Engaging Physicians for Success in Value-Based Payment

As payment for healthcare services moves from a fee-for-service model to contracts that reward value, systems must engage physicians in the enterprise of improving population health outcomes while controlling the cost of care.

Pay-for-value models disrupt traditional provider motives and relationships. In a fee-for-service model, physicians are paid for what they do in face-to-face encounters.

Value-oriented contracts reward efficiency, and this may mean treating some patients over the phone rather than bringing them into the office. Preventive services are rewarded. The intended consequence is to reduce sickness-related activity and the associated revenue stream. How does a delivery system engage physicians under these new circumstances?

Systems can engage physicians by providing:

  1. Financial incentives
  2. Clinical feedback
  3. Onboarding
  4. Practice support
  5. Social connection
  6. Participation in their destiny (in other words, a role in governance)

Financial Incentives

The most obvious way to engage physicians in population health management is to fairly share value-based revenues with the physicians who help create them. In the early stages of value-oriented contracting, payments may be small or non-existent, but as more contracts are added, and the entity becomes more competent in managing populations and creating savings, the incentive payments to individual physicians become significant.

Physicians will be engaged if they see how their personal investment in improving quality metrics, spending time on the phone with patients, supervising care managers, extending access, and controlling utilization equate to better incentive payments. Organizations that employ providers are wise to make the monetary contribution of value-based work clear in the employed physicians’ compensation model.

Clinical Feedback

Even before revenues from value-based contracts start flowing into the provider entity (and therefore before incentive payments can be distributed), physicians can be engaged by sharing with them their clinical quality and utilization management performance.

Performance feedback is highly interesting to physicians, who are competitive by nature and greatly concerned about the perceived quality of their care. No decent physician likes to be ranked 20th out of 20 on performance, compared with peers.

Physicians respond to objective feedback. When physicians believe their performance reports are accurate, they strive to better their scores.


Many entities inadequately invest in the formal orientation of physicians to the structure, goals, and resources of the organization and how each physician’s work is connected to its overarching purpose.

A thorough and detailed onboarding process can do much to engage physicians in the team effort that is required by value-based contracts. This process should be required for new and existing physicians in the organization and repeated when new contracts, resources, and clinical programs are introduced. Successful organizations often invest in a physician relations department or physician liaisons that assist physicians through the credentialing and onboarding process. This personal touch engenders loyalty to the organization.

Many organizations that engage in value-oriented contracts create a compact, which is a brief synopsis of the terms of participation clarifying what the entity will do to support the physician and what is expected of the physician in return.

Organizations should create a formal communication strategy and tactics, realizing that physicians consume information in many ways. Large group forums, small group meetings, written materials and electronic means of communication are useful to clarify the goals and programs of the enterprise. One of the most effective ways to engage physicians is to have early adopters share their positive experiences with their peers.

Practice Support

As in all relationships, physicians are more likely to do something for an organization that does something for them. Clinically integrated networks are legally able to extend a number of supports to member physicians, including helping to subsidize their acquisition of electronic medical records that support data integration. For many physicians, a manageable and enjoyable work life is as important as compensation.

In this age of immature and cumbersome information systems, physicians struggle greatly with the burden of documentation. If an organized system of care with the support of other care team members can optimize information systems to make the work load of physicians lighter, and possibly get them home earlier in the evening, it will naturally gain physician engagement.

Similarly, entities that engage in value-based contracts have the resources (global payments) to invest in care management resources that can significantly unburden physicians. Whereas a primary care physician (“PCP”) and his/her nurse may have formerly spent two hours during the course of a day managing care (but not getting reimbursed for it in a fee-for-service model), much of this work can now be done by system-employed care managers and navigators.

Social Connection

Studies show that compensation is not the main reason people stay with an organization. More than anything else, human beings want to feel accepted and valued in a community.

Over the past ten years, we have seen a huge shift in the social structure of medical institutions; namely the division of labor between hospitalists and outpatient physicians. While this division of labor is efficient, the unintended consequence is that physicians feel disconnected from their colleagues. Physicians used to converse on wards and in the doctors’ lounge, but now PCPs may refer to specialists for years that they have never met in person.

Organizations that want to engage physicians can create forums for them to get to know each other personally. Referrals and fluid information exchange (to the patient’s benefit) are enhanced by personal relationships. Quarterly socials, where physicians can really get to know one another personally, are well worth the investment in a CME program, food, and beverage.

Participation in Their Destiny – Governance

In organizations that engage in value-oriented contracts, physicians are critically needed at the table to lead clinical quality improvement efforts, evaluate clinical effectiveness and efficiency, improve access, and design care management programs.

Communicating that physicians are in the governance of these entities is very useful when recruiting other doctors into the network. This conveys to them that they will participate in their destiny and the programs and contracts in which they will be engaged.

Physicians are often in the majority on boards of clinically integrated networks, and they typically chair the board and its subcommittees. Models of incentive distribution are typically determined through physician governance. When physicians are given problems to solve, as well as the budget and other constraints of the organization, they come up with solutions they can sell to their colleagues.