Study Analyzes Truth of IDN Claims of High-Quality, Low-Cost Care

Despite large claims that integrated delivery networks (IDNs) delivery higher quality care more efficiently and cost-effectively, a study of the nation’s 15 largest IDNs provided scant evidence to back them up, according to a new report from the National Academy of Social Insurance.

The researchers came to their conclusion with a comprehensive review of academic literature from the last 30 years of IDN development and analysis of publicly available quality and financial information from the largest IDNs, including Intermountain Healthcare, North Shore-LIJ Health System, and Geisinger Health System.

"Some of the nation’s finest hospitals and clinical staffs can be found in this fifteen IDN sample Jeff Goldsmith, the study’s lead author, president of Health Futures, Inc, and associate professor of public health sciences at the University of Virginia, said in a statement. “This analysis was not intended to denigrate these fine institutions or their management. Rather, it is intended to address whether the way they have organized care creates measureable benefits to society, or for that matter, to the institutions themselves.”

Based on the review of literature, the authors divided the supposed benefits of IDNs into 2 categories: benefits to society and benefits to IDNs themselves. As part of the former, the Mr Goldsmith and colleagues identified claims of providing better coordinated care leading to improve quality and lower costs from eliminating duplicative tests and reducing unnecessary care. The benefits to providers in IDNs include improved efficiency and enhanced market competitiveness and bargaining power.

However, the authors found little actual evidence that integrating hospital and physician care improves quality or reduces costs. In fact, growing costs have been witnessed.

The investigators found comparing IDN performance with industry norms impossible and that gaps in disclosures significantly hampered a detailed evaluation of IDN performance. In only 5 of the 15 IDNs was it possible to determine the percentage of revenues generated by an IDN’s hospitals and for none of the IDNs studied was it possible to determine their hospitals’ contribution to operating profit.

“If public policy is to continue fostering IDN growth and development, a more solid evidentiary foundation for this form of medical care organization seems essential,” the authors concluded. “The mere presumption of societal benefits of IDN formation or operation is no longer tenable as a policy principle.”