More than 15 years have passed since the publication of Michael Porter and Elizabeth Teisberg's iconic book Redefining Health Care.
As a seasoned consultant, Porter delivered a simple message: Value-Based Healthcare (VBHC), an attractive concept to healthcare professionals, providers and payers. Presented as a solution to the health care crisis in the United States, the concept of value – the relationship between results and the cost to achieve them – quickly spread throughout Europe, South America and Australia. Like a magic potion, it provided a solution for almost all health-system problems: addressed fragmentation, variation, over-provision of care, financial lack of sustainability, medical errors, clinical compromise, lack of trust, patient disengagement, etc.
Soon, recognizing the need to implement a simple concept in a complex system, Porter partnered with the Boston Consulting Group (BCG) and Karolinska University Hospital to create the International Consortium for Health Outcomes Measurement (ICHOM). Taking the rich clinical databases in Sweden as an example, it was suggested that only extensive registries would ensure the measurement of outcomes. In the absence of concrete examples, the Martini Klinic localized prostate cancer example was repeatedly presented and, based on this convincing example, which shows significant differences concerning erectile dysfunction and incontinence outcomes, the concept of value was easy to sell. Dealing with coding diversity and the need to adjust for individual patient risk, the first sets of clinical standards were developed, and several pathology-specific sets of standards were developed some years later.
However, data collection for outcome measurement across the continuum of care is laborious and, in some cases, a questionable use of clinical resources. Moreover, the specific pathology-focused approach to developing the sets of standards and the high level of independence of individual expert groups resulted in insufficient harmonization of measures across pathologies. From a practical point of view, organization-centric health information systems still constitute barriers to the rapid implementation of measurement and comparability of results. From the cost point of view, implementation issues also arise for comparability. Although it is commonly acceptable to use activity-based costing over time, carrying out the methodology requires additional resources and organizations are unwilling to share cost data.
We are in September 2022 and it has rained a lot. Where are we now? Where are the evidence and success stories of the VBHC? Please don't get me wrong. The VBHC has shown new ways of looking at the health system, influencing payers around the world to move from fee-for-service or case-based payments to blended payments and pay-for-performance. The Affordable Care Act (also known as Obamacare) was heavily influenced. Hospitals started to question their vertical organization according to medical specialities and some have evolved towards new organizational models (eg, clinics based on specific pathologies, and clinical trajectories). Karolinska University Hospital is probably the boldest among the major hospitals in abolishing traditional departments and developing new organizational models based on the clustering of clinical pathways. Some international organizations have adopted the concept and associated it with ICHOM. The OECD has developed Patient-Reported Indicator Surveys. The pharmaceutical industry has been the most open to the concept among healthcare players, seeking value-based acