Opportunities, Challenges of Value-Based Care Adoption

Kenneth L. Davis, MD, believes that keeping patients healthy and ultimately out of the hospital is the key to making healthcare more affordable. That is why he is leading one of the nation’s top health systems down the path of value-based care adoption.

Mount Sinai Health System has been at the forefront of the transition from fee-for-service care delivery to the value-based care model, and that strategy has been successful. After years of investment and implementation, the health system has realized lower inpatient admissions and readmissions among patients in value-based contracts. Total cost of care has also shrunk for a majority of the health system’s value-based contracts because of quality improvements.

However, as Mount Sinai Health System works to do away with fee-for-service, the healthcare industry at large is still holding on to the old way of delivering care.

“It’s much easier for physicians to do fee-for-service,” Davis admits, discussing Mount Sinai Health System’s own experience with shifting their primary care physicians to a value-based care model.

“You need to incentivize the doctors to cooperate with a value-based program instead of doing fee-for-service,” Davis explains.

Like many provider organizations, Mount Sinai Health System experienced some pushback from physicians. Many doctors in the health system were concerned about their bonus, which is a major provider compensation factor for most physicians. If they were expected to reduce utilization, then how could they expect to earn a bonus?