At first glance, Cleveland Clinic and Mayo Clinic offer similar advantages to their dozens of community-hospital affiliates across the U.S.—national branding with an elite academic medical center for a competitive edge, access to clinical and management expertise, research opportunities, and so on.
Both are expanding their affiliate networks, but neither anticipates unrestricted growth. The focus, both big-name organizations recently told Healthcare Dive, is on quality, not quantity.
But digging a little deeper, it becomes clear that each has its own strategies and aims for affiliates.
Are "premium brand" affiliations just a fad or are they here to stay? Are major academic institutions likely to lead the way toward national integration of acute-care delivery? Those questions were posed last fall by Michael Koppenheffer, executive director of The Advisory Board Co. His firm found dozens of strategic partnerships, including formal affiliation programs by Mayo Clinic, Cleveland Clinic, MD Anderson and Duke University Health System.
By offering affiliations, academic health systems can extend their brands across the U.S.—and attract national employer contracts—without bearing costs associated with actual acquisitions, Koppenheffer said. In fact, he described such affiliations as "a potential first step toward formal acquisition."
But Mayo Clinic and Cleveland Clinic affiliates contacted by Healthcare Dive would take exception to this characterization: a small, rural system stressed its independence; and a large, urban system cited its prominent clinical role in its own right within its region.
Cleveland Clinic seeks national employer contracts
Cleveland Clinic Affiliate Network is in the process of vetting potential new affiliates and considering additional clinical areas of focus, said Joseph Cacchione, M.D., chairman of Cleveland Clinic's heart and vascular operations and strategy.
Overall, Cleveland Clinic had 32 clinical hospital affiliations and alliances in seven states and Washington, D.C., as of July 25. Its affiliations are spread across several clinical areas: 21 heart, three oncology, five neurology-related, two transplant and one bariatric.
(Separately, Cleveland Clinic has affiliates in the National Orthopedic & Spine Alliance. In September 2013, Cleveland Clinic launched NOSA in conjunction with three orthopedic practices. The alliance contracts directly with large employers, providing orthopedic and surgical services to their employees for a bundled payment.)
Cacchione described an intense six- to 12-month assessment process for potential affiliates. Cleveland Clinic looks into community hospitals' clinical and operational quality, he said, and also seeks what he describes as a "cultural alignment."
"Our goal is not just to brand...but to assess organizations, and if they have satisfactory quality metrics, we then brand them," Cacchione told Healthcare Dive. "And once they reach a certain threshold, they become part of our national contracted network of hospitals."
Currently, Cleveland Clinic's hospitals in Cleveland and Florida, Cadence Health in Chicago and MedStar Health in Washington, D.C. are part of its national "alliance," he said, and several more hospital affiliates are in transition to this status. Cleveland Clinic is using the alliance to contract with large, self-funded employers, independent practice associations (IPAs), business coalitions and commercial exchanges—offering a carve-out benefit for advanced cardiac care.
"We're paying particular attention to the employers right now, but we will expand from the employers and the exchanges to IPAs," he said, explaining that Cleveland Clinic seeks to contract with risk-based organizations, including accountable care organizations, by offering heart surgery "with predictable quality at a predictable price."
"Our ultimate goal by the end of 2015 is to have 25 to 30 [community hospitals] in our [Cleveland Clinic Cardiac Specialty Network]" he said, "and build up the orthopedic network" to the point where patients in large metro areas are no more than two hours from a NOSA site.
Cacchione explained that each of its network members has exclusivity in its region. "We won't partner with anybody else in D.C.," other than MedStar, he said. "We don't see much more than 30 in the cardiac network...Then it's about creating benefit design and a network of providers around quality."
According to Cacchione, Cleveland Clinic has "an actively-managed network" that he contrasts with Blue Distinction Centers, which are recognized and branded by the Blue Cross and Blue Shield Association for their expertise in six areas of specialty care, including cardiac care and spine surgery.
Nationwide, about 300 of 1,200 cardiac surgery centers are part of the Blues network, he said, and quality data are submitted for review only every three years. "They're trying to create a broad network just for the purposes of contracting," he said. "Our network is based just on quality."
In fact, he said, Cleveland Clinic will terminate the relationship if a community affiliate has poor clinical outcomes—and has done so once. "We've been in 60 to 70 hospitals in the last five years for cardiac review," he said. "Of those...about 20, about one-third, will end up as part of the network"—starting as affiliates and trying to move up to contracting as part of its national alliance.
Mayo Clinic wants 'group of like-minded organizations'
The Mayo Clinic Care Network began in September 2011. "Our goal was to offer more people and communities access...so that patients can benefit without necessarily having to travel to a Mayo Clinic facility. We believe we're doing that," said David Hayes, M.D., the network's medical director.
Currently, its network has 29 member-hospitals in 15 states, Puerto Rico and Mexico, and it is growing, he said.
Mayo doesn't have a specific numerical goal for network membership in mind, Hayes said. "Rather we feel it's more appropriate to grow the network organically, adding members based on interest, compatibility and a similar outlook," Hayes told Healthcare Dive in a statement. "And we are careful to take stock periodically, to ask ourselves—and our members—an essential question for this institution, 'Are we providing value?' The network and these relationships exist to serve patients better."
