Clinically Integrated Networks (“CINs”)
As our nation’s healthcare system continues its shift from volume-based to value-based compensation models, providers are increasingly accountable for producing quality outcomes at a lower cost. In order to achieve specific quality and cost objectives, many providers are seeking legally permissible integration options, such as Clinically Integrated Networks (commonly referred to as “CINs”). CINs enable independent providers representing a variety of specialties to collaborate in developing policies and protocols for the delivery of efficient, evidence-based, coordinated care. Participating providers must commit to the CIN’s primary objectives, including the establishment of specific clinical benchmarks and goals, and a data-driven, performance-monitoring system that will enable the CIN to demonstrate value.
Often, the collaborators in a CIN are technically marketplace competitors, so careful attention must be paid to reduce the risk of antitrust concerns, such as the allegation of an unlawful price-fixing arrangement. Historically, the Federal Trade Commission, Department of Justice, and/or State Attorneys General have challenged provider network ventures that did not satisfy specific structural and operational elements. The antitrust risk of a CIN depends largely on the concrete, demonstrable value that the CIN brings to the market and its relationship with payors. Providers cannot loosely or informally integrate in a CIN simply for the benefit of jointly negotiating better reimbursements; in fact, they must sufficiently integrate at the clinical level and demonstrate value before the CIN can engage in joint contract negotiations with third party payors. Any such negotiation must be ancillary to the CIN’s primary objectives of improving clinical outcomes, eliminating inefficiencies, managing utilization, and lowering costs through collaboration with other providers. Frier Levitt regularly counsels clients regarding the antitrust implications of business arrangements in both the healthcare and life sciences spaces.
CINs can be powerful vehicles for providers seeking to thrive in a value-based healthcare climate, but the formation and implementation of a successful CIN is a significant undertaking that requires diligent planning and careful consideration of legal, organizational, and financial issues. If you are interested in forming a Clinically Integrated Network, contact Frier Levitt today.