What Does It Mean to be “Physician-Led” (and is that a good thing)?

I’m inspired by provider organizations that are genuinely committed to healthcare transformation, but these days it’s easy to get confused. It seems the entire industry professes to be patient-focused, physician-led, purchaser-driven, high-performing, innovative, and transformational. If that’s the case, why is healthcare so ripe for disruption, and why it still so broken? This may seem like a complex question, but I think the answer is quite simple – for most healthcare organizations, it’s just safer, easier, and more financially beneficial to protect the status quo, and defer any real accountability. 

I admit it. I’m biased. I’m a big fan of physician-led organizations and have a long history working in this space. I helped develop a successful physician-owned HMO early in my career, and have since served as an executive in a physician-run hospital, a physician-led health system, and several physician-led integrated delivery networks. I also spent the bulk of my 10+ years on the payer side developing physician-centric strategies, because let’s face it, as vital as our hospitals are to our healthcare system, they are inherently conflicted when it comes to value-based success. It seems most would still rather “follow” so as to not “outpace” the market.

It also troubles me when I hear prominent healthcare organizations talk about their “value-based journey.” It’s not a journey, it’s a competency, and you either have it or you don’t. And if you don’t, then you’re either committed to transformation, or you’re not. And if you are, then don’t just talk about it. Make it an organizational priority, embed a strong commitment to “value” in your mission, reward your star performers, and execute to the best of your ability. 

Admittedly, I can be impatient at times, but I’ve also observed and encountered decades of resistance in healthcare. Too many baby steps, too many band-aids, a lot of optics, and very few solutions. It also doesn’t help that most of the value-based programs we see today are still largely based on FFS, and not designed with progressive providers in mind.  

So how do we finally move the needle, and are “physician-led” organizations our best hope? Perhaps, but it really depends…

-   If a hospital employs a physician as its CEO is that considered a “physician-led” organization?

-   If a health system enables (and essentially funds) the development of an ACO/CIN and makes a point of electing a physician as its Chair, is that a "physician-led” organization?

-   Does an independent IPA have a better chance of succeeding in value-based care by virtue of the fact that they are 100% physician governed? And what if a large percentage of the organization is comprised of hospital-employed physicians where there may be “expectations” with respect to referrals, etc.?

I have also encountered “physician-led” organizations that take it too far, with a history of sheltering their physician colleagues from industry realities (and performance transparency) for the sake of internal solidarity. Some of which still maintain they are culturally opposed to outcome-based financial incentives for their physicians. I know, this seems archaic, and it’s certainly not in the best interests of patients and other healthcare purchasers, but that’s the way it is in some healthcare systems, even those that pride themselves on being “physician-led.” This is an important distinction, and while I will continue to wholeheartedly support innovative physician-driven efforts to transform care delivery, being “physician-led” is simply not enough.

Whether you are hospital-led, physician-led, or an independent disruptor, you need to possess the right intentions, and have the culture to back it up. 

At the end of the day, it’s all about embracing what I believe are the 4 critical fundamentals of value-based care delivery:

1. A payment model that fosters genuine provider accountability
2. An operating model that empowers primary care and unencumbered access
3. A care coordination model that ensures effective navigation across the continuum, and
4. A provider compensation model that ensures appropriate incentives/rewards for high performers

It’s also important to note that accomplishing 1, 2, or 3 out of 4 will likely not yield much success. You really need to be able to check all 4 of the boxes. The components are intended to work together to promote cohesion. This is why most “integrated” health systems have not been able to deliver meaningful results. Sure, they’ve become financially integrated, and in some cases - clinically integrated, but very few have achieved true functional integration, which, in my opinion, is where we need to focus.