by John Cherf, MD, MPH, MBA
Traditionally, health system value analysis programs—tasked with evaluating new products to reduce unnecessary spending—have lacked direct participation from practicing physicians. However, as value-based care continues to take hold and hospitals face ever-growing pressure to cut costs while improving quality, the time has come for physicians to recognize the broader role we can play in the value analysis process.
The bottom line is simple: Value-based care cannot succeed without physician buy-in. After all, studies demonstrate that doctors are responsible for over 80% of the cost and quality decisions that impact patient outcomes. However, a large number of physicians have yet to realize the significant power they wield in this respect, and many of my colleagues remain unconvinced about the long-term impact and effectiveness of value analysis.
The reason for this disconnect are manifold. Physicians are rarely required to relinquish authority and are accustomed to working as individual practitioners or in small teams with a focus on the treatment and progress of each patient. They worry that value-based initiatives ignore the nuances of patient care and emphasize population-level data at the expense of individual outcomes. At the same time, health systems looking to engage physicians have often been slow to outline a common purpose, develop plans to communicate relevant data, and recognize constraints on doctors’ time or the impact of physician compliance fatigue.
My message to physicians is simple: Value-based care is here and the opportunity it provides us is tremendous. Medical practitioners are uniquely positioned to make sure that institutional decisions best reflect the needs of the patient. The basic question we all need to ask ourselves is this: At the end of the day, do I want to be a high-cost provider or a low-cost provider? Assuming your answer is the latter, how can you best lead the charge? Below are three recommendations:
- Get Smart About Costs
It is no longer feasible for physicians to be left in the dark about cost. Let’s look at the math: on average, drugs and medical devices represent up to 30% of a health system’s total spend, and 85% of medical devices have significant commoditization within a clinical category. At the same time, physician preference items constitute up to 60% of a hospital’s total supply costs. The only way to address this issue is through direct physician involvement. I’ve written previously about the need for orthopedic surgeons to be good stewards of technology, and the question I recommended we ask ourselves applies more broadly: “Do the clinical outcomes justify the price and switching-costs of adopting a new technology?” A stronger understanding of cost will allow you to make a more compelling case for introducing new technologies you truly believe in.
- Look for Opportunities to Lead
Physician-value engagement is most effective when there is a physician champion at the forefront who sees the big picture and is passionate about making a difference. Many administrators assume that physician champions should be executives, high-volume producers or senior faculty members; however, this old-school attitude is extremely limiting. Physicians possess unique knowledge about disease processes and device indication. Often, the best physician champions come from an underutilized group of early adopters who welcome new technology—if not outright change—in the traditional practice of medicine.
- Be Vocal About Your Needs
Every physician I know values efficient time management. As you participate in value analysis initiatives, make sure that administrators are tapping into your unique expertise and not involving you unnecessarily. Equally important, you must be explicit about your data needs. I’ve seen firsthand that the manner and type of cost and evidence-based data that hospitals share with physicians varies dramatically. Many administrators simply do not know where to start or have not been trained to effectively communicate data. By communicating your needs and asking the right questions early, you can stave off later frustration and misalignment. High performing value analysis teams will welcome your input and direction.
Geisinger Health provides a powerful example of effective physician engagement in value analysis. At Geisinger, physicians are involved at every stage of the process, including sitting on decision-making committees and always submitting their own requests for new products. In exchange, supply chain took several steps to make it easier for physicians to be engaged, including training so that clinicians understood how their involvement would help ensure a focus on patient care, not just price. As Geisinger Chief Physician Officer Dr. Michael Suk told us, “It was very surprising to see how many physicians actually enjoy understanding price and process and how it affects what’s going on in their world.” Read more about Geisinger’s success.
I’m excited by the opportunity that value-based care provides physicians to decrease variation, eliminate waste and optimize the value of care we provide our patients. Taking an active role in value analysis is one more step toward practicing medicine in the most efficient and effective way possible.