Independent Physician Associations (IPAs)

Definition

An independent physician association (IPA) is a business entity organized and owned by a network of independent physician practices to reduce overhead or pursue business ventures such as contracts with employers, accountable care organizations (ACOs) and/or managed care organizations (MCOs). There are substantial opportunities for innovation in delivery system modeling and benefit design in collaboration with physician networks. Specifically, practice networks involving primary care leadership may accelerate essential and necessary changes in health care delivery.

Introduction

Physicians are exercising their market leverage through various contracting and affiliation strategies, which allow a group of physicians to speak with one voice, including IPAs. Such strategies also enhance physicians’ access to the capital and management resources necessary to pursue cooperative business ventures such as managed care contracts and direct health care services contracts with employers.

Purchasers of health care services are more likely to enter into contracts with larger groups of physicians who can provide comprehensive services, within a specialty or in a specific geographic area, demonstrate high-quality outcomes, assume risk and provide unique, innovative or collaborative health care services. These services include comprehensive care of chronic medical conditions that benefit from collaboration among multiple entities, such as specialty practices, imaging centers, home health agencies and hospital systems working as a network. Enhanced functioning IPAs can offer many potential benefits to family physicians, including:

• Appropriate alignment of physicians’ financial incentives
• Efficiencies in practice administration and management
• Political influence within the medical and wider provider community
• Peer support
• Optimized facilities
• Enhances ability to negotiate favorable contracts with other entities such as MCOs, ACOs, radiology, laboratory and hospital systems
• Autonomy and local financial and care management control in managed care
• Improved services, including expanded hours, urgent care, outreach services for prevention, telephone triage and follow-up expertise

Physicians considering the development of, or participation in, an IPA should be aware of the potential risks. This is especially true with the IPA accepts significant financial risk for healthcare expenditures.

Physicians contemplating the development of, or participation in, an IPA should consider the following guiding principles:

1. IPAs should prioritize high-quality, patient-centered care that produced optimal patient health outcomes.
2. Efficiency, effectiveness and the delivery of high-value care should be foundational to IPA operations. The financial benefits that result from high-value care should go to those who provide the care.
3. Family physicians should utilize their unique skills and expertise in care management, coordination of care between specialists and hospitals and in their focus on preventive health to create value.
4. Strong, collaborative relationships between primary care physicians, limited specialists and hospitals are critical to the coordinated care of patients, to the success of an IPA and the satisfaction of physician participants.
5. An IPA must demonstrate its value to obtain contracts with health plans for covered lives.
6. Physician autonomy and clinical accountability are essential to the success and integrity of an IPA.
7. The unique partnership embodied in the patient-physician relationship must be preserved.
8. Physician equity and shared governance must be thoughtfully structured to ensure appropriate control and autonomy and must be carefully considered by IPA physician participants.

(1998) (October 2025 COD)