Structured Medical Group Governance at Providence Health

Providence Health implemented structured medical group governance to integrate and unify its physician practices and create a system of collaborative leadership.

Background
As physician practices increasingly integrate with hospitals and health systems, the need for effective governance frameworks has never been greater. According to the Physicians Advocacy Institute, as of January 2022, nearly 74% of U.S. physicians are employed by hospitals, health systems, or corporate entities[1].

While integration promises improved care coordination and efficiency, achieving true alignment is a complex challenge. This case study explores how Providence Health implemented structured medical group governance to integrate and unify its physician practices and create a system of collaborative leadership.

The Challenge: Fragmented Integration
Providence Health, a not-for-profit Catholic health system with over 9,000 providers across seven western states, faced challenges common in large healthcare systems:

Physicians felt distanced from strategic decision-making.
Newly integrated groups operated autonomously, lacking cohesion and synergy.
Variability in governance structures hindered the alignment of strategic goals.

To address these issues, Providence Health sought to develop a governance framework that empowered physicians to participate in leadership, fostered alignment across regions, and supported strategic decision-making.

The Solution: Multi-Tiered Medical Group Governance

Providence Health designed and implemented a multi-tiered governance structure that includes:

System-Level Medical Group Board: Composed of 20 members, 50% of whom are practicing providers, this board reports directly to Providence’s corporate governing board, ensuring a direct line of communication and influence.
Regional Medical Group Boards: Tailored to the unique needs of each region, these boards consist of at least 50% practicing providers and include diverse representation by specialty, geography, and demographics. They enable localized decision-making while maintaining alignment with system-wide goals.
Collaborative Framework: Individual board members serve on both system-level and regional boards to facilitate information flow and create synergies across governance levels.

Keys to Success

Clarity of Purpose: From the outset, Providence’s leadership was clear about the goal of governance—to create synergy among physicians and align practices with organizational strategy. A $30 million investment over five years underscored this commitment, funding initiatives like electronic medical record optimization and clinical documentation improvements.
Inclusive Design: By allowing a year for frameworks to take shape, Providence involved providers in discussions about governance structure, fostering broad buy-in and ensuring the framework addressed real needs.
Diverse Representation: Governance boards were intentionally designed to include balanced representation across primary and specialty care, advanced practice clinicians, and diverse racial and gender perspectives.
Empowered Decision-Making: Boards were granted authority to make meaningful decisions. For example, the system-level board influenced COVID-19 response plans and secured investments in voice recognition software for clinical documentation.
Ongoing Education: Continuous education on healthcare trends, finance, and strategic planning ensures board members are equipped to provide informed leadership.

Outcomes and Impact

Improved Provider Engagement: Regions with established governance structures reported higher provider engagement and satisfaction, underscoring the importance of time in building trust and alignment.
Strategic Success Stories:
- The Alaska regional board collaboratively decided to join a clinically integrated network (CIN), leveraging both clinical and administrative insights for a well-rounded decision.
- System-level boards influenced enterprise-wide technology investments and strategic priorities.
Organizational Alignment: Providence’s governance framework has strengthened alignment across regions, fostering a unified approach to strategic challenges like provider wellness and value-based care.

Conclusion

Providence Health’s structured medical group governance demonstrates the power of collaboration between physicians and administrators. By creating a governance framework rooted in inclusivity, clarity, and empowered decision-making, Providence has positioned itself to address healthcare’s evolving challenges while restoring the joy of practicing medicine. This case underscores the value of thoughtful governance in driving organizational integration and improving care delivery.

[1] https://www.physiciansadvocacyinstitute.org/PAI-Research/Physician-Employment-Trends-Specialty-Edition-2019-2021?utm_source=chatgpt.com

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A healthcare governance company