EXECUTIVE SUMMARY
The US healthcare industry is still in search of a cure—a breakthrough model that can deliver high-quality care at lower cost. Over the past five years, hospitals, healthcare groups and medical practices have adopted new management structures and systems to curb spiraling costs. But none has proven to be a compelling way forward, and the pace of change since 2015 has slowed substantially.
Bain’s 2017 US Front Line of Healthcare Survey reflects an industry in the crosscurrents of change. No disruptive innovation has altered the rules of the game in healthcare the way online retail banking has transformed the financial services market or technology has upended other industries. Finding a better model in healthcare will take more time—and physicians want a hands-on role shaping it.
Steeped in a field that requires lifelong learning, many physicians are natural innovators and quick to test new systems and tools. But they staunchly resist new approaches that could put patient care at risk. That helps explain why management-led organizations that have not fully embraced physician input, for example, have run into resistance or have failed to make a greater impact. The US healthcare model remains firmly centered on physicians.
In fact, more than 60% of the physicians we surveyed believe it will become more difficult to deliver high-quality care in the next two years as they struggle to cope with a complex regulatory environment, increasing administrative burdens and a more difficult reimbursement landscape. After years of experimentation, physicians now want evidence that new models for care management, reimbursement, policy and patient engagement will actually improve clinical outcomes. Without it, they see little reason to alter the status quo and move toward widespread adoption.

Is there a way forward? Our survey findings indicate that bringing physicians back into the decision-making process helps create greater momentum for change. Physicians who are not aligned and engaged with their organizations have more reasons to resist new structures and systems, such as value-based payment models. By contrast, those who have a say in management decisions are much more satisfied with their working environment and more willing to lead change.
These are some of the key findings of our 2017 US Front Line of Healthcare Survey, which examines practitioners’ attitudes and concerns during a period of pivotal change for the industry. To better understand the evolving reality on the front line, we gathered input across the US from 980 physicians in eight specialties, 100 finance officers and 100 procurement officers.
We conducted the research for this report, our third US Front Line of Healthcare Survey, in a time of many open questions about the future of the Affordable Care Act, drug pricing and other regulations. However, the trends and business insights based on the data are likely to hold up under a broad range of policy outcomes. Our research focused not on how healthcare is funded, but on physicians’ and administrators’ priorities in care delivery—and the critical question of who has decision-making authority in the evolving healthcare system.
Why change has slowed
Physicians and healthcare organizations have become more cautious about adopting new structures, systems and tools for several reasons. With the first wave of change well under way, many practices already have implemented changes that are easy or required, and are reluctant to adopt more-complex systems and tools. Physicians are particularly hesitant to embrace new systems when the clinical implications and the return on investment are unproven and the administrative burden significant. As a result, many smaller physician-led practices may opt out, relying on a traditional approach to management and care.
Comparing our 2015 and 2017 survey findings, one notable slowdown has been in the adoption of value-based payment models. Many physicians anticipated a broad rollout of value-based care two years ago and a corresponding decline in practices using the traditional fee-for-service model. But few have been persuaded to switch, noting a lack of evidence that outcomes are the same or better using value-based care.

More than 70% of physicians prefer to use a fee-for-service model, citing concerns about the complexity and quality of care associated with value-based payment models. Fifty-three percent of physicians say that capitation reduces the quality of care, and most see little advantage from pay-for-performance models either. Further, many believe their organizations are not sufficiently prepared for the shift to value-based care.
Despite the reluctance to drop fee-for-service payment systems, many organizations continue to experiment with value-based care as part of a mix of payment models, recognizing the continual pull in the industry toward the value-based approach. Providers that want to move toward value-based payment models can generate greater support by working closely with their physicians to shape these models and addressing their concerns about outcomes, simplicity and fairness to all stakeholders.
More on the changing landscape
Practices are using more structures and tools, but the pace of change has slowed

Providers use many tools to improve quality and reduce the cost of care; greater adoption expected

Physicians strongly prefer the fee-for-service model

Physicians recognize that fee for service is more expensive than other models...

...but are concerned that the more advanced value-based models negatively affect the quality of care

As more practices adopt value-based care, they will need to address organizational alignment and risk management

Nearly two-thirds of physicians believe delivering care will be more difficult in two years

More on providers
Physicians are less likely than finance and procurement officers to recommend their organization

At physician-led practices, physicians tend to be more satisfied with their employer...

...and to be more aligned with the organization's mission

However, when physicians are engaged in decision making, Net Promoter Scores are similar

More on medtech
For medical device purchases, surgeons and procurement officers now balance clinical and economic value

85% of surgeons believe procurement has a neutral or positive impact on cost and quality

Surgeons are gaining decision-making authority over purchases of medical devices

Quality is the top criterion for surgeons purchasing medical devices, but price is becoming more important

Surgeons' advocacy is strongest for medtech market-share leaders

Surgeons continue to value sales representatives as a source of information

Surgeons highly value three key roles for medtech sales representatives

Alternative pricing models for medical devices are expected to gain traction in the next two years

More on pharma
Physicians' advocacy is strongest for pharma market-share leaders

Physicians rank outcomes, evidence and safety as their top drug-purchasing criteria

Price also matters; most physicians feel they should help control healthcare costs...

...but physicians mainly seek to minimize their patients' out-of-pocket costs...

...and cost sensitivity varies by specialty

Patients typically do not ask their physicians about the price of a treatment or service

Physicians and finance officers say price transparency is the best way to reduce drug prices

Physicians feel increasingly constrained by certain payer restrictions

Fewer than 20% of physicians rely on PBMs to improve costs and service

Physicians rely most on continuing education, conferences and online sources for information about drugs

Physicians value educational materials, samples and literature from pharma sales reps

Physicians expect a surge in alternative pharmaceutical pricing models, but previously overestimated the pace of change



