This article is an extract from Performance, Volume 7, Issue 2, May 2015. The full journal is available at
ey.com/performance
Integrated medical
management: setting
a clear strategy and
driving results
The goal of “medical
management,” an emerging
discipline within the health
care sector, is to integrate
the distinct processes of
case management, disease
management and utilization
management, thereby achieving
better clinical outcomes and
reduced costs. We offer
insight into a disciplined,
structured approach that will
help give health care providers
a clear, integrated medical
management strategy, an
efficient operating model and
technology enablers that will
enable them to realize the full
benefit of their investments in
this new field.
44
Volume 7 │ Issue 2
This article is an extract from Performance, Volume 7, Issue 2, February 2015. The full journal is available at
ey.com/performance
Authors
Samuel Hughes
Principal, Strategy, EY, US
Katie Kramer
Senior Manager, Federal Health, EY, US
45
This article is an extract from Performance, Volume 7, Issue 2, May 2015. The full journal is available at
ey.com/performance
Integrated medical management: setting a clear strategy and driving results
Jumping into execution without a
clearly defined strategy risks suboptimized investments at best, and
an organizational rejection of the
concept at worst.
The core idea is
that this integrated
approach will position
the right health care
professional at the
right time with the
right treatment.
T
The term medical management
is not specifically and uniformly
defined in the health care
field, but generally, it refers
to the integration of three
specific disciplines — case
management, disease management and
utilization management — supported by
population health and referral management
activities (see Figure 1). The core idea is
that this integrated approach will position
the right health care professional at the
right time with the right treatment. Patient
satisfaction is also a key outcome, with the
goal being that they feel their time is better
utilized, their treatment is more effective
and their overall experience is more
positive.
The vision of a truly effective medical
management model is that tighter
integration of these disciplines — supported
by new processes, technology and
organizational roles — will improve overall
health care outcomes while also driving
down costs. The ability to simultaneously
provide better care and lower average cost
Figure 1. The activities and disciplines of medical management
46
Case
management
Disease
management
Utilization
management
nt
te
g
m
rat
ge
ed r
eferral mana
Volume 7 │ Issue 2
Case management is a collaborative
process that assesses, plans,
implements, coordinates, monitors and
evaluates options and services to meet
an individual’s health care needs.
Disease management is a system
of multidisciplinary efforts focused
on improving the quality and
cost-effectiveness of care associated
with chronic illness.
Medical
management
components
In
Integrated referral management is a model
for directing, monitoring and controlling
patient referrals with the aim of achieving
the most clinically driven and cost-effective
outcomes. It involves a streamlined process
and standard workflow to manage the life
cycle of patient referrals. Its goal is to
optimize the referral process, drive patient
accountability and minimize disruptions.
lth
on hea manage
lati
me
u
p
n
Po
t
Population health management helps assess
the continuum of care. It involves the
stratification of patients into risk groups and
the creation of care strategies based on each
group’s needs. Its goal is to reduce costs by
preventing illness, improving quality of life
and enhancing health outcomes for those
suffering from chronic conditions.
e
Utilization management is a
coordinated set of techniques focused
on balancing health care resources in
order to provide patients with the right
care at the right time.
This article is an extract from Performance, Volume 7, Issue 2, February 2015. The full journal is available at
ey.com/performance
Figure 2. The medical management approach
Population health management
Case management
Disease management
Utilization management
Integrated referral management
Strategy
Current state
Scope
Strategic
objectives
Initiatives
Outcome
metrics
What is our
space?
What is
our starting
point?
Where do we
or should
we play?
What do we
need to
accomplish?
How do we
get it done?
How do we
know if we are
successful?
Process
model
Organizational
structure
Technology
infrastructure
Operating
locations
Governance
structure
Performance
metrics and
accountability
How are we
organized?
What are our
organizational
roles, spans of
control and
reporting lines?
What are our
key technology
capabilities?
What is our
operating
infrastructure?
Who has
decision-making
authority?
How is
performance
defined and
measured?
Standard
operating
procedures
is enabled by processes, technology and
analytics. For example, predictive data
elements, combined with tighter patient
communications and scheduling, allows for
earlier interventions and better, cheaper
care. Intuitively, this approach makes sense
to patients, providers and administrators,
because high-quality, cost-effective health
care is dependent on patients interacting
with the right health care professionals at
the right times to treat the right issues.
But in today’s environment, it’s
widely understood that health care faces
extraordinary challenges, both external and
self-imposed, when it comes to attacking
problems in a holistic, integrated manner.
