C432 Ch 5 Strategic Alliances Notes.docx

Noneconomic efforts help market physicians practices

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Noneconomic efforts help market physicians' practices, manage medical offices, and create physician liaisons and leadership development programs. Economic efforts include physician recruitment, creation of compensation models, lease management, development of service lines, equity joint efforts, and cash management. Clinical integration —generally considered the most difficult to achieve—addresses practice profiling and modification, disease management, quality improvement programs, and clinical information systems . 3
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Types of Alliances Alliances can be categorized by the degree of control and equity members have in the arrangement . Types of Strategic Alliance by Degree of Control: Strategic alliances and participants' relationships change over time. As alliances mature, their purpose and value may change. Alliances moreover can be distinguished by the type of resources members bring together. In some alliances, members pool similar resources, while in others, members contribute distinct complementary resources. Three types of alliances discussed in this chapter: the pooled-service alliance, the joint-venture alliance, and the network outsource alliance . A pooled-service alliance combines resources from a relatively large number of members. The alliance leverages the resources to benefit its members. Member organizations often contract with the alliance for services. Again, GPOs, which combine members' purchase volumes to engender greater price concessions from suppliers, are an example of a pooled-service alliance . 4
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Pooled-Service Alliance Function: Alliance pools and leverages resources to return value to its members. Example: GPOs negotiate prices for supplies and equipment for their large memberships. A joint-venture alliance is similar to a pooled-service alliance in that participants pool resources but differs in that it generally has fewer members, and members have a direct ownership position and greater directional authority. Many medical services organizations were created as joint ventures between a hospital and its associated medical staffs. All parties contribute capital and jointly hold equity in a company that can furnish needed administrative services to its members .
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