Trinity Health, an 86-hospital Catholic system based in Livonia, Mich., has signed a definitive joint venture agreement with Heritage Provider Network to advance its strategy of coordinating care for specific groups of patients.
Under the deal, Trinity and Heritage, a managed-care network based in Marina del Rey, Calif., are creating care networks together in markets across the country. The networks, similar to accountable care organizations, are composed of primary-care physicians, hospitals, clinics and other providers to manage care for the different patient populations.
Trinity and Heritage will then contract with health insurers for full-risk capitated payments for those care networks. The organizations say the joint venture, named Trinity Health Partners, will help move their systems more quickly away from the current fee-for-service reimbursements and toward their shared goal of a “people-centered health system.”
“We're putting in place a system that is wired and engineered to see the patient wherever they are,” Dr. Richard Gilfillan, CEO of Trinity, said in an interview at the J.P. Morgan Healthcare Conference in San Francisco.
Trinity and Heritage have been in negotiations on the care networks for the past nine months. Gilfillan said the networks will exist in a couple of markets to start and will expand as needed.
Health plans have liked the joint venture idea so far, said Heritage CEO Dr. Richard Merkin. Conversations have already begun with several insurers. And “even health plans who are not in the 21 states that Trinity is in are calling me” and expressing interest, Merkin said.
Heritage and Trinity are both heavily involved in the concept of management health for defined populations. Gilfillan, who previously led the CMS Innovation Center, has made a concerted effort to establish ACOs participating in the Medicare Shared Savings Program in each of Trinity's markets. Heritage has been part of Medicare's Pioneer ACO demonstration from the beginning, which gave Gilfillan and Merkin an early opportunity to meet and collaborate.
What makes Trinity Health Partners different from other population health models, the executives say, is the emphasis on technology. Gilfillan and Merkin said they want to make sure “we're not practicing 20th-century medicine.” To do this, the providers will use Heritage's proprietary software to track patient outcomes and patients' health histories to find out how the right doctor can be matched with the right patient instantaneously.
“It's giving doctors what they need in real time,” Merkin said.
The hospital and physician communities have generally embraced these types of population health models, but the models also been met with some skepticism. Some industry observers have said it is unclear if these coordinated-care efforts will improve patient outcomes and save money, or if they will flame out like the 1990s wave of HMOs. Even the CMS has altered its ACO programs to allow more time for providers to take on the full financial risk. The Pioneer ACO model, in particular, has been a poster child for the challenges associated with striking the right balance of risks and rewards.
But Gilfillan and Merkin said that there is a “strong business model” for their iteration of population health management. “We believe the (Affordable Care Act) has provided lots of reasons for us all to move toward a people-centered health system and care coordination,” Gilfillan said. “This is, in our minds, the logical extension of that.”
Trinity, a system with more than $13.6 billion in revenue, is still in the early stages of its post-merger integration. Trinity combined with Catholic Health East in 2013. Heritage has about 4,000 primary care physicians and 33,000 specialist physicians in 12 owned independent practice associations.
Follow Bob Herman on Twitter: @MHbherman
(This story has been updated with a correction.)