May 02, 2017

The tipping point of a healthcare network in a selected geographic area is reached when the growth of the network begins to happen on its own, when the resistance to the development begins to melt away, and providers in the area realize that they have significant advantage in joining the network.

While economies of scale may play a role in reaching the tipping point, the more important aspect is economies of scope, and a sense of mutually beneficial relationships among the community of vendors and providers. In a sense, at this point a strongly integrated network becomes inevitable in the mind of the community with an understanding that such a development brings a shift in the way healthcare will be practiced and that it brings tremendous advantage.

The most important aspect of such network development, to my mind, is its emphasis on relationships, a long-term investment from all parties and a building up of trust. Service and value-creation are the keys based on integrity and credibility. Initially there may be significant resistance, even verbal and emotional violence, warnings of grave injury to providers and patients. But as the network is built brick by brick, rather than person to person, such resistance melts away into sheer ineluctability.

What are the components of building a healthcare network? The key is to develop an anchor practice or multiple anchor practices, preferably in primary care, which makes one become a part of the community. This is the most difficult step and requires the hardest work against greatest resistance. The second step is non-confrontational relationship-building with patients, vendors, facilities, administrators and the provider community. Once the anchor practice takes hold, it should be expanded or enlarged by bringing in more providers or creating more offices in a hub and spoke model.

The emphasis of the practice should be on customer satisfaction, quality, compliance and evidence-based medicine. The stronger the engagement with patients, the easier it is to develop the network. One often finds that a physician community is seldom completely united. There are factions, old grudges and sense of dissatisfaction with the status quo among the non-groupies. It is extremely important to know the lay of the land, areas of population concentration and the dynamics of various factions among the physicians. Invariably, these will want to develop relationships and might wish to outdo one another when the tide turns.

It is important to be non-threatening but focused on one's mission. Having a higher cause is a great help. Financial and operational benefits that might accrue to other providers when they join the band wagon should be reviewed compliantly with a sense of service and humility. There are times when one may need to take a stand but even that must be made professionally, with gentle firmness.

It may be important to offer several lines of service, to touch the provider at multiple levels and in multiple ways. A team based approach and relationship-building helps since each provider is different in aptitude, background, preference and needs. A team comprised of a physician liaison, compliance and quality officers, managed care or accountable care solutions and resources, IT services, data and analytics, and legal and financial counsellors may be used to reach out to providers in a holistic manner as needed.

Besides building a primary care network, one should strongly consider a specialty network, a network of hospitalists, SNFists, physicians making home visits, urgent care offices and various outpatient services such as radiology, physical therapy, home healthcare, phlebotomy stations and specialty testing. A network of hospitalists and urgent care network brings a tremendous and dynamic value to a primary care network since it helps build and develop strong relationships with specialists, hospitals and skilled nursing facilities especially if patients are managed in a strong care-management environment.

A hospitalist network can enhance the primary care network several-fold by helping cover physicians who are strictly out-patient, bring a focused effort to take excellent care of the “captive” inpatients, and ensure continuity of care without the least chance of patient care “falling through the cracks” if thoroughly integrated. Urgent care centers address both managed- and non-managed care patients in an immediate setting thereby assisting both lines of business in becoming profitable.

Market saturation may be important, but presence and proper branding of one's product is more important. Marketing is helpful for new physicians in the area or after a strong base of primary care network is created but is not the mainstay of the network. Activities and events to create a community outreach is important to avoid the appearance of being “carpet baggers.”

Even after a network is built it is important to provide excellent service that is always attempting to improve, is provider- and patient-centric, and is focused on quality and compliance. Inducements are prohibited and are never necessary for patients or providers.

If these principles are followed, a network becomes inevitable and is developed the right way. Patience and systems-thinking is a must, along with a vast vision that does not react constantly, is detail-oriented, and yet, extremely nimble with operational leverage.

“For last year's words belong to last year's language And next year's words await another voice.” — T.S. Eliot, Four Quartets

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