CHIPS: a health care system for the future

The Comprehensive Health/Integrated Provider System (CHIPS) is a vertically integrated care delivery model that enables hospitals to maintain or increase market share by sponsoring the widest possible range of health-related services. These include long-term care, dental care, fitness promotion, sleep disturbance therapy--virtually any service that can be incorporated in a system of providers. The CHIPS model can be modified to focus on a specific segment of the population rather than attempting to serve as many people as possible. This focus could be based on geographic considerations or on some demographic or health characteristic of the targeted population segment. Three basic strategies are available for choosing CHIPS locations. Providers can be consolidated in a single campus, or a loose network of services can be scattered throughout the area. Midway between these two strategies is the satellite approach, whereby CHIPS providers offer their services shopping center-style in one or more locations; this approach could be used either in addition to or instead of the campus strategy. A CHIPS may establish financial links with its patients through such insurance models as prepaid group practices or health maintenance organizations based on independent practice associations. Such links can provide significant price advantages on insured items sold to patients without exposing the hospital to antitrust liability. Other advantages of a CHIPS are that it can build patient loyalty (its chief purpose) and strengthen ties with the medical staff.