Dr Farzad Mostashari Says There Is a Lot of Work to Do on Care Transformation

The move to value-based payment is going well, but the real work has to be done on the care transformation side, Farzad Mostashari, MD, co-founder and chief executive of Aledade, said at the National Association of Accountable Care Organizations Spring 2016 Conference in Baltimore, Maryland.

Transcript (slightly modified)

How do you think the move to value-based payments is going so far?

Look, the move to value-based payment is going great. The delivery transformation to meet the new payment models is where I think we have a lot of work to do.

There’s been a massive increase in the number of accountable care contracts—those on the Medicare side, those on the commercial side, and there isn’t a single payer that we’ve talked who hasn’t said “sure, yeah, we’re interested in a risk-based contract.” The challenge is just having a new payment model doesn’t automatically guarantee that you’re going to have care transformation. The real work that has to be done is on the care transformation side.

Do you think accountable care organizations (ACOs) are here to stay?

I do, I do think ACOs are here to stay. If we’re able to actually create better care at lower costs.

In this new volume to value transition, I said there are 3 options for business models. Option 1: Deliver better care at lower costs. It’s hard. Option 2: Create or support a local monopoly. Then you don’t need to deliver better care at lower costs, right? You just have a monopoly; monopolies are awesome in that way! And hope that the Department of Justice and the Federal Trade Commission, you know, don’t pick up on this. Option 3 is close your doors.

So we’re choosing option 1.