IOWA CITY, Iowa (AP) — Four major Iowa hospital systems announced Thursday that they have formed a new partnership aimed at improving the quality of care and cutting costs in response to an industry push to link payments to performance measures.
The University of Iowa Health Alliance encompasses 50 hospitals, 160 clinics and thousands of doctors. It will allow separate hospital systems to share costs in information technology systems and other areas, coordinate patient care and collect data aimed at identifying best practices and improving patient outcomes.
The alliance includes University of Iowa Health Care, Davenport-based Genesis Health System, Des Moines-based Mercy Health Network and Mercy-Cedar Rapids.
The announcement came the same day that the U.S. Supreme Court upheld President Barack Obama’s health care reform law, but leaders said it was in the works for months and would have happened regardless of that ruling. They said the partnership comes in response to a push by insurers and government programs to tie payments received by health care providers to efforts to better manage and coordinate care and control costs.
“We recognize there isn’t a business in this state small or large, including our own, that hasn’t been dealing with the escalating cost of care,” Mercy-Cedar Rapids CEO Tim Charles said at a news conference in Iowa City that other hospital leaders joined by video feed from Davenport and Des Moines. “We’re hearing the message loud and clear. It’s incumbent on those of us who provide these services to develop new models and deliver those new models to the state … in a much more cost-effective manner.”
Insurers and government programs are increasingly giving financial incentives to doctors and hospitals that use new approaches aimed at reducing hospital admissions and emergency-room visits and improving care for populations with chronic conditions.
Two of the new concepts include patient-centered medical homes, in which primary care doctors track a patient’s visits, attempt to make preventive services available and coordinate care among specialists; and accountable care organizations in which doctors, specialists, and hospitals coordinate care to reduce duplication and medical errors.
Charles said that it would cost Mercy-Cedar Rapids up to $9 million to invest in new information technology, expertise and data-collection efforts needed to form an accountable care organization. He said the alliance would allow four health systems to share those costs and to build the necessary infrastructure once.
Hospital leaders said they would work out more details in the coming months as they build a culture of cooperation that has not existed previously. They emphasized that all four hospital systems would remain independently governed and keep their own identities, but they said they envisioned joining forces to treat patients in a number of ways.
For example, Mercy in Cedar Rapids offers dialysis to patients suffering from kidney failure but could better coordinate care with specialists in Iowa City who might ultimately perform a kidney transplant, Charles said, offering one such example. A child with a heart condition who might need routine treatment at one hospital but ends up getting surgery in Iowa City would have a smoother experience because the providers will be able to share records more easily.
Dave Vellinga, president and CEO of Mercy Health Network, which owns 11 hospitals and 27 contracted-affiliated hospitals, said the partnership was “a substantial opportunity” to address the most pressing challenges facing health care providers.
“We know that we can provide a better product for our patients: greater care that’s more efficient and more effective over the long term,” he said.
