Many health systems are expanding their participation in value-based care models over the next few years, though few have substantial revenue at risk in value-based contract arrangements, according to a new Sage Growth Partners report.
The report, published Dec. 11, is based on a survey of 101 hospital and health system C-suite leaders from academic medical centers, integrated delivery networks and independent hospitals.
Four key findings from the survey:
1. Seventy-seven percent of leaders plan to boost their organizations’ participation in value-based care models in 2026 and 2027, a sharp rise from 57% who said the same in 2023.
2. Nearly 70% of hospitals and health systems participate in an accountable care organization, up from 53% in 2023. Sixty-one percent also said they participate in bundled payment models, up from 46% who reported doing so in 2023.
3. Just 20% of executives said the industry has made progress toward advancing value-based care over the past two years, fewer than the 40% who agreed with the statement in 2023.
“Despite slow progress during the last two years, many of today’s C-suites are developing strategies to expand their participation in VBC models in the next two years,” Dan D’Orazio, CEO of Sage Growth Partners, said in a news release. “Value-based care is both a challenge for C-suites and a way to strengthen their organization’s bottom line as payer dynamics evolve and macroeconomic uncertainties persist.”
4. Most hospitals and health systems still do not have a significant portion of their revenue at risk in value-based contracts, the report found. Fifty-four percent of leaders report generating between 5% and 20% of revenue in value-based arrangements, while only a small percentage earn more than 20% from VBC.
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