Responsibilities and competencies
A huge amount has been written on the
process, technology and organizational
issues that inhibit integrated health care
solutions — lack of standardized electronic
health records, distributed-provider care
models and unclear cost parameters are
just a few of these fundamental issues. It
is within these constraints that the medical
management discipline needs to operate,
creating unique challenges for health care
providers as they evolve and develop this
capability.
Recognizing the opportunity presented
by medical management, many health care
organizations have invested in disparate,
tactical solutions — such as redesigning
Performance and change management
Operating
model
Environment
Training and
education
clinical operations workflows, creating
new standard operating procedures or
implementing new training classes. These
tactical efforts are usually met with mixed
success. Too often, medical management
investments are not driven by a clear,
integrated strategy. As a result, to use a
medical analogy, it is the symptoms that are
being treated rather than the patient as a
whole. The remainder of this article outlines
a path forward for organizations that are
looking to embrace the full potential of
integrated medical management and ensure
the changes they make will stick.
47
This article is an extract from Performance, Volume 7, Issue 2, May 2015. The full journal is available at
ey.com/performance
Integrated medical management: setting a clear strategy and driving results
How Navy Medicine
implemented its Care
Management strategic
vision
To prioritize and implement strategic initiatives relative to
its Case Management Program, the Bureau of Medicine and
Surgery, Care Management Directorate proactively took
steps to develop a formal plan and road map to define the
program objectives and align the program direction with its
leadership’s focus for change priorities.
This effort culminated in a two-day strategic visioning
session in which key leaders, both internal and external
to Navy Medicine (e.g., Defense Health Agency (DHA) and
Veterans Affairs (VA)), came together to help define and
shape the program’s future state.
This strategic plan served as a critical component of
the program’s success, as it clearly defined the prioritized
initiatives and future-state outcomes.
It also served as a key change management enabler
by aligning leadership and stakeholders to the mission
and objectives, while also ensuring alliance from other
organizations going forward.
The importance of a strategic
approach
If medical management is to be a
core capability within complex health
care systems, it will require strategic
transformation of systems, processes,
data, organizational roles and performance
metrics. Given the scope of this change,
and the potential for material clinical and
financial benefits, organizations need to
approach this as a strategic management
problem that requires rigorous planning.
Jumping into execution without a clearly
defined strategy risks sub-optimized
investments at best, and an organizational
rejection of the concept at worst.
A tightly focused strategic plan is an
invaluable tool to get an organization
focused on delivering large-scale, medical
management change. Such planning
exercises have many forms but, at a
minimum, should include the following
components:
► Environment scan — what are other
health care providers doing in this
space? How are patient needs and
preferences changing?
► Current-state review — what is the
organization’s starting point and level
of maturity in key medical management
processes?
48
Volume 7 │ Issue 2
This article is an extract from Performance, Volume 7, Issue 2, February 2015. The full journal is available at
ey.com/performance
► Scope — where should the organization
focus efforts for change and, just as
importantly, what areas are out of
bounds?
► Objectives — what needs to be
accomplished, and how will the
organization operate or differ when the
objectives are achieved?
► Initiatives — how do we chunk up the
work into manageable projects and
when can they each be completed?
► Outcome metrics — how will we
quantitatively know if the organization
is successful?
1.
J. W. Ross, P. Weill and D. C. Robertson, “Define Your
Operating Model,” chapter 2 in Enterprise Architecture as
Strategy: Creating a Foundation for Business Execution,
(Harvard Business Review, 2006).
2.
Framework adapted from J. W. Ross, P. Weill and D. C.
Robertson, “Define Your Operating Model,” chapter 2 in
Enterprise Architecture as Strategy: Creating a Foundation
for Business Execution, (Harvard Business Review, 2006).
Coordination
Unification
• Operationally unique business units
• Shared customers, services or
• Globally integrated business
Process integration
suppliers drive the need for integrated
data standards across the organization
• Business unit control over process
design
Management company
processes, often with the support
of enterprise systems
• Shared customers, services or suppliers
• Standardized processes designed by
designated process owners
Operating company
Diversification
Replication
• Operationally unique business units
• Few shared customers or suppliers with
• Operationally similar business units
• Few shared customers
• Autonomous business unit leaders with
limited need for data standards across
the organization
• Business unit control over process
design and IT application decisions
Low
The complexity
and cost of a major
transformation —
combined with what
is often an unclear
organizational
vision regarding
the purpose, scope
and objectives
of medical
management —
require a disciplined
approach to
investment
priorities and
timing.
