What is Value-based Healthcare?
The term value-based healthcare was initially coined by Michael Porter, a professor at Harvard University, as "health outcomes achieved per dollar spent".
This value equation reflects a system-level assessment of how well the limited healthcare resources are deployed to improve health outcomes at a population level.
The Centre for Evidence-Based Medicine of the University of Oxford provides a definition of value-based healthcare, which is congruent with NHS core values as a publicly funded single-payer health system.
"Value-based healthcare is the equitable, sustainable and transparent use of available resources to achieve better outcomes and experiences for every person".
As lofty as this goal sounds, it lies on a central tenet; effectiveness.
Consequently, a value-based framework requires measures for health outcomes that can objectively evaluate the effectiveness of healthcare.
But we need to go beyond simply looking at metrics; without actually improving healthcare services, metrics will merely be a reporting exercise.
What improves effectiveness is enabling the right care at the right time as consistently as possible.
Consequently, healthcare designers should examine how to align incentives between the different players involved in healthcare.
Paying the right value for the right care
Payment models incentivise doctors on what to prioritise their time and effort.
In many health systems, payment models favour quantity over quality. Unfortunately, this can result in friction between financial compensation received and the quality of care delivered.
Aligning as closely as possible the incentives of the payer, clinician and patient will improve effectiveness considerably.
Value-based payment models look to hold the health system accountable for delivering high-quality care efficiently to improve health at the population level.
In such a model, prices of health services are tied tightly to health outcomes instead of simply the amount of care provided.
The NHS introduced the quality outcomes framework (QOF) in 2004 to incentivise practitioners to improve the effectiveness of primary healthcare delivery.
With a budget of £720M, QOF represents 7% of the total primary care budget for 2021. It is one of the most ambitious initiatives taken in Europe to move towards a performance-related payments model.
Nonetheless, the evidence of whether QOF results in an improvement in quality of care is questionable: “No convincing evidence” that QOF improves care of patients with long term illness | The BMJ
One pertinent review “The value of pay-for-performance in England: An evaluation of NHS England’s Quality Outcomes Framework” (The value of pay for performance in England- An evaluation of NHS England's Quality Outcomes Framework) suggests that the reason for why QoF struggles to ensure value is a result of the metrics used.
“Many of the indicators measured by QOF do not measure patient outcomes. The English NHS is rewarding practices for their performance on process and structure measures rather than actual outcome measures that impact patients. This is concerning because there is still tremendous variation in the quality of care and there exists little evidence that QOF has directly reduced health inequalities”
What makes developing a value-based payment model so difficult?
The main difficulty we believe is the inability to measure the patient outcomes of preventive healthcare. It is exceptionally difficult to measure outcomes of primary care given the longitudinal nature of healthcare as a process and its associated outcomes. The volatility of patient behaviour in terms of adherence is another factor in a real-life setting that is difficult to capture.
We believe with the advent of remote monitoring and data analytics new ways of capturing healthcare outcomes of preventative care is possible. We need to consider how to integrate more prospective metrics into practice by leveraging health economics and developing new economic models.
Performance evaluations reports and tools such as (CVD Intelligence packs) and (CVD ROI tool) testify how more sophisticated methods for predicting future outcomes have an immense potential to incentivise providers and drive improvement in preventive care.
Enable fruitful consultations that generate value
Whatever the incentive model, healthcare designers should constantly look to create the right environment for clinicians to effectively intervene and for patients to engage with transformative self-care.
Clinicians need to be supported given they work under a lot of pressure, deal with complex cases with incomplete information and have limited time per patient. Tackling head-on the complexities is a must. Below is a non-exhaustive list of complexities to be addressed
- Information asymmetry
- Co-Morbidities
- Time
- Clinical guidelines & reporting
- Payment models & available funds
For patients what happens around clinical appointments is as important if not more important than the consultation itself.
Getting the right patient in the clinic at the right time is essential. Improving health and risk awareness and providing speedy and convenient access will vastly improve the effectiveness and value of clinical interventions. Read our blog: Prevention: A Game of Risk
We need to constantly aim to maximize patient engagement enablers.
Conclusion
Health services struggle to meet the demand for high-quality care. Furthermore, the projected increase in demand for healthcare resulting from demographic trends, high prevalence of chronic conditions and the risk emanating from the current and any potential future pandemics makes the need to improve the effectiveness of primary healthcare an urgent priority.
Value-based healthcare is a model that establishes incentives for healthcare providers to deliver high-quality care that maximises health benefits at a population level.
Financial frameworks that pay for healthcare services should look for new innovative prospective metrics that capture health outcomes.
Only a holistic approach where incentives are adequately aligned, clinical pathways are optimised, and patient engagement is proactively encouraged and supported can we dream of making this radical transformation a reality.
At Syncreny we look forward to joining health professionals on this journey.
Author: Amir Kamal Co-Founder of Syncreny
