We have written for years about the transition in health care from volume-based to value-based payment models. But the process has been a slow one. According to the Deloitte 2016 Survey of US Physicians, a nationally representative sample of 600 US primary care and specialty physicians, confirms the slow pace of adoption of value-based payment models among physicians. Generally, physicians are reluctant to bear financial risk for care delivery. Yet many physicians conceptually endorse some of the principles behind value-based care, such as quality and resource utilization measurement. The survey results suggest that financial incentives have not changed and tools to support value-based care vary in maturity and availability.
Since 2011, the Deloitte Center for Health Solutions has surveyed a nationally representative sample of US physicians on their attitudes and perceptions about the current market trends impacting medicine and predictions about the future state of the practice of medicine. The general aim of the survey is to understand physician adoption and perception of key market trends of interest to the health plan, health care provider, life sciences, and government sectors. The 2016 survey included 600 US primary care and specialty physicians and had new questions on MACRA. The national sample is representative of the American Medical Association (AMA) Masterfile with respect to years in practice, gender, geography, practice type, and specialty, so as to reflect the national distribution of US physicians. The AMA is the major association for US physicians and its Masterfile is a census of all US physicians (not just AMA members). The database contains records of more than 1.4 million US physicians and is based upon graduating medical school and specialty certification records.
The Deloitte survey suggests organizations should seek to tie physician compensation to performance, equip physicians with the tools to meet performance goals, and investment in technology capabilities to connect and integrate the tools. First, notably, the study found that value-based payments make up a small proportion of physician compensation, similar to its 2014 findings. A majority of physicians (more than 8 in 10) still report being compensated under fee-for-service (FFS) or salary. While physician participation in value-based payment models is increasing (30 percent in 2016 versus 25 percent in 2014), few physicians participate in models that have the greatest downside risk (10 percent in capitation and 4 percent in shared-risk arrangements).
Even for organizations participating in CMS pilots, such as accountable care organizations (ACOs), a study revealed that the structure of physician compensation was similar to that in organizations that were not part of an ACO. The study found that physicians in ACOs and those not in ACOs earned 49 percent of their compensation from salary, 46 percent from productivity (volume), and only about 5 percent from quality and other factors.Not only are value-based sources of payments an uncommon source of physician compensation, but the proportion of compensation tied to performance, such as better quality or lower cost, is also small.
One-half of physicians in the survey reported performance bonuses less than or equal to 10 percent of their compensation, and one-third reported that they were ineligible for performance bonuses. These numbers are well below the threshold (20 percent of total compensation) that the literature suggests would be effective in incentivizing physicians and producing behavior change. Interestingly, physicians reported that they would be willing to accept sizeable proportions of compensation at risk, if required to. The median reported proportion is 15 percent, meaning one-half of surveyed physicians would put more than 15 percent of compensations at risk and the other half would accept less than 15 percent.
Some more attractive value-based arrangements
Most physicians reported that they prefer FFS and/or salary. As in 2014, few physicians preferred value-based payment models that carry significant financial risk (such as capitation and shared risk). However, compared to 2014, more physicians preferred models that include some upside risk component, such as shared-savings models.
- 85 percent of physicians said they would need additional resources to comply with Medicare required quality reporting at their practices;
- 74 percent said that collecting and reporting the information for these quality measures is burdensome;
- 83 percent did not feel that the measures accurately capture quality of care for their specialty.
Physicians with access to some types of advanced capabilities (for example, clinical protocols and/or care pattern information) were less likely to say they feel underprepared for quality reporting requirements such as those considered under MACRA. But even in this group, most say that quality reporting is burdensome. For instance, 72 percent of physicians with access to clinical protocols versus 82 percent of those without described quality reporting as burdensome, and 84 percent versus 87 percent said they would need additional resources to comply with reporting requirements.
When asked about improvements to care pattern reports, physicians cited that they would like the data to be adjusted for patient complexity or severity (60 percent), to be trustworthy and consistent with their experience (51 percent), and to have a stronger focus on outcomes instead of processes (36 percent). Some of the desired features had more to do with the delivery and usability of care pattern reports than with their actual content.
Physicians report low use of cost and quality data in informing patient referrals
For organizations building value-based care capabilities, understanding physician referral behaviors and patterns of referrals can be a way to find savings or improve outcomes. One study found that, in cases where treatment guidelines were unclear, physicians in high-spending regions were much more likely to choose intensive clinical approaches than physicians in low-spending areas, and a number of those approaches involved referrals (for example, referrals to specialists for one-time consultations or for ongoing management, to tests and diagnostic procedures, to hospitals or intensive care units).
There is also high variation in health care prices that is unrelated to quality; this variation exists even within the same markets, where the prices for the same procedure can vary by a factor of three or four. Surveyed physicians cited trust or working relationship (75 percent) and specialized expertise (69 percent) as the top two criteria in patient referrals. Other studies also show that physicians value clinical expertise. Consistent with the literature, patient access considerations (51 percent) are also prominent in referral decisions. This is especially true among primary care (58 percent) and nonsurgical specialists (60 percent).
The survey results suggest data-driven and evidence driven referral patterns are uncommon: Only 15 percent of physicians said they take into account outcomes or quality ratings when they make referrals. Cost considerations were also infrequent, as 15 percent of physicians considered patient co-pays and insurance in-network status and only 1 percent
Understanding physicians’ willingness to participate in value-based payment models
To better understand the factors most likely to contribute to physicians’ participation in value- based payment models, the study built a regression model that used a combination of demographics, practice-setting characteristics, and measures of tools and resource availability. It found that, with regard to their willingness to adopt value-based payment models, physicians can be classified in three broad segments:
- With appropriate incentives, these physicians were likely to participate in value-based payment models. Many already had experience with—and the tools for—value-based care and performance-based compensation models.
- On the fence. These physicians were more cautious about value-based payment models. They had less experience with them, and fewer supporting tools.
- Resistant physicians were skeptical about value-based care and unlikely to participate in these models, even with incentives.
Willingness to participate in value-based payment models was higher among younger physicians and those who were employed by or affiliated with a health system. Older physicians and those in independently owned practices, especially in solo practices, were more likely to be resistant to value-based payment models. Those who had a high Medicare Advantage payer mix, practiced in the west, and/or were surgical specialists were more willing to participate in value-based care.
The analysis also revealed large differences among segments in attitudes, experience with performance-based compensation, and risk tolerance. For instance, 36 percent of physicians in the willing segment already receive some compensation from a value-based source of payment versus 24 percent of physicians who are on the fence and 21 percent of resistant respondents.
The demographic and practice setting differences between the segments have particular implications for value-based care efforts. For instance, solo practitioners and those in small practices might be more difficult to engage effectively as they tend to be more resource-constrained, both in terms of staffing and technology availability. Interestingly, the analysis shows that the availability of tools and resources helps mitigate the effects of non-modifiable demographic characteristics. For instance, when physicians have care pattern information, clinical protocols, and Stage 3 Meaningful Use EHRs, their willingness to participate in value-based care increases. Making these tools available could help move physicians from the on the fence to the willing category.