That's the environment that providers are immersed in and they have to decide how they're going to respond. There are two broadly focused strategies and we're not really sure which one is going to work.

One strategy is for hospitals and physicians to develop very integrated care models. An example would be hospitals employing physicians and marketing an integrated health care system that will provide all of the services that are necessary for ultimately what may be a capitated rate.


In other words, the hospital system becomes almost like the insurer-they take the per member per month payment and they provide all the services. They do that because it allows them to have all the pieces under the same umbrella.

Another strategy would be for a hospital or a physician to be very adept and good at the way they deliver value. For example, a hospital that provides the outstanding cancer oncology services in a market and has the best outcomes and the best patient satisfaction.

DOTmed: Do you think it makes more sense for a physician to start their own practice or join a health care system?

GW: I don't think it's necessarily the case that physicians have to join a health care system at this point. I think that some physician practices believe there is this vertical alignment between hospitals and may feel like they have to join one of the systems so they won't be left out in the cold. But I doubt that's going to happen in the near-term.

However, I do think it's going to be more and more difficult for a physician to be successful in a very small, two doctor office. The broader push towards value for payment is going to require physicians to have IT systems in place to be able to track and report quality measures.

I think it does make sense to think about how, as a physician you may want to be part of a slightly bigger group where you have the resources to handle these challenges. Maybe they don't need to necessarily become affiliated with one health care system but at a minimum they should think about scale and planning to meet these challenges.

DOTmed: In general, what do you think the ACA got right? What do you think it got wrong?

GW: There is a values question buried in there as to how important it is to a person that we have universal health insurance. I do agree with the goal of everyone having insurance.

I think that it made sense to pursue a goal of universal health insurance and I do think that the individual mandate with subsidy, which was the strategy that was pursued, was the best way to do it.

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