High
Figure 3. Operating model framework2
and IT services
Franchise company
Holding company
Low
limited discretion over process design
• Centralized control over process design
Process standardization
Defining the operating model
Once the strategy has been clearly
articulated, the next step is to define the
medical management operating model.
The term “operating model” is one that
can have very different meanings to
different people but, in this context,
the operating model should define the
operational infrastructure through which
the strategy will be executed. By specifying
the operating model, an organization is
committing to a way of doing business both
today and tomorrow, while also setting the
parameters for future people, process and
technology investments.
Many health care organizations still
do not formally design their operating
models, focusing their planning energy on
budgeting or strategic planning. However,
research indicates that organizations with
High
a foundational, clearly defined operating
model report significantly greater
performance across a range of outcome
metrics, including operational efficiency,
customer intimacy, product or service
leadership and strategic agility.1
In the context of medical management,
the end goal is an operating model with
highly standardized processes (e.g.,
executing clinical pathways with minimal
unwanted variation), but also highly
integrated processes (e.g., clear hand off
of patient data from one care delivery
team to another). This presents a huge
shift for many health care organizations
with distributed facilities that operate
with relatively low levels of process
standardization and integration. In effect,
many health care organizations are moving
from the “bottom left” to the “top right” of
the matrix shown in Figure 3.
49
This article is an extract from Performance, Volume 7, Issue 2, May 2015. The full journal is available at
ey.com/performance
Integrated medical management: setting a clear strategy and driving results
Reducing costs and
improving the customer
experience
At a prominent commercial integrated delivery system (IDS)
organization, health care was siloed, and the organization
wanted to simplify population management and improve the
customer experience while reducing operating costs.
By developing a new operational strategy, implementing
a system that allows one nurse to have a complete overview
of the patient, and designing and implementing data
analytics and reporting that provide insight into member
demographic trends, the organization was able to:
► Reduce operating costs by centralizing member care
delivery
► Improve patient care, since the primary nurse could now
see all aspects of it, from medical history and lab results
to prescriptions
► Enable the proactive identification of members at risk
of chronic illness (such as diabetes, asthma or smoking)
via the Population Health Management system, thus
allowing early enrollment in disease preventive wellness
programs
50
Volume 7 │ Issue 2
This article is an extract from Performance, Volume 7, Issue 2, February 2015. The full journal is available at
ey.com/performance
► Organizational structure — what new
roles are required and what are the
appropriate reporting lines?
Ultimately, medical management is
executed at the frontline of health care
delivery. As such, implementation requires
detailed standard operating procedures
(SOPs), roles and responsibilities, skill
profiles, and a robust training and education
program. Position descriptions will also be
required for new roles, which may be filled
from existing resources or new hires into
the organization.
► Governance — where will the decisionmaking authority reside for each
process within the organizational
structure?
Real change, measurable
results
Executing this shift requires a blueprint
for the operating model that describes how
the strategy will be implemented in the
following areas:
► Process model — how will processes be
aligned in support of patient outcomes?
► Technology architecture — what new
data, systems and interfaces will be
required to support the process model?
► Operating locations — what activities
will be performed and where, and
will any new locations or facilities be
required?
► Performance metrics — how will we
monitor the processes and then hold
people accountable for results?
Execution enables
implementation success
With a clearly defined medical management
strategy and operating model, investments
in operational capabilities can be built
within the context of the broader vision
and plan. This is because there is a greater
understanding of the medical management
architecture and the organizational “home”
for new capabilities. As a result, there is a
much greater chance of implementation
success, with strong return on investment.
When done correctly, an integrated medical
management model of clinical pathways
represents a breakthrough in how health
care organizations optimize the disciplines
of case management, disease management
and utilization management to drive
improved clinical outcomes, lower costs and
a better patient experience.
The vision of a truly
effective medical
management model is
that tighter integration
of these disciplines —
supported by new
processes, technology
and organizational
roles — will improve
overall health care
outcomes while also
driving down costs.
But health care providers should be
cautious about the “ready, fire, aim”
approach with major medical management
investments. The complexity and cost of a
major transformation — combined with what
is often an unclear organizational vision
regarding the purpose, scope and objectives
of medical management — require a
disciplined approach to investment
priorities and timing.
An integrated framework that clearly
defines the medical management strategy,
operating model and execution components
will set the foundation for real change with
measurable results. 
51