Fairview Foundation in Minneapolis created and evaluated Fairview Partners, an integrated health network of providers working together to improve the quality and delivery of health services to chronically ill nursing home patients.

This project sought to restructure the system of financing care, inter-organizational relationships and the system of care delivery. All providers participated in a capitated, risk-based financing system, sharing clinical and financial responsibility for patient care throughout the continuum of primary, acute and long-term care.

The project was part of the Robert Wood Johnson Foundation (RWJF) Building Health Systems for People with Chronic Illnesses national program.

Key Results:

• The project established the contractual mechanisms by which Fairview Partners operates. In 1998, the partnership earned $1.4 million from Medicare, providing the corresponding medical services at internal costs that left it with a surplus of approximately $500,000, which was shared among partners.
• As of 1998, Fairview Partners had enrolled 330 individuals in 11 participating nursing homes; it had an active enrollment of 203 individuals at the end of the grant period.
• Fairview Partners developed a proactive primary care program—centered around geriatric nurse practitioners who work collaboratively with 14 physicians with geriatric expertise—as the basis for its care delivery system. It emphasizes providing services in the nursing home setting whenever clinically appropriate.
• Fairview Partners created a risk pool so that all providers, including the nursing homes, share the total financial and operational risk for delivering care to project enrollees.

Key Findings: An external evaluation conducted by the Center for Urban and Regional Affairs found:

• The control group was hospitalized 2.4 times more often than the Fairview Partners group and averaged a total of 2.5 times more hospital days.
• Residents enrolled in Fairview Partners were more likely to remain in nursing homes, rather than return to their own homes, compared to a control group of non-enrolled nursing home residents.

The evaluation concluded that Fairview Partners was clinically advantageous and cost-effective.

Afterward: Fairview Partners is now self-supporting and profitable. As of 2002, it had increased the number of participating nursing homes to 21.