The importance of strong physician engagement is far from new, but hospital and health system CEOs recently elevated it to the most promising means of improving performance, according to The Advisory Board Company's Annual Health Care CEO survey.
This year, hospital and health system CEOs were twice as likely to rate physician engagement as their best opportunity to improve performance compared with other options — such as redesigning service portfolios for population health, strengthening primary care physician alignment and controlling avoidable utilization, among others — with 90 percent of respondents reporting an interest in physician engagement. Last year, survey respondents ranked physician engagement as the third-best opportunity to improve performance.
Engaged physicians approach their work with energy and enthusiasm, are dedicated to their patients and truly committed to the improvement of their organizations. In contrast, disengagement among physicians can pose a serious impediment to achieving an organization's goals.
Why physician engagement is critical now more than ever
Stephen Moore, MD, who was recently appointed CMO of Houston-based CHI St. Luke's Health, says numerous external demands have forced physicians' and administrators' relationships to evolve to understand physician engagement as a top priority.
Historically, the focus has always been less on physician engagement and more on physician satisfaction, according to Dr. Moore. Giving physicians what they 
wanted — such as access to the operating room and a supportive nursing staff — is what drove good business. Now, however, there is an opportunity through physician engagement — whether with employed or independent physicians — to improve patient access, customer service, quality and costs.
"Today the business model is shifting to a payment for value as well as value-based contracting with commercial payers," says Dr. Moore. "This change has really forced healthcare to unify operational and clinical leadership."
Establishing a highly engaged physician population allows hospitals to more effectively target the quality and efficiency issues that may help reduce complications, mortality, readmissions and length of stay. It allows the whole hospital business to come together as a team and tackle inefficiencies while addressing the needs of the community and making the patient experience more satisfactory, according to Dr. Moore.
Rob Lazerow, practice manager for The Advisory Board Company, says hospitals that fail to prioritize physician engagement will be left in the dust.
"Physician engagement is critical now because hospitals and health systems are in the midst of pretty major transformation," says Mr. Lazerow. "They are changing payment models, moving toward population health and providing more affordable care. Hospitals cannot achieve any of this without strong participation from their medical staff."
Hospital administrators have always focused on how they engage physicians, but the difference in 2015 is that the stakes are much higher, according to Mr. Lazerow. While improving care delivery and quality is an everlasting goal in healthcare, the risks of getting it wrong and the importance of getting it right are higher than ever before, as clinical outcomes and financial performance become bound more closely together.
Positive effects of enhanced physician engagement
There are numerous benefits of having a highly engaged physician workforce in addition to improved quality, lower costs and better performance overall.
An organization's culture is profoundly affected by increasing engagement among physicians and other clinical staff, according to Dr. Moore. Dyad and triad leadership models — in which physicians, nursing staff and executives work together on some level of management — create a trickle-down effect through the rest of the organization, because each group contributes its perspective of the business and can more efficiently solve issues. Additionally, the act of bringing physician and nurse leaders to the table with executives helps flatten the traditional health system hierarchy in which physicians serve as the clinical captains but are not really integrated with broader leadership.
Physician engagement also fosters a sense of connectedness, value and influence among physicians, which is beneficial to any hospital.
"In the past, one could classify even the best of situations as having tension between physicians and administrators," says Dr. Moore. "A highly engaged physician workforce chews away at the edges of that tension. It renews a sense of purpose for waking up and going to work."
Traditional hospital culture poses an obstacle
Effectively engaging physicians requires a restructuring in the way various components in healthcare organizations communicate and interact. According to Dr. Moore, until recently, healthcare functioned in a tri-partite parallel structure, in which the administrative leaders, physician leaders and other clinical leaders operated in distinct silos with little coordination and collaboration bridging them together. The recent push for increasing value, lowering costs and improving population health management is driving those parallel silos together, and the systems that most effectively align the interests of all three will be most successful.
Changing the structure and culture required to enable physician engagement does not happen overnight. While there hasn't been any resistance to the concept of improved engagement, Dr. Moore explains the difficulties lie more heavily on how exactly to achieve it.
"We are almost completely changing a business model that has been present for the last 100 years," he says.
