The “value” in value-based healthcare is derived from measuring health outcomes
against the cost of delivering the outcomes. All stakeholders in healthcare have a shared
goal that unites the interests and activities for improving performance and accountability.
However, stakeholders have conflicting goals in access to services, profitability, high
quality, cost containment, safety, convenience, patient-centeredness, and satisfaction.
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 (Porter,
2010).
Value-based healthcare is a healthcare delivery model in which providers,
including hospitals and physicians, are paid based on patient health outcomes. Value-based
care differs from a fee-for-service or capitated approach, in which providers are paid based
on the number of healthcare services they deliver. The benefits of a value-based healthcare
system extend to patients, providers, payers, suppliers, and overall society. Patients spend
less money to achieve better health by managing chronic conditions like cancer, diabetes,
high blood pressure, COPD, or obesity. Providers achieve efficiencies and greater patient
satisfaction by spending less time on chronic disease management. Payers control costs
and reduce risk by bundling payments. Suppliers align prices with patient outcomes.
Society becomes healthier while reducing overall healthcare spending helping people
manage chronic diseases and costly hospitalizations and medical emergencies (NEJM
Catalyst, 2017).
Value in healthcare can be increased by both improving quality and reducing cost.
A quality management system reduces cost by workflow efficiency and solving problems
fast, easing change management within the healthcare organization. It also reduces cost by
reducing operational errors, assisting in risk management, and improving supplier quality
by making it easy to rate and communicate with suppliers (EQT, 2021).
In my opinion, the government should be in a central position to issue physician
practice guidelines based on cost efficiency. Some strategies include control spending
growth, ranging from promoting competition, reducing prices through regulation, and
designing incentives to reduce the utilization of low-value care to more holistic policies
such as imposing spending targets and promoting payment reform. The government can
provide free treatment to the poor through the public health system and provide health
insurance to the poor.
5
References
EQT. (2021, March 22).55 ways the quality management system reduces the cost of
quality. ETQ.5https://www.etq.com/blog/5-ways-the-quality-management-system-
reduces-the-cost-of-quality/
NEJM Catalyst. (2017, January 1).5What is value-based healthcare?5NEJM Catalyst -
Practical Innovations in Health Care
Delivery.5https://catalyst.nejm.org/doi/full/10.1056/CAT.17.0558
Porter,5M.5E. (2010, December 22).5What is value in health care? | NEJM. New England
Journal of Medicine.5https://www.nejm.org/doi/full/10.1056/nejmp1011024
