Five Issues Captivating Healthcare Leaders Right Now
The American Medical Group Association (AMGA) recently concluded its annual conference, bringing together leaders from the nation’s most prominent medical groups and health systems. Despite ongoing concerns about financial sustainability, governmental uncertainty, and workforce challenges, there was a palpable sense of common purpose and even optimism among the attendees. Here are the key issues and discussions that captivated healthcare leaders this year:
1. Growth and Consolidation of Health Systems
Health systems have solidified their position as the dominant structure for physician employment, continuing to expand through acquisitions and mergers. The prevailing message from health system executives was clear: "Grow or die." However, there is now a greater emphasis on smart growth, focusing on specific service lines, markets, or payers. Meanwhile, independent physician practices remain steadfast in providing an alternative employment option for physicians.
2. The Role of AI in Healthcare
Enthusiasm for artificial intelligence (AI) remains high, as it promises to address major challenges in care delivery, including labor costs, physician burnout, risk stratification, administrative burdens, and the need for better integration. Over the past year, ambient listening for note preparation has progressed from a nascent stage to standard practice. While ethical and security risks associated with AI must be carefully managed, there is growing recognition that AI will become increasingly embedded in clinical practice.
3. Intensifying Competition for Talent
The imbalance between increased patient demand and shortages in nearly every specialty has intensified the competition for physician talent. Physicians are now demanding higher salaries, signing bonuses, and work-life accommodations. The fierce competition for physicians has become national, driving up salary and benefit costs for all employers regardless of location. Meanwhile, medical groups and health systems are grappling with the need to control costs while improving productivity and access.
4. Medicaid Cuts: A Pressing Concern
Medicaid accounts for 20% or more of a typical health system’s revenue, and proposed cuts have raised significant alarm. Health systems with a rural footprint are particularly concerned, as they already operate with very thin margins. These systems are fully committed to advocating for the protection of Medicaid funding.
5. The Need to Reboot Value-Based Care
Current government value-based models have shown success for some physician enterprises, but appear to have reached a scaling limit. Additionally, medical groups and health systems report that commercial health plans are hesitant to move beyond pay-for-performance or minimal risk-sharing models. Achieving widespread adoption of value-based payment will require the dedication of more committed leaders.
What is clear from AMGA’s Annual Conference is that healthcare leaders are navigating a complex landscape. The call for a reboot of value-based care underscores the need for innovative solutions and committed leadership to drive the future of healthcare delivery.
Jerry Penso, M.D., MBA, is president and CEO of the Alexandria, Virginia-based American Medical Group Association (AMGA).
