Health Care System "In Pursuit of Excellence" Case Example

Advocate Health Care, Oak Brook, Illinois

October 2008

The Organization

Advocate Health Care, based in Oak Brook, Illinois, is the largest fully integrated not-for-profit health care delivery system in metropolitan Chicago.  The faith-based system has eight hospitals with 3,500 beds and a home health care company.  It employs more than 24,500 people, making it one of Chicago's ten largest employers and the fourth largest in the private sector.

The health system has more than 4,600 affiliated physicians, including almost 2,100 in physician hospital organizations (PHOs) and about 800 in three large medical groups.

Advocate's mission is to serve the health needs of individuals, families and communities through a holistic philosophy rooted in our fundamental understanding of human beings as created in the image of God. To guide its relationships and actions, Advocate embraces the five values of compassion, equality, excellence, partnership and stewardship.

The Initiative

In January 2004 Advocate Health Care established the Advocate Physician Partners' (APP) Clinical Integration Program.  The program's goal is to save lives, reduce medical errors and decrease both direct and indirect medical costs, achieved through a partnership between Advocate Health Care, more than 2,900 Chicago area physicians with seven Advocate hospitals, local payers and employers.  Of the 2,900 participating physicians, approximately 2,100 are solo or small group practices, and 800 are employed by Advocate Health Care.

With the overarching objective of improving outcomes and demonstrating efficiency and value, the program focuses on measuring and improving specific metrics in five broad categories: 1) enhancing clinical outcomes; 2) improving patient safety; 3) adoption of clinical technology; 4) patient satisfaction; and 5) efficiency.  Each of the five categories includes multiple measurements for success. 

Managing Chronic Conditions.   The APP Clinical Integration Program goes beyond typical disease management programs by placing physicians at the center of the effort to manage chronic conditions.  Patients with chronic diseases are identified through review of claims, pharmacy and lab data and are entered into the APP disease registries available online to physician members.  Once patients are entered into the disease registry, a combination of patient outreach and physician support ensure that they receive coordinated, top-of-the-line care.

Patient outreach consists of patient telephone calls, mailed educational materials, appointment reminders, and medication reminders.  Physician support consists of training for staff on the latest advances and evidence-based medicine trends, medication identification of suboptimal options and reminders, and health care technology support with access to lab test results, registries and educational materials.  This comprehensive approach results in strengthened patient compliance and improved clinical outcomes.

Utilizing Pay-for-performance.   Pay-for-performance is a critical component of the Clinical Integration Program's success. Program leaders have established performance targets for each of the program's initiatives, based on national best practices, research findings and other recognized benchmarks.  Economic incentives encourage physicians to meet or exceed their performance targets in each of the metrics that are appropriate for their specialty.

Physician performance is monitored throughout the year and reported to each physician on a quarterly basis.  At the end of the year, financial rewards are distributed to physicians based on their performance.  On the flip side, physicians that underperform receive sanctions such as forfeiture of incentive payments, enrollment in corrective action programs, and possibly procedures to terminate the physician from the Advocate Physician Partners' network.

The system encourages collaboration and improved communication, because to successfully achieve the desired benchmarks physicians and hospitals must work together to coordinate patient care.  In addition, physician peer groups also receive performance incentives, encouraging physicians to work together with their peers.

Program Administration.   APP's annual administrative budget is $20 million.  Much of the CI program funding has come through a shift in existing APP resources, as well as improved efficiencies through automation and technology.  Currently 24 FTEs are dedicated to the Clinical Integration Program, including employees specializing in information technology, contracting, provider relations and administrative support.

The program is governed by the APP board.  The board consists of 18 members, including both Advocate Health Care executives and Advocate Physician Partners physicians.

Physician Participation and Support.   Initial participation in the program required a "leap of faith" from physician partners.  While some were more dedicated to the program than others at the start, as the program has become more established and the results are proven the initiative now enjoys broad buy-in and support from all physician partners.  Physicians appreciate the constant communication, quarterly reports with their individual performance scores, and the annual incentive payment provided.  In spring 2008 the physician partners together received $25 million in incentive payments for their performance in 2007.  The pay-for-performance component is critical to building physician support and tangibly rewarding performance that results in improved quality of care. 

Community Partnerships.   In addition to close collaboration between the hospitals and physicians, the Clinical Integration Program is successful because of partnerships with local health plans and employers.  The health plans assist with valuable data and information sharing that allows the program to track provider performance to determine how well each individual provider is meeting the program's quality metrics.

Representatives from Advocate Physician Partners also meet regularly with local employers to review the program's annual Value Report and seek employer feedback.  The meetings allow Advocate to share the details included in the Value Report, including new initiatives such as generic prescribing and new technology purchased, as well as specific metrics such as outcomes in diabetes, asthma, and coronary artery disease and congestive heart failure.  In addition to sharing program results, Advocate representatives seek employers' input for next steps moving forward, asking employers what is most relevant for their workforce that Advocate should incorporate into the next version of the Clinical Integration Program.  As a result of these discussions, the program will add a new focus on childhood obesity in 2009.

Information Technology Requirements.  Comprehensive patient registries are necessary to ensure successful management of patients' chronic diseases.  Until recently the program used "home grown" excel spreadsheets that were shared via the Internet.  As the program has grown this system has become more cumbersome, requiring a more robust and automated system.  Advocate Physician Partners is currently in the process of implementing a commercial product purchased from a vendor that combines all of the registries and spreadsheets into one streamlined database.

In addition, Advocate Health Care is in the process of implementing an inpatient electronic medical record system that allows Advocate Physician Partners physicians to access current information about their patients treated at any Advocate facility.  In 2007 Advocate completed the implementation of the system at six Advocate hospitals.  To ensure that physicians can easily access online information such as the patient registries and CPOE, a high-speed Internet connection is a requirement for membership in the Advocate Physician Partners program.


While there are over twenty initiatives as part of the program, in 2007 the majority of the program's emphasis was placed on seven initiatives: 1) generic prescribing; 2) smoking cessation education; 3) depression screening for the chronically ill; 4) asthma care; 5) diabetic care; 6) coronary artery disease and congestive heart failure; and 7) childhood immunization.  Each of these initiatives has resulted in a significant improvement in quality and cost of care.

  • Between 2006 and 2007 Advocate Physician Partners increased the use of generic drugs by four percent, resulting in an incremental annual savings of approximately $6 million.  For the four-year period from 2004 to 2007, increased use of generic medications has resulted in savings of more than $31 million annually.
  • In 2007 the smoking cessation initiative resulted in an additional 1,380 patients quitting smoking over and above the national quit rate.  Using 1999 medical costs, the initiative resulted in total annual savings of $6 million, comprised of direct medical savings of at least $2.9 million and indirect savings of $3.1 million.  The initiative saved Chicago-area employers an additional estimated 7,814 working days of lost productivity.
  • In 2007 Advocate's depression screening and subsequent treatment in patients with diabetes or who had a cardiac event resulted in an additional $3.2 million in direct and indirect savings over the standard practice.
  • The asthma management program resulted in additional direct and indirect annual medical cost savings of approximately $1.9 million compared to Chicago-area averages in 2007.  The initiative resulted in an estimated additional 4,075 days saved annually from absenteeism and lost productivity.
  • Using data from a 1995 study of costs, the diabetes care initiative resulted in an additional 5,000 years of life, 8,000 years of sight, and 6,000 years free from kidney disease.  Using 1995 dollars and calculating savings using just one of the 12 measures (such as hemoglobin or poor control), Advocate Physician Partners saved an additional $606,000 in direct medical costs in 2007.
  • In 2007 the coronary artery disease and congestive heart failure initiative resulted in 65 saved lives, 158 avoided days of hospitalization and a medical cost savings of over $158,000 compared to national averages.
  • Advocate Physician Partners' immunization rate is 14 percentage points better than the 2006 Illinois average for Combination 2 (DPT, polio, MMR, Hib, hepatitis B and chicken pox) and 8.5 percentage points better than the 2007 national norm for NCQAs for Combination 3 (DPT, polio, MMR, Hib, hepatitis B, chicken pox and pneumococcal)vaccines.

Overcoming Challenges Related to Lack of Data.  When the program was first established, gathering claims data from payers was challenging, in part because some payers did not have the technology to easily share their information.  In addition, some payers were concerned about HIPAA violations.  Once these concerns were addressed and Advocate was able to clearly communicate the benefits for all involved, payers were more comfortable participating. 

In some cases a work-around was necessary to share the data because all the data was not provided in the same format.  The health plans have now agreed to allow physicians to submit a copy of their electronic claims to the program, allowing Advocate to use the claims data directly.  This has required additional resources for Advocate.

The Health System, Physicians and the Community Benefit Together.  Advocate Health Care is now better aligned with local physicians, which represent nearly 80 percent of all hospital admissions.  This improved alignment allows physicians to drive additional improvements in the system's hospitals, such as new patient safety initiatives and accelerating the adoption of clinical technology.

Physicians participating in the Clinical Integration Program appreciate the focus on quality and clinical outcomes, and being rewarded for their quality of care rather than utilization.  In addition, they are genuinely excited about the improvements in care patients receive.

The community also benefits from more coordinated care, improved quality of care and improved outcomes.  Advocate Physician Partners has recently initiated a marketing campaign to educate the public about the program, focusing on coordination of care for diabetes and asthma patients within APP.  Since the campaign's launch, referrals from the call center for APP appointments have risen seven percent, while non-APP appointments have dropped nearly 14 percent. 

Advice for Implementing a Similar Program.  Engaging physician leaders is critical to the success of a program similar to the Advocate Physician Partners' Clinical Integration Program.  When physician leaders are excited about the program, they will be committed to the program's success and encourage their colleagues to share the same commitment.  

Engaging practice managers is important as well.  Many of the small independent practice managers have little opportunity for education and development; offering training sessions helps them understand their role in the program, and also provides them with opportunities for continuing education.

In addition to engaging physicians and practice managers, when initially starting a similar program organizations should start small, focusing on early "wins" before expanding the program further.  Understanding the community's unique needs and focusing on those will help achieve those early wins.


Because the program is affiliated with Advocate Health Care, participants offer a wealth of ideas and diverse vantage points.  This helps ensure that a broad range of ideas and perspectives are considered when new initiatives are undertaken, and that the program meets the diversity of the area's needs.  In addition, the pay-for-performance approach encourages healthy internal competition amongst the physicians as they compete based on their performance in the quality metrics.

Since the program's initial implementation, Advocate has learned that acceptance and support of the program takes time.  While there was some initial resistance to change, once there was data available demonstrating the program's success, physicians that were initially hesitant have come to support the program.

In addition, the program continues to evolve over time to meet both provider and patient needs.  The medical groups have created diabetes clinics staffed by pharmacists or advanced practice nurses, which has taken away some of the responsibility from the primary care physicians.  While some of the physicians may have initially felt threatened by this transition, they now support the effort and appreciate that it is a better model.

Contact Name:  Lee Sacks, MD, EVP, CMO
Title: Chief Medical Officer
Tel:  (630) 990-5102
Fax:  (630) 990-4788



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