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MOSFET compact models are integral parts in the process cycle of designing, simulating, verifying and fabricating integrated circuits. These are used for rapid calculation of transistor characteristics during circuit simulation. Compact MOSFET models should be simple, numerically fast, and accurate. Moreover, the models should be predictive and scalable over wide ranges of device parameters. In case of the emerging nano MOSFETs, the traditional threshold voltage based compact models do not satisfy the above requirements. Surface potential based compact models have become popular in recent years due to (i) incorporation of physically-based equations, (ii) ensuring symmetry and (iii) inclusion of accumulation region. While surface potential based MOSFET compact models are inherently semiclassical, operation of today's MOSFETs are modified by a number of non-classical effects, such as, quantum-mechanical effect, ballistic effect and gate tunneling current. Quantum-mechanical effect causes the surface potential to continue to increase in strong inversion region instead of saturating. It also increases the magnitude of the surface potential in accumulation region. Existing surface potential based compact models include quantum-mechanical effects in a variety of ways. Most methods use indirect approaches, involve equations containing a number of fitting parameters, are not widely scalable and often lead to results which are not very accurate, particularly in accumulation. In this presentation, we will review the various approaches that have been used to model quantum-mechanical effects in surface potential based compact models. Finally, we will propose a new physically-based technique to include quantum-mechanical effects in a direct manner with more accurate results.