The system's roots trace back to 1973, when President Richard Nixon signed into law the Health Maintenance Organization Act, which provided government support in the form of loans and grants to build or expand HMOs. A small group of Grand Junction physicians decided to start their own HMO and signed up John Harrison, who had recently obtained a master's degree in health administration from the University of Colorado Health Sciences Center, to be plan administrator. Harrison took care of the business side while the doctors set up the network. Harrison says it was possible because the doctors had existing relationships and a mentality typical for people in the West at that time.

“To keep the government off their back, they wanted to show that physicians could be responsible,” Harrison says.

“The physicians did it themselves. For the most part, these guys knew each other professionally and socially and they all lived in Mesa County. It was the biggest industry on the Western Slope—the medical industry. There were an awful lot of informal negotiations because they all knew each other and they all wanted to prove they could do it on their own.”

Doctors in Grand Junction and Mesa County essentially built a managed care system where the plan provider they created—now known as Rocky Mountain Health Plans—coordinated and collaborated on health care with a newly created Mesa County Physicians Independent Practice Association. Over the years, the partnership has developed several distinct methods to increase quality and decrease cost.

Working together

A key facet of the model is called the “withhold.” Rocky Mountain Health Plans withholds 20 percent from every doctor's bill it receives and places the money into a pool. Since doctors agree to take less to treat patients with private insurance, there's less reluctance to treat patients on Medicare and Medicaid.

That means doctors in Mesa County and Grand Junction treat plenty of patients on government healthcare programs without having to make up for lost revenue from private insurers.

“Having that kind of global risk across lines of business allows for more financial capability to see Medicaid members, as opposed to models where Medicaid is a sole payer and it's not always been financially possible to have a lot of Medicaid members,” says Dr. Greg Reicks, president of the Rocky Mountain Physicians Independent Practice Association.

But the withhold also serves another function. At the end of the year, Rocky Mountain Health Plans divvies up the pool and distributes it to doctors in the form of a bonus. How much of a bonus doctors receive depends on how efficiently they deliver care. For example, if one doctor orders 10 times the amount of MRIs than normal for the area, that doctor will receive less of the year-end bonus.

That efficiency of care is measured by the MCPIPA through a peer review process. The association also shares data with its members on community norms, generic prescriptions and best practices for tests, treatments and procedures. Unlike some other peer review boards, the Grand Junction model allows doctors to confer with fellow physicians in their own community.

“The medical directors will conduct an office record review, so the physician will have another physician come in and go over how he practices medicine,” says Steve ErkenBrack, president and CEO of Rocky Mountain Health Plans. “If the practice raises certain issues—good or bad—that will be brought to the medical practice review committee. It's a best-practices sort of review.”

The association, which currently has approximately 300 members, also oversees several committees that help oversee care. 

According to the association's website, the Medical Practice Review Committee is “responsible for the review and evaluation of the quality of medical or other health care services and the utilization of medical or other health care services in conjunction with any health plan for which the IPA has agreed to provide the services of physicians and other health care professionals.” The Physician Incentive and Engagement Committee has a responsibility “to design, facilitate and monitor programs relating to payments to members under the terms of incentive plans.” The Quality Value and Outcomes Committee, among other things, develops “clinical quality and utilization review programs and monitor the outcomes of such programs, set overall utilization review and management priorities, design clinical care guidelines and provide ongoing oversight, review and modification of such guidelines and, as appropriate, generate general financial and analytical reports regarding utilization of medical service, based on historical claim data, for the purpose of measuring historical claims data, for the purpose of measuring results of, or necessity for, utilization programs or guidelines.”

Another way the system helps manage healthcare is through primary care physicians, who essentially serve as the gateway to the system. The use of primary care physicians is so extensive that people in Grand Junction and Mesa County outpace the national average for utilizing primary care physicians.

“Primary care is critical. We use a lot of nursing coordination, and more than 10 percent of our employees are nurses at Rocky to keep a patient-focused approach to care,” ErkenBrack says. “We've had a program for many years—we will have a nurse call the patient just to make sure they understood their discharge instructions. We discovered a lot of patients that didn't realize they had discharge instructions, so as a result, we have fewer re-admits. We've done a lot of things like that in the community.”

Health care professionals in Mesa County also use an electronic system for medical records. The system allows doctors easy access to a patient's medical history, which in turn makes it easier for them provide efficient care. “We decided several years ago that we wanted to get into health information exchange,” Reicks says.

Reicks says Mesa County's medical records system has a data exchange and a data repository. The exchange allows labs, hospitals and doctor's offices to share medical records as a patient moves through the system, say from a general practitioner to a testing facility to a specialist. The repository serves as an archive of a patient's medical history that doctors can access without having to rely on a patient's memory. The repository, Reicks says, helps eliminate redundant tests or procedures.

In terms of the area's hospitals, Rocky Mountain Health Plans negotiates fees while the physician's association provides its members with data about hospital charges. And the administrators and doctors in Grand Junction and Mesa County were at the forefront of offering pre-natal care, palliative care and end-of-life care.

Weathering storms

Over the years, it hasn't exactly been easy. Some physicians, even in Grand Junction, say the system rations health care or advocates costs savings over a patient's interests.

“I tell people it's been very hard, and it's not always been collegial,” Reicks says. “We've had multiple points in the IPA where it's come to disillusion. We have some specialists who don't like the model and don't participate.”

But Reicks says the primary element those involved focus on is that there's the potential to make everyone's life easier, including the physician and the consumer.

“Lots of folks come away from this thinking it'd be great to live in Grand Junction and we all hold hands,” ErkenBrack says. “The reality is we fight about it. But it's OK to fight about it; it's good to fight about it, because we're trying to resolve our differences. The problem with health care is when you withdraw into your silo.”