Continued push to value-based care the key to lower healthcare costs, experts tell legislators 

Policymakers looking to lower healthcare costs must continue to push the industry toward value-based models, experts told legislators at a hearing on Tuesday. 

The Senate Health, Education, Labor and Pensions Committee convened the hearing on healthcare costs that included testimony from providers, researchers and purchasers in the business sphere.  

Brent James, M.D., clinical professor in the Department of Medicine at Stanford University School of Medicine, told senators they must continue to "vigorously" move toward value-based care to lower costs. 

"As we shift those financial incentives, … the whole industry steps up," James said. 

RELATED: Industry Voices—It's time to move to value 2.0 in healthcare 

James said that complexity is the key driver of wasteful spending, as patients with complex needs require significant coordination between clinicians and may be on duplicate or unnecessary medications and treatments. A barrier to addressing this problem is the current group of available electronic health records, which are not built to provide effective clinical decision support, James said,

"I personally believe the current crop of electronic health records are intellectually dead," James said. "They're very poorly structured in dealing with complexity in care." 

The lack of decision support and clinician education on options—particularly for drugs—can lead doctors to make choices that may not be driven by value, said Jeff Balser, M.D., Ph.D., CEO of Vanderbilt University Medical Center. 

For example, he said, doctors are presented with a slew of medication options for common conditions, but they may not be able to pick out which drug best treats a patient's condition while also being the most cost-effective. 

RELATED: Technology is key to addressing the opioid epidemic, experts say 

Though value-based care models have shown positive results, employers are concerned that the industry is still resistant to these changes, said David Lansky, Ph.D., CEO of the San Francisco-based Pacific Business Group on Health. Lansky said PBGH members are committed to making healthcare more valuable, but they have limited power to push providers in that direction.  

Instead, they find the inertia of the transition has slowed, he said. State and federal payers must support this transition, too, he said, as when providers have mixed incentives they'll stick with the traditional fee-for-service approach. 

Providers that are fully invested in value-based care, however, highlighted the positives at the hearing. Steven Safyer, M.D., CEO of Montefiore Health System, told the senators that the system has been engaged in value-based contracts before the term was a buzzword.  

Bronx, New York-based Montefiore's long history as a Medicare accountable care organization highlights how important it is to ensure that incentives for payers and providers are aligned. 

"We are in sync with the payer, … and we believe that's the secret," Safyer said. 

RELATED: Intermountain to put $12M toward issues like housing, food insecurity 

Safyer added that the health system's programs targeting the social determinants of health are also a key strategy for reducing costs by cutting down on unnecessary healthcare use.  

For example, nearly 50% of people living in the Bronx are overweight or obese, Safyer said, so Montefiore created a diabetes care management program aimed at helping these patients eat better and lose weight to reduce their cost burden on the healthcare system. 

Providers can be leaders in this arena, Safyer said, but programs aimed at the social determinants, such as housing and food insecurity, require participation from more than just health systems.