There are cultural obstacles to overcome when making a systemic change within an organization, such as integrating physician leadership into operations. This is often equally uncharted water for both physicians and administrators, according to Dr. Moore. While everyone sees a need to go there, the process of overcoming the historical working relationship in which administrators wielded majority control requires a concerted effort as well as openness to learning and flexibility.
Best practices for physician engagement efforts
There are several important aspects of successful strategies designed to achieve this alignment and engage physicians.
- Implementing effective incentives. According to Mr. Lazerow, whether approaching an employee model or not, incentives are an important lever for motivating the right behavior and removing the barriers to higher performance. Compensation models are increasingly important as private practices consolidate with larger health systems and physicians seek hospital employment.
- Applying the right compensation models. Incentives based on productivity conflict with value-based care and population health management efforts, according to Mr. Lazerow. Instead, determining compensation models that promote highly efficient, population health-oriented care will reduce barriers to care transformation and may lead to improved engagement among physicians.
- Shifting the focus from contractual to cultural alignment. Another important aspect of enhancing physician engagement is shifting the focus from contractual alignment to cultural alignment, which includes focusing on leadership, joint decision-making and aligning strategy between physicians and administrators. However, contractual alignment is still vital for supporting the structures that create a unified care model, Mr. Lazerow notes. For example, he explains that models such as clinical integration can provide a vehicle for bringing together employed and private practice physicians.
- Developing strong physician leaders. Effectively integrating the clinical and administrative components of physician engagement calls for strong physician leadership and participation in governance roles. According to Dr. Moore, an essential part of this is identifying leadership opportunities and offering formal leadership development programs for physicians.
"The idea is to grow a coterie of physicians interested in becoming leaders in their specialties or across the medical staff, as well as involving physicians in operations of the organization, including decisions for purchases and allocation, developing care models and working with administrative leaders to create the quality and efficiency solutions the organization needs," says Dr. Moore.
- Improving transparency. Finally, improving performance transparency provides physicians with the means to analyze data on a case-by-case basis and provide better care in the future.
Supplementing physician engagement efforts with technological tools
Dan Malloy, PhD, executive vice president at Quantia, says the key driver of physician engagement is incorporating physicians' input into operational agendas instead of merely imposing new strategies over which physicians have no say.
A large majority of hospital administrators have very limited experience in managing physicians as employees, according to Dr. Malloy. If administrators' 
understanding of what physicians need to be effective is lacking and they have not created the communication mechanisms to hear physicians' opinions on how they want to be managed, the process of improving engagement could hit a roadblock.
New technology, such as content sources physicians respect, can help support communication between physicians and administrators.
For example, Quantia operates a web-based property called Quantia MD — an online physician community with 225,000 physician members who use it as a location for self-directed learning and collaboration with peers and colleagues across the industry. Health systems can leverage the platform as a vehicle to facilitate interaction, communication and engagement with their physicians to align their strategic business needs.
"In building physician engagement programs and strategies, you are talking about people who are fundamentally time-starved," says Dr. Malloy. "The design of such programs must leverage exchanges of information and dialogue in a concise and efficient way — the way physicians want to interact with and use information."
The Advisory Board Company offers its own tool for engaging physicians in cost and quality improvements. More than 1,000 organizations participate in The Advisory Board Company's Crimson Clinical Advantage suite of programs that align the efforts of physicians and health systems to deliver higher quality, more cost-effective care to the patients they serve.
The Advisory Board Company develops the Crimson Clinical Advantage's suite of offerings in partnership with a growing team of progressive health systems, hospitals and physicians. It helps health systems succeed under value-based reimbursement models by combining business intelligence technology with analytics support grounded in best practice research. Among other benefits, member organizations gain a nuanced view into physician practice patterns and payer-specific clinical and financial performance.
The Studer Group offers another variation of a physician engagement resource for hospitals and health systems. Through the Studer Group's Physician Coaching Partnership program, the Studer Group works with organizations to help them achieve alignment with physicians to drive accountability and further develop physician skills to improve patient outcomes. The Physician Coaching Partnership program begins with an initial survey and needs assessment, and is followed up with a comprehensive physician coaching plan and strategy.
The process of creating a strong physician workforce is a long and challenging one, but patients, payers and financial demands necessitate it. Most importantly, physicians wield the clinical expertise that can inform strategies, improve workflow and lead to better outcomes for patients, in turn improving the hospital's performance.