care planning conversations in Minnesota

Registration deadline: July 10 Questions? Contact Katie Snow, Coordinator, at (612) 362-3704 or [email protected]

J. Milo Meland, M.D. is co-chair of the Hon-oring Choices Ambassador training group. Dr. Meland and Ross Anderson, M.D. work closely together with Barbara Greene, MPH, director of Community Engagement, to ensure that community Ambassadors are well-equipped to lead community-wide advance care plan-ning sessions.

Ross Anderson, M.D. is co-chair of the Honor-ing Choices Ambassador training group. Dr. Anderson joins J. Milo Meland, M.D. in con-vening the 24-person Ambassador group. Dr. Anderson led an Advance Care Planning (ACP) presentation with medical assistants at the Min-nesota Medical Assistants state conference.

Kent Wilson, M.D. spoke at the 3rd Interna-tional Society of Advance Care Planning and End-of-Life Care Conference in Chicago on

June 2. Dr. Wilson has also given advance care planning presentations at the Min-nesota Network of Hospice & Palliative Care annual conference; to congrega-tion members of House of Hope Presbyterian Church, Saint Paul; and to representa-tives of United Theological Seminary.

C. Dwight Townes, M.D. is an Ambassador who has led ACP sessions at Park Ridge facility in Hastings and to members of his local Rotary Club.

Gary Hanovich, M.D. is an Ambassador who introduced ACP to residents at Elim Shores in Eden Prairie.

Kenneth Kephart, M.D. conducted an ACP one-hour webinar for long-term care pro-viders hosted by Care Providers of Minne-sota, a Minnesota long-term care membership organization.

Stefan Pomrenke, M.D. is an Ambassador who conducted brown-bag lunch-n-learn sessions at the United Theological Seminary as well as ACP concurrent session at Bethel University’s Nursing Research and Practice Symposium “Ending Life Well.” Dr. Pomrenke will take an active role in Bethel University’s upcoming October 12 Conference on ACP and EOL care.

Kusum Saxena, M.D. organized and led an ACP workshop at the Hindu Mandir (Temple) of Minnesota. Dr. Saxena is also hosting an ACP session at Applewood Pointe at Lengthen Lake in Roseville later this summer.

Drs. Stefan Pomrenke and Kent Wilson discuss strategies for encouraging Ambassadors to engage with the community.

Craig Bowron, M.D. conducted an ACP Am-bassador Continuing Education session that included sharing his personal experiences with patients at Abbott Northwestern hospital. Dr. Bowron will serve as a keynote presenter at this summer’s “Sharing the Experience” communi-ty-wide advance care planning conference on July 19 at the Ramada Plaza, Minneapolis.


C a r e e r o P P o r t u n I t I e s see additional Career opportunities on page 31.

In MemoriamHARRY S. FRIEDMAN, M.D. passed away on April 5, 2012 at the age of 96. Dr. Friedman attended the University of Min-nesota Medical School and completed his residency in ophthalmology in 1948. He started a practice in Minneapolis, and served in many leadership roles including president of the medical staff at Mount Sinai Hospital, where he was one of the founders. Dr. Fried-man became a member in 1994.

ELIZABETH O. JOHNSON, M.D. passed away at the age of 56 on March 18, 2012. Dr. Johnson attended the University of Min-nesota Medical School, and completed a pe-diatric residency at the Children’s Hospital of Philadelphia and the University of Minne-sota. Dr. Johnson became a member in 1989.

ARTHUR K. LARSON, M.D., age 87, passed away on April 7, 2012. Dr. Larson practiced pediatrics and was a founding phy-sician of the Oxboro Clinic in Bloomington. Dr. Larson became a member in 1957.

PALMER PETERSON, M.D., age 95, passed away on May 6, 2012. Dr. Peterson attended the University of Marquette Medi-cal School in Milwaukee, WI and completed his surgical fellowship at the University of Minnesota in 1952. Dr. Peterson practiced for 50 years receiving the 50 Year Medical Practice Award given by the Minnesota Medi-cal Association.

HERB POLESKY, M.D., passed away on December 19, 2011 at the age of 78. Dr. Polesky attended Stanford University and completed a fellowship in pathology and laboratory medicine at Yale University. He spent 35 years as director of what is now known as the Memorial Blood Centers of Minnesota. Dr. Polesky was also a professor of laboratory medicine at the University of Minnesota. Dr. Polesky became a member in 1965.

