By using this site, you agree to the Privacy Policy and Terms of Use.
Accept
Health Works CollectiveHealth Works Collective
  • Health
    • Mental Health
    Health
    Healthcare organizations are operating on slimmer profit margins than ever. One report in August showed that they are even lower than the beginning of the…
    Show More
    Top News
    photo of hands with blue veins
    8 Proven Tips on Finding Difficult Veins
    November 12, 2021
    tips for getting over the pandemic blues
    4 Proven Ways to Get Over the Pandemic Blues
    February 22, 2022
    medical industry innovations
    How is CNC Machining Transforming the Medical Industry?
    June 2, 2022
    Latest News
    Clean Your Mattress Properly to Avoid Common Health Issues
    March 29, 2023
    5 Benefits Of HIPAA-Compliant Answering Services
    March 28, 2023
    3 Ways To Deal With Health Issues In Cities With High Pollution
    March 22, 2023
    What Tools Should Your Caregiver Have?
    March 22, 2023
  • Policy and Law
    • Global Healthcare
    • Medical Ethics
    Policy and Law
    Get the latest updates about Insurance policies and Laws in the Healthcare industry for different geographical locations.
    Show More
    Top News
    Even Non-Kentucky Doctors Need to Examine Kentucky’s Narcotic Bill
    July 31, 2012
    E-cigarette Makers Warn Consumers About Their Own Products
    October 4, 2014
    CO-OPs – The Stealth Public Option Under the ACA?
    September 6, 2012
    Latest News
    What Are Bioidentical Hormones Made With?
    March 23, 2023
    Cover Medical Costs of Child Dog Bites with Legal Specialists
    March 23, 2023
    3 Ways to Improve the U.S. Healthcare System By 2030
    March 14, 2023
    6 Steps To Ensure Speed And Efficiency Of Clinical Studies
    March 14, 2023
  • Medical Innovations
  • News
  • Wellness
  • Tech
Search
© 2023 HealthWorks Collective. All Rights Reserved.
Reading: Getting Real About Health Care Value
Share
Sign In
Notification Show More
Latest News
healthy travel tips when visiting Australia
7 Essential Tips to Stay Safe and Healthy Visiting Australia
News
health risks of dirty mattress
Clean Your Mattress Properly to Avoid Common Health Issues
Health
eligble for NDIS?
Are You Eligible For NDIS? How To Apply
News
upgrade to your nursing career
4 Pertinent Ways to Upgrade Your Nursing Career
Nursing
career in nursing
8 Keys to A Fulfilling & Successful Career in Nursing
Career
Aa
Health Works CollectiveHealth Works Collective
Aa
Search
Have an existing account? Sign In
Follow US
  • About
  • Contact
  • Privacy
© 2023 HealthWorks Collective. All Rights Reserved.
Health Works Collective > Policy & Law > Health Reform > Getting Real About Health Care Value
Health ReformPolicy & Law

Getting Real About Health Care Value

DAVID BLUMENTHAL AND KRISTOF STREMIK
Last updated: 2013/10/07 at 8:00 AM
DAVID BLUMENTHAL AND KRISTOF STREMIK
Share
9 Min Read
healthcare value
SHARE

This post was first published in the Harvard Business Review

This post was first published in the Harvard Business Review

healthcare valueWords can spearhead social transformation.  Let’s hope that’s true for “value” in health care. Where other mantras – such as quality or managed care – have failed to galvanize the system’s diverse stakeholders, value may have a chance.

What seems special about the term is that, seemingly simple, it is actually complex and subtle. Under its umbrella, a wide range of interested parties can find the things they hold most dear, from improved patient outcomes to coordination of care to efficiency to patient-centeredness. And it is intuitively appealing. As Thomas Lee noted in the New England Journal of Medicine, “no one can oppose this goal and expect long-term success.”

More Read

everest healthcare

The Everest Foundation’s Mission to Support Inclusive Healthcare

Colleges Prove the Huge Benefits of AI in Healthcare Education
Using EHR systems in healthcare for Cost-Effective Services
Benefits of Emerging Technology in Healthcare in 2023
Why Is a Referenced Based Pricing Tool Necessary?

The question, of course, is whether the term will help spur the fundamental changes that our health care sector so desperately needs. In this regard, a closer examination of the value concept confirms its appeal but also exposes the daunting challenges facing health system reformers.

Michael Porter has defined value as “health outcomes achieved per dollar spent.” Any survivor of introductory microeconomics will hear echoes in this phrase of one basic measure of economic efficiency: output per unit of input. An efficient business gets the most output possible, given current technology, from every dollar spent.

Porter and colleagues adapt microeconomics to health care through their definition of output: patient-centered health outcomes. These are results that individual patients desire: survival, speedy and uncomplicated recovery, and maintenance of well-being over the long term. These are also things that clinicians, payers, and purchasers should seek for their patients, employees, and customers. The value movement’s definition of outcomes treats the patient as a whole person, insists that measures of outcome transcend disease-specific indicators to account for all of the patient’s conditions, and include data collected over time and space to produce comprehensive measures of patient well-being. Value proponents further insist that inputs be measured comprehensively to include all the costs of producing desired outcomes.

Widely adopted, the concept of value would provide a north star toward which health care providers could navigate.  Its emphasis on the whole patient and comprehensively measured costs would encourage teamwork among clinicians and coordination of care across specialties, clinical units, and health care organizations. The focus on patient-centered outcomes would support increased effort to measure patient-reported outcomes of care, such as their level of function and perceived health status over time.

Promising as it is, the emphasis on value also raises illuminating and challenging questions. The first is: why all the fuss with defining it? In most markets consumers define value by purchasing and using things. In the 1990s, personal computers had considerable value. We know that because consumers bought lots of them. Now, with the arrival of tablets, personal computers seem to be losing value.  And so it goes for untold numbers of goods and services in our market-oriented economy. Eminent professors don’t wrack their brains defining the intrinsic value of electric shavers, overcoats, or roast beef.

We need to define the value of health care, however, for a simple but profound reason explained in 1963 by Nobel-prize-winning economist Kenneth Arrow. Arrow showed that health care markets don’t work as others do, because consumers lack the information to make good purchasing decisions. Health care is simply too complex for most people to understand. And health care decisions can be enormously consequential, with irreversible effects that make them qualitatively different from bad purchases in other markets. Americans are therefore reluctant to let the principle of caveat emptor prevail. One reason to define value carefully and systematically is to enable consumers to understand what they are getting, an essential condition for functioning health care markets.

The compelling need for a good definition of health care value highlights another fundamental challenge. We have not yet developed scientifically sound or accepted approaches to defining or measuring either patient-centered outcomes of care, or – surprisingly – the costs of producing those outcomes. The scientific hurdles to defining patient-centered outcomes are numerous. Outcomes can be subtle and multidimensional, involving not only physiological and functional results, but also patients’ perceptions and valuations of their care and health status.  The ability of health care organizations to measure costs is primitive at best and doesn’t meet the standards used in many other advanced industries. Equally challenging is the lack of data systems to support outcome measurement.  Producing the holistic assessments needed requires the aggregation over time and space of data from multiple clinicians and health care organizations, as well as patients themselves. The health care system’s electronic data systems are just now entering the modern age.

Given the value of measuring value, and the current obstacles to doing so, still another urgent question arises: what should we do now? Despite recent moderation in health care costs, our health care system is burning through the nation’s cash at an extraordinary rate and producing results that, by almost every currently available measure, are disappointing.

To turn the promise of value measurement into the reality of better care at lower cost, a few short-term actions seem prudent. First, the nation needs a plan to turn the concept of value into practical indicators. Since government, the private sector, consumers and voters all have a vital stake in health system improvement, they should all participate in a process of perfecting and implementing value measures, preferably under the leadership of a respected, disinterested institution. The Institute of Medicine comes to mind, but others could be imagined.  This process should produce an evolving set of measures that will be imperfect initially but improve over time.

Second, both government and the private sector need to invest in the science and electronic data systems that support value measurement. Investments in systems should focus on speeding the refinement of standards for defining and transporting critical data elements that must be shared by patients, providers, and insurers to create patient-centered outcome measures.

Third, in consultation with consumers and providers, governments need to develop privacy and security policies that will assure consumers that their health care data will be protected when shared for the purpose of value measurement.

Last, and perhaps most important, the trend toward paying providers on the basis of the best available value measurements needs to continue. These payment policies motivate providers to use value measures to their fullest extent for the purpose of improving processes of care and meeting patients’ needs and expectation.

To some observers, putting value at the forefront of health care reform may seem obvious and non-controversial.  As Lee notes, who can be against it?  To use an American cliché, it seems a little like motherhood and apple pie: comfortable and widely endorsed. But the value movement could be much more than that.  When value does become a well-accepted principle, we’ll be much closer to making health care better for everyone.

 Original Post

(health care value / shutterstock)

TAGGED: healthcare costs

Sign Up For Daily Newsletter

Be keep up! Get the latest breaking news delivered straight to your inbox.
By signing up, you agree to our Terms of Use and acknowledge the data practices in our Privacy Policy. You may unsubscribe at any time.
DAVID BLUMENTHAL AND KRISTOF STREMIK October 7, 2013
Share this Article
Facebook Twitter Copy Link Print
Share
Previous Article A Caregiver’s Guide to Understanding the Stages of COPD
Next Article New Concussion Sensors, Apps Help Without Solving Key Diagnostic Issues

Stay Connected

1.5k Followers Like
4.5k Followers Follow
2.8k Followers Pin
136k Subscribers Subscribe

Latest News

healthy travel tips when visiting Australia
7 Essential Tips to Stay Safe and Healthy Visiting Australia
News March 29, 2023
health risks of dirty mattress
Clean Your Mattress Properly to Avoid Common Health Issues
Health March 29, 2023
eligble for NDIS?
Are You Eligible For NDIS? How To Apply
News March 29, 2023
upgrade to your nursing career
4 Pertinent Ways to Upgrade Your Nursing Career
Nursing March 29, 2023

You Might also Like

Bioidentical Hormones
Medical Education

What Are Bioidentical Hormones Made With?

March 23, 2023
child dog bite lawyer
News

Cover Medical Costs of Child Dog Bites with Legal Specialists

March 23, 2023
US healthcare system
Global Healthcare

3 Ways to Improve the U.S. Healthcare System By 2030

March 14, 2023
Clinical Studies
Global Healthcare

6 Steps To Ensure Speed And Efficiency Of Clinical Studies

March 14, 2023
//

We influence million of users and is the most authentic source of information on healthcare business and technology news.

Quick Links

  • About
  • Contact
  • Privacy
Subscribe

Subscribe to our newsletter to get our newest articles instantly!

Follow US

© 2008-2023 HealthWorks Collective. All Rights Reserved.

Removed from reading list

Undo
Welcome Back!

Sign in to your account

Lost your password?