Mayo's network was created "to assemble a group of like-minded organizations that share a common commitment to improving the delivery of healthcare through high quality, data-driven, evidence-based medical care," Hayes said.
Is it a matter of geography, too, in Mayo's selection of affiliates?
"We assumed, when we began the network, that these organizations would tend to be located around our three campuses in Arizona, Florida and Minnesota," Hayes said. "But we found that many organizations were interested in collaboration, and so it became less about geography and more about philosophical alignment. We want to identify and work with those physicians, hospitals and healthcare systems that are truly interested in collaborating to benefit patients."
Community hospitals interested in joining Mayo's network must meet strict criteria and undergo an extensive review process that evaluates a broad range of quantitative and qualitative criteria, he said. "Our 'due diligence' includes a thorough assessment of the organization’s governance structure, clinical practice and business practices, as well as its quality/safety/service efforts," he said.
Community health systems linking up with these prestigious healthcare organizations, have different takes on why these affiliations matter to them. For example:
Why Cleveland Clinic matters in Washington, D.C.
MedStar Heart Institute began its alliance with Cleveland Clinic in January 2013.
"Overall, it's been a very positive experience for us, our alliance with the Cleveland Clinic," said Stuart Seides, M.D., physician executive director for MedStar Heart Institute in Washington, D.C. He described it as more of an equal relationship with another nationally-prominent institution, as compared to Cleveland Clinic working with a small community hospital's heart surgery program. MedStar Heart Institute handles heart care for its 10-hospital system, including the 900-bed Washington Hospital Center, in a region extending up to Baltimore and down into northern Virginia.
MedStar has been "in the thick of it" for about 18 months and prior to that was ramping up for the program in 2012, Seides told Healthcare Dive. He said Cleveland Clinic has made a name for itself not only for the quality of its cardiovascular care, but also for its data-driven system. MedStar has enhanced its own capabilities through the alliance, and now its data processes are "more detailed and reach into more areas of cardiovascular practice," he said.
Seides notes that Cleveland Clinic has a clinical and safety officer, and he recently appointed someone for the same position at MedStar in order "to take data and operationalize it."
Seides also cited the benefits of being part of Cleveland Clinic's alliance for national contracting for cardiac services. He added that MedStar is working with Cleveland Clinic on medical education, research and innovation programs.
Also, there is the branding advantage. "A brand without substance is quickly discovered as being hollow, but this is a branding that comes with great substance," Seides said. "Cleveland Clinic is being scrupulous about protecting the brand. It's the number one-brand on heart care in the world. We have a strong regional reputation, and we're now linked arm-in-arm with" this top-rated organization.
Why Mayo Clinic matters in rural Arizona
In the fall of 2011, Kingman Regional Medical Center was the second health system to become a member of Mayo Clinic Care Network, said Brian Turney, Kingman's president and CEO. "They have vetted quite a few health systems since then, and are getting close to 30 [affiliates] now," he said.
Nonprofit Kingman is an independent, two-hospital health system based in a town of the same name that has about 50,000 residents; its total service area covers about 70,000 people in northwestern Arizona. Its annual budget is about $240 million, Turney said.
Turney said the affiliation brings clinical advantages to Kingman's clinicians: AskMayoExpert, a web-based information system, lets doctors find information 24-7 on medical conditions; and eConsult enables Mayo Clinic physician experts to share opinions on patient conditions with community-based doctors. "Being a rural facility, we don't have sub-specialists in all areas," he said. Using eConsult "gives us an additional resource without going to Scottsdale or Rochester [Minn., Mayo's home base]."
"We're a medium-sized community hospital, and they have a lot more expertise on process models [i.e., the best way to deliver care], physician order sets, and...a huge repository of well-researched patient education" materials, Turney said
Mayo Clinic also offers healthcare consulting to its affiliates. "We might be working on a quality project and want administrative and clinical consultation, and Mayo Clinic staff will work with us," Turney said. He declined to disclose the fees related to the affiliation.
Why Kingman and Mayo? "We'd already done informal projects with them. We used Mayo Clinic to do all our stroke consultations [with 24-hour/day telemedicine availability] in the ER," Turney said. "So we just evolved from doing projects to actively becoming an official network member."
Kingman highlights its national branding with Mayo Clinic—to a point. "We're allowed to state publicly that we're a member of Mayo Clinic Care Network. We are allowed to market that," Turney said. "It doesn't hurt to let people know [that we're] trying to improve processes with the help of [an organization] like Mayo Clinic—but we're still an independent community hospital."
Kingman's board "at this point would like to remain independent," and is working to stay on this path, Turney said. "Whether or not it will be sufficient over the next five or 10 years remains to be seen. But at this point at least, this is the direction we intend to go."
According to Turney, Mayo Clinic understands the dynamic. "The idea is to keep as much care locally as possible," he said. "Mayo Clinic has been very non-aggressive in trying to solicit referrals. They've been very sensitive to that." No one is talking about taking Kingman’s membership "to the next level" and pulling it into the Mayo fold: "There have been no discussions or hints along those lines," he said.
Is Kingman taking advantage of Mayo Clinic's available resources?
"Our biggest challenge as an institution is taking the time to tap into all those resources," Turney said. "Physicians are busy. Administrators are busy...We're still learning what's out there. I don't think we've tapped into it nearly as much we could. But that's kind of up to us."