Solving the Clinical Service Line Puzzle ? Part 2

Tuesday, November 22, 2016 | Larry Sobal

In my Part 1 blog last week, I covered some of the challenges that organizations face when trying to create and operate service lines, and why many are underperforming. Today I will share some of the attributes that are most commonly found in high-performing service lines and the key decisions to be faced along the way.

First, an organization needs to clarify the role of the service line. As noted last week, it is not uncommon to find a service line with a vision of integrating and consolidating clinical services in a systemic approach to increase quality and reduce costs, while other parts of the organization are still focused on volume and revenue growth. This misalignment of intentions (and incentives) play havoc with the culture and lead to sub-optimization and dysfunctional decision-making.

Successful service lines focus on being an integrator for the delivery of superior operational, quality, financial and market performance across the full care continuum – as opposed to hospitals, physicians and other organizational components operating alone. Furthermore, the most successful service lines focus on clinical, operational and market strategy and rationalize the service line assets as a “portfolio” to achieve optimal efficiency and scale across the system. In some cases, this means facing difficult decisions to centralize or consolidate services or shedding underperforming services, excess capacity or non-core assets and redirecting resources to pursue new growth opportunities, addressing an unmet need or emerging demand.

Although every high-performing service line has adopted customized aspects to thrive in the unique structure and culture of its system, there are some common attributes that they typically share.

Organizational Attributes:

• Governance is well defined with role clarity
• Scope is well defined and ideally covers the full continuum of care
• Leadership structure incorporates physician and administrator dyads at multiple levels with clear responsibility/authority and also incorporates a variety of leaders from across the continuum of care along with support services (quality, finance, marketing, etc.)
• Strategic plan with clear goals and tactics linked to overall organizational strategy with well-orchestrated execution
• Balanced scorecard that tracks service line financial, operational, clinical and service performance

Operational Attributes:

• Culture, process and competency at process improvement and variation reduction
• Data and analytics capability and support that aggregates service line information
• Focus on access and resource optimization (Physician and Advanced Practice Clinician)
• Adopted standards for scheduling in terms of ambulatory services (especially clinic) and work flows
• Formal provider workforce staffing plan focused on meeting future demand
• Physician and staff roles are structured to allow them to work at the top of their license
• Work environment designed to deliver the “Quadruple Aim” in terms of clinician and staff satisfaction as a critical component to achieving higher quality, cost and improved patient experience

The most successful service lines focus on clinical, operational and market strategy and rationalize the service line assets as a “portfolio” to achieve optimal efficiency and scale across the system.

Clinical Attributes:

• Culture promotes clinical safety and quality through formal training, processes and measurement
• Defined quality objectives as part of the strategic plan
• Physician-led subcommittee structure/forums focused on clinical priorities, data transparency and objective improvement
• Analytical capability to assess clinical performance across all settings of care
• Adoption of evidenced-based or consensus-based standards of care or clinical guidelines
• Incorporated appropriate use criteria in real time to influence care decisions

Transformational Attributes:

• There is a clear understanding of clinical performance in relation to CMS and commercial payers with value-based reimbursement or incentives
• Data to understand episodic costs of care and how resources are utilized by specific populations across the care continuum
• Standardized clinical approaches for specific sub-specialized patient populations (either by disease category or procedure)
• Data warehouse or HIE that aggregates and reports disease control parameters and offers predictive analytics
• Effective and integrated Care Management program to work with patients across the continuum and guide them to the appropriate services
• Service Line has structured multidisciplinary clinical integration efforts that bring together the necessary clinicians (primary care, ED, hospitalist, specialist, nursing, ancillary, etc.)

A question we are often asked is how to best structure the service line in terms of operational reporting relationships and subcommittee components. Regarding reporting relationships, there are as many models as there are service lines. The graph below, taken from our Cardivascular Service Line Medxcellence Survey shows that there is a wide variety of which functions report directly to a cardiovascular service line executive, versus a matrixed relationship, versus none at all.  Since it is impossible to have all aspects of a clinical service line – across a full care continuum – have a direct reporting relationship to the service line leadership, the most critical element is an organizational culture that fosters participation and collaboration in the context of an organizational strategy that cascades and aligns system goals to each service line.

 

Likewise, the service line governance structure can vary widely among organizations. Often we encourage initial service line structures to stay simple and focus on getting the right people together and learning to collaborate and problem solve. However, a high-performing mature service line usually evolves to where the governance structure is focused on clinical improvements, in addition to the responsibility for financial and operational oversight of the service line, and might look something like this:

 

In summary, there are a variety of organizational, operational, clinical and transformational factors to contend with. However, creating a strong and sustained governance in terms of vision, structure, leadership and alignment, paired with effective strategy execution and competency in attaining real clinical improvements, are likely to lead to service line success.

If you are interested in contributing to some service line research, MedAxiom has developed a CV Service Line assessment mechanism, known as MedXcellence, where you can add your CV Service attributes to the database. The survey can be accessed at www.medaxiom.com/medxcellence. Chose the CVSL Survey option to participate. I’ll share some information from the data collected next week.

 

 

llustration: Lee Sauer

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Larry Sobal is Executive Vice President of Business Development at MedAxiom. He has a 35-year background as a senior executive in medical group leadership, hospital leadership and insurance. Larry consults, writes and presents on topics relevant to transforming physician practices and health systems.

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