HARLEY RACER, M.D., age 87, passed away March 20, 2012. Dr. Racer attended the University of Minnesota Medical School. He was a leader in developing a Family Practice Residency program at Methodist Hospital in St. Louis Park, and he taught and practiced

family medicine at HCMC for 25 years. Dr. Racer became a member in 1952.

CORRECTION:Our sincere apologies to the family of Joseph M. Tambornino, M.D. for misspelling his name in the May/June In Memoriam.

Yup.

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Internal and Family Medicine Physician Opportunities:Stillwater Medical Group has exciting new Internal and Family Medicine Physician opportunities at our NEW Mahtomedi, MN clinic opening Fall 2012! Additional opportunities also available in Stillwater, MN.

Mahtomedi, MN? (Ma-toe-me-dye)So what if you can’t pronounce it? We can help with that. Mahtomedi is located in Washington County, on the east shore of White Bear Lake. Residents appreciate the community’s small town charm, lakeside flavor, and close proximity to the Twin Cities Metropolitan Area. In addition, the Mahtomedi School District and other area colleges offer excellence in education.

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C a r e e r o P P o r t u n I t I e s Please also visit www.metrodoctors.com

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and new career opportunities!

Visit TCMS at www.metrodoctors.com

see additional Career opportunities on page 31.


B y M a r v i n S . S e g a l , M . D .

luMInary

MITCHell j. eINzIg, M.D.

of Twin Cities Medicine

This last page series is intended to honor esteemed colleagues who have contributed significantly to Twin Cities medicine. Please forward names of physicians you would like consid-ered for this recognition to Nancy Bauer, managing editor, [email protected].

Little did the bright young lad growing up in McKees-port, PA realize that he would one day become an iconic beloved teacher of medicine in a clinical academic com-munity half way across the country. Well… that is exactly what happened with our newest Luminary, Dr. Mitchell Einzig. Mitch’s circuitous route to the Twin Cities began near his Pennsylvania roots, obtaining a B.A. at Wash-ington and Jefferson College and moved westward to the University of Chicago Medical School where he graduat-ed in 1964. His internship, residency and military service were accomplished at UCLA, Chicago’s Michael Reese Hospital and the Navy in San Diego. After a short period of private practice in Los Angeles, he settled in Minne-sota where he was co-founder of the Wayzata Children’s Clinic — practicing there for 10 years. His long association with Minneapolis Children’s began as a medical staff member during those private practice days. As pleasant and gratifying as pediatric prac-tice was, he realized that his true calling was teaching in a hospital setting. There were many disappointed patients and parents when Mitch began his long tenure at what was to become The Children’s Hospital and Clinics of Minnesota. First as Director of Ambulatory Care and later becoming Director of Medical Education, Vice President for Medical Affairs, the Director of Graduate Medical Education and since his formal retirement in 2003, the co-Medical Director of Outreach, he’s played a major role in transforming his hospital into the premier educational institution that it is today. As a complementary partner with the U of M, the Children’s/Einzig site became a highly sought after rotation for third and fourth year students and residents alike. Dr. Einzig’s teaching venues varied from Grand Rounds to regular lunchtime conferences and especially to his favorite — bedside rounds. In the discussions during those rounds, he utilized the iterative hypothesis testing strategy for diagnostic decision making where he deftly challenged his students to think in a low stress co-operative learning environment. He emphasized clinical

information gathering by listening, viewing and palpating — prior to the rational utilization of appropriate laboratory and imaging studies. He en-gaged the best and the brightest of his specialty and subspecialty colleagues in our community to aid with lectures and less formal presentations in his quest to create the ideal learning envi-ronment. Those expert physicians were always pleased and honored to have participated in Mitch’s curriculum. The appreciation of his diligent efforts by his legions of students was demonstrated by as impressive an array of teaching awards as one could imagine — beginning with the An-nual Intern Teaching Award at the San Diego Naval Hos-pital and repeatedly continuing for decades as the Faculty Teacher of the Year, with the Distinguished Teacher Award and as a Master Teacher. Less formal acknowledge-ments are evidenced by words of the pupils themselves: “dedicated, enthusiastic, knowledgeable, modest, ultimate role model and … awesome.” Dr. Mitch, Clinical Professor of Pediatrics and Fam-ily Practice, has other interests and talented accomplish-ments: basketball star of yesteryear, golfer, State handball champion, long distance biker, prodigious reader — and perhaps best of all … a caring family man to his two children and Corky, his wife of 40+ years. It was once stated (Henry Brooks Adams, 19th cen-tury), “A teacher affects eternity; he can never tell where his influence stops.” That certainly is the case with our Dr. Einzig…as his legacy continues.

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