Future Directions for Academic Practice Plans: Thoughts on Organization and Management from Johns Hopkins University and the University of Pennsylvania

Academic practice plans have been challenged in recent years by increasing pressures for productivity and financial performance. Most practice plans began as relatively loose affiliations among the clinical departments associated with their respective medical schools, and such approaches were adequate in an earlier era. However, this model is not well suited to deal with the current and future challenges that face the practice plans, hospitals, and medical schools that comprise our academic medical centers. The current clinical, financial, and regulatory environment requires highly effective business management, a shared commitment to common goals, and meticulous attention to regulatory compliance. In turn, the organizational structures, daily management, and overall governance of academic practice plans must be revised to address these new expectations. The business, clinical, and academic performance of the individual practices must be aligned to meet the diverse, and sometimes conflicting, needs of the academic health center. Both Johns Hopkins Medicine and the University of Pennsylvania (Penn Medicine) have been addressing these issues independently, but their approaches share many common principles. Among others, these principles include (a) organizational alignment, (b) strong practice plan business management, (c) shared resources and strategies, (d) accountability for performance in each practice based on credible data generated by the practice plan, (e) uniform audit and compliance standards, and (f) application of market strategy principles to assure the right mix of primary and specialist physicians, and appropriate incentive-based compensation for physicians. The application of these approaches at two academic health centers, and the rationale for these approaches, are discussed in detail.