Monday, May 12, 2008

A New Term: Coordinated Delivery Systems. Better than Integrated Delivery Systems?

In a prior post, the Disease Management Care Blog described how Boeing was ‘assembling’ a medical home initiative. In thinking about this some more, the DMCB wonders if Boeing is assembling something far greater with important implications for population-based health care.

Large employers are increasingly becoming self-insured. To manage their insurance risk, they use a standard benefit, rely on a provider network, have wellness programs, may use prior authorization and/or concurrent review, contract an outside disease management vendor and, as Boeing demonstrates, are starting medical home projects. Considering the spectrum of need in an insured population, this is a reasonable approach, right?

The approach of employers (and many mainstream insurers, by the way) is not only to have those components but to sponsor interlocking combinations of wellness, prevention, episodic care, primary, secondary and tertiary care, chronic illness care management, complex care coordination and catastrophic illness care. In some areas of the country, a single source can provide the full spectrum of services. They are called ‘integrated delivery systems.’ In the remainder of the country, however, IDS are simply not available.

None of the above is necessarily news. What is news is the advent of an ‘outsourced and modular’ approach to health care that resembles the modern industrial processes. As mentioned before, many manufacturers in the U.S. have foregone ‘owning’ the entire factory and are instead relying on global network of suppliers who provide the ‘just-in-time’ components made to precise specifications. The result, in the case of Boeing, is a jet that really consists of parts (according to Wikinomics) that are practically ‘snapped’ together. The approach to health care isn’t turning out to be all that different. Employers are ‘assembling’ outsourced care components.

Note that in a typical supply chain, failure to deliver the components means giving up the business. The DMCB has watched employers literally fire health care entities and ‘insert’ new ones, much like swapping a turbine made by GE for one made by Pratt and Whitney. These employers are more than willing to ‘swap out’ hospitals, physician groups, disease management vendors and wellness entities based on price and outcomes. While the fired vendors have protested that this disrupts patient care, the vendors taking their place claim to have processes in place that will minimize the disruptions. In looking at the processes, they have a reasonable point.

The DMCB isn’t sure all this is necessarily bad. Integrated delivery systems’ transfer pricing and loyalty to their own systems don’t consistently translate into the best value for the health care consumer. Maybe an alternate approach is 'coordinated delivery systems' typified by the Boeings of this world. A quick Googling didn’t define ‘CDS’ in this new context: the DMCB would say these are organizations that hold the health insurance risk, have fiduciary responsibility for their enrollees, have separate access to all the components normally owned by an integrated delivery system and can force a market dynamic, mutual interlocking and substitution of the components in their health care purchasing decisions.

If Boeing is not alone in this new trend, the Disease Management Care Blog suspects CDS' (or what ever they are best called) will be a force to be reckoned with.

1 comment:

Anne said...

Outsourcing pieces of processes in the social services world (healthcare services delivery isn't the same as turning out widgets in an industrial process, as patients find when they are treated as widgets by the healthcare system) does not work as a business policy (more expensive) and as a social policy (lack of accountability, inability to enforce quality and safety). 1) Contracting out of direct personal services diffuses accountability, as clients of public programs have found out--negotiating the maze of who is responsibile for the level and quality of service becomes unmanageable for the user and a bureaucratic nightmare for the provider. Who is ultimately accountable--the provider or the contractor? 2) This model also changes the role of the service provider from one of direct service to an administrative and oversight role--roles that require different skill sets and responsibilities and that direct providers are not trained for and for the most part don't want to fulfill. The provider's role is made more complex in a different way: coordination, oversight of, and accountability for multiple different pieces and suppliers. 3) Finally, we have seen the fallout from this model in the industrial world in the dangerous and deadly--and hard to regulate--products like pet food, children's toys, etc. that come from China (just one example). This is part of the problem that arises from the process change and role change in the previous point and highlights how the piecemeal approach and inability to find a locus of accountability in these types of "new" diffuse processes would have even more serious ramifications in delivering healthcare services that are so necessary for the rest of our lives to work, let alone in improving healthcare quality and patient safety.