The Greater Rochester (N.Y.) Independent Practice Association last week became only the second clinically integrated IPA to get a favorable advisory opinion to operate from the Federal Trade Commissions healthcare division in its Bureau of Competition.
The ruling offers one example for other physician groups seeking to form an IPA, which would allow physician members, among other things, to jointly negotiate payer contracts while allowing them to practice independently. The FTC, in turn, examines an IPAs clinical integration before it will give approval.
But industry officials disagree on whether the organizations business model can be used as a template for other groups with similar ambitions.
GRIPAs path was difficult. Its attorney, Christi Braun, of Washington-based Ober, Kaler, Grimes & Shriver, said that achieving clinical integration requires physicians money, time and commitment with no guarantees that federal regulators wont decide that their organization does more to stifle competition than to improve quality.
For that reason, the number of IPAs remains small. GRIPA and the Denver-based MedSouth 205-physician network are the only clinical integrations to get a favorable opinion from the FTC, and there are three othersin Chicago, San Francisco and Waukesha, Wis.being allowed to operate without having a positive FTC letter on file, Braun said.
The FTC, however, isnt pushing GRIPAs approach as a model for others. Each of these, when presented to us, get looked at individually, said an FTC staffer who requested that his name not be used. None of them are particular examples of how things should be done.
The staffer said the number of FTC favorable opinions on IPAs is small because the number of requests for opinions is small.
In order to get approval, the FTC staffer said IPAs must demonstrate why horizontal price agreements between providers are reasonably necessary for efficiency enhancements that will benefit consumers, and must show why these agreements are reasonably necessary for the success of an operation that will benefit the public in terms of healthcare quality and cost.
GRIPA Chief Medical Officer Eric Nielsen identified what the IPA has that the FTC approves of: an electronic information exchange for sharing clinical data; an established procedure for developing clinical guidelines; a monitoring system to check if physicians are following the guidelines; and a method for sanctioning them if they dont.
The FTC staffer said another point in GRIPAs favor is that health plans can choose to contract with its network of almost 720 physicians individually or through GRIPA.
Braun thinks GRIPA has developed a model others can use. I dont think its a stretch to say other groups can do the same types of things and achieve the results that GRIPA thinks it will achieve, Braun said.