Community Care Physicians and Capital District Physicians’ Health Plan have joined forces to create a new management services organization in a move to outsource the independent multispecialty provider group’s administrative operations while preserving its independence.
The physician-owned medical group employs 420 clinicians in 70 counties in and around Albany, New York, where both companies are headquartered. The not-for-profit insurer covers 400,000 people in 29 upstate counties in the group, individual and public-sector markets. The partnership is expected to close by the end of the year, subject to approval by state regulators, the companies announced last week.
Community Care Physicians, which did not respond to interview requests, will remain independent when the management services organization is in place. The medical group will retain its contracts with other payers and outsource its revenue cycle, human resources and technology operations to Capital District Physicians’ Health Plan.
A growing number of providers are seeking to more closely integrate their operations with payers in an effort to accept a greater portion of patient risk. Nearly 60% of health systems plan to get into risk-based Medicare Advantage payment models next year, with at least 30% following Community Care Physicians’ model and partnering with payers to build data integrity, reporting and technology capabilities, according to survey results the Healthcare Financial Management Association published this month.
Regional not-for-profit insurance companies are participating in many of these ventures, Capital District Physicians’ Health Plan CEO Dr. John Bennett said. Together, the partners will embark on shared-risk arrangements and blend their functions into an integrated system.
“We want to make our patients healthier, and we know that’s going to lead to cost savings,” Bennett said. “But our intent is to allow doctors to be doctors, let them practice and be with their patients.”
Fewer doctors than ever own their own practices, according to a recent Avalere Health survey. Many remaining independent physicians are seeking alternatives to corporate ownership, such as affiliating with regional not-for-profit health plans or contracting with physician enablement startups such as Agilon Health that allow them to outsource the administrative functions of their businesses, said Rick Kes, a healthcare partner at the consulting firm RSM.
“Oftentimes, if you ask the physicians, they’re going to say, ‘I think the best option is for us to remain independent, and to provide the care that those patients have been experiencing before without any disruption.'” Kes said. “Now that there’s tools and technology and companies that are able to do that, that’s driving more noticeable interest from those physician practices.”