Shared Savings Still Not a Viable Model for Health Systems, Says University Hospitals CMO
MedCity News
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Contributed by: Kate Gamble
Summary
Shared savings programs, while beneficial for promoting value-focused healthcare, are insufficient as a standalone payment model for health systems, according to Patrick Runnels, chief medical officer at University Hospitals. He noted that despite earning $50 million from shared savings last year, this represented a mere fraction of total revenue, indicating that even a significant increase would remain inadequate for financial sustainability. Runnels advocates for a shift towards accepting greater downside risk through capitated contracts to better align financial incentives with value-based care. The current structure, which often requires sacrificing more lucrative fee-for-service income, creates significant hesitance among health systems to transition fully to value-based models without addressing internal cost reductions.
