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Assessing the Challenges and Opportunities for MD Groups That Are Taking On Risk

September 7, 2016
by Mark Hagland
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Mark Werner, M.D. and Bob Schwyn of The Chartis Group share their perspectives on the plunge into risk-based contracting

Pioneering physician groups are helping lead the way in taking on risk-based contracts in a number of contexts—both in terms of federal accountable care organization (ACO) contracts, including the Medicare Shared Savings Program, Pioneer ACO Program, and Next Generation ACO Program, under Medicare, as well as in terms of commercial ACO participation—and in other contexts as well. Indeed, the September/October cover story of Healthcare Informatics will be focusing on the broad strategic and strategic-IT issues that physician group leaders are facing as they move more fully into risk-based contracting.

It was in that context that HCI Editor-in-Chief Mark Hagland recently interviewed Mark Werner, M.D. and Bob Schwyn, of The Chartis Group, the Chicago-based consulting firm. Dr. Werner is Chartis’s director of clinical consulting. In that role, he leads efforts around enterprise physician alignment and leadership, medical group performance, adoption and change management, performance innovation, population health, provider-payer relationships and the translation of strategy into clinical operations. Prior to joining The Chartis Group, he held a variety of executive positions in healthcare, including chief clinical innovation officer for Fairview Health Services, president and chief physician executive of Carilion Clinic and its associated hospital system, and chief clinical officer for Medica Health Plan. Schwyn, a director with The Chartis Group, has years of experience as an HIT executive leading teams in clinical transformation and the design and delivery of solutions for enhancing patient care quality, improving operational effectiveness and achieving excellence in customer service.

Indeed, it is in the context of physician organizations taking on risk and moving into new models of care delivery and payment, that The Chartis Group announced last month the creation of The Chartis Physician Leadership Institute. According to an Aug. 11 press release, “The Chartis Physician Leadership Institute brings together senior physician executives with unrivaled expertise from the nation’s leading health systems, academic medical centers, medical groups and health plans. It is dedicated to advancing health system and medical group performance through innovative solutions that drive physician alignment and engagement, and achieve the highest levels of organizational and operational effectiveness.”

Below are excerpts from the recent interview with Werner and Schwyn.

Dr. Werner, please tell me a bit about your clinical and administrative backgrounds that helped prepare you for the work you’re doing now at The Chartis Group, in the context of the risk-based contracting we’re talking about today.

Yes; my clinical background is as a pediatrician specializing in adolescent health; I no longer practice clinically. And I’ve done a lot of work around various payer-provider strategies and arrangements. I’ve helped to build out multispecialty groups and IPAs that have had to develop risk management capabilities, as well as the IT, and the clinical, capabilities. And it is in that context that we’ve just created the Chartis Physician Leadership Institute. It was officially launched last month, but we’ve been putting it together for the past year. It involves a cadre of physician advisers within Chartis, most of whom have had senior roles in patient care organizations, working with leaders to make sure they have the right alignment and capabilities around their physicians, and have been able to prepare to go forward. I’m the leader, yes.

What has been learned broadly around risk, by the leaders of the most pioneering physician groups?

Mark Werner, M.D.: I think the more experienced and thoughtful medical groups are realizing a couple of things. One is that they have to fully understand what kind of risk they’re taking on, and to be able to distinguish what most people would call health management risk, versus insurance or financial. Health management risk is taking on the risk for creating the right kinds of outcomes, in terms of quality, for patient care and patient management, for clinical performance and outcomes. Then there’s a level around medical expense management risk. Then there’s the insurance-level risk. So it really is three levels. And the leaders are aware of those three levels, and are able to define specifically what they’re able to take on, early on taking on the health management risk, and then gradually taking on the medical expense management risk, and ultimately, the insurance and financial risk. So they have to understand what is driving both the outcomes and cost of the populations they’re taking on, at a high level of specificity that allows them to have an actionable level of understanding, and to develop interventions to address them.

Mark Werner, M.D.