Redefining the Value in Healthcare

Somya Gulati
Wed 01 June 2016


It seems that everywhere you look value-based care is hailed as the savior of U.S. health care. With it, comes the promise of a system that pays for quality rather than volume.  Let’s hope that’s true for “value” in health care. Where other attributes – such as quality or managed care – have failed to galvanize the system’s diverse stakeholders, value may have a chance.

Opaque prices far removed from actual costs, a fragmented care delivery system, and for the most part, a dearth of information about what we actually get for our money have ruled the American healthcare for decades.

On that note, value-based care is an appealing message.  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 an increased effort to measure patient-reported outcomes of care, such as their level of function and perceived health status over time. The concept of value would provide a north star toward which health care providers could navigate.

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 exposes the daunting challenges facing health system reformers. In any field, improving performance and accountability depends on having a shared goal that unites the interests and activities of all stakeholders. In health care, however, stakeholders have myriad, often conflicting goals, including access to services, profitability, high quality, cost containment, safety, convenience, patient-centeredness, and satisfaction. Lack of clarity about goals has led to divergent approaches, gaming of the system, and slow progress in performance improvement.

Value in health care remains largely unmeasured and misunderstood.

The compelling need for a good definition of health care value highlights fundamental challenges. We have not yet developed scientifically sound or accepted approach to define or measure either patient-centered outcomes of care, or – surprisingly – the costs of producing those outcomes. Equally challenging is the lack of data systems to support outcome measurement.  Producing the holistic assessments requires the aggregation over time and space of data from multiple clinicians and healthcare organizations, as well as patients themselves. The health care system’s electronic data systems are just now entering the modern age.

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

Even though it will be manifested with time but achieving high value for patients must become the overarching goal of health care delivery, with value defined as the health outcomes achieved per dollar spent. This goal is what matters for patients and unites the interests of all actors in the system. If value improves, patients, payers, providers, and suppliers can all benefit while the economic sustainability of the health care system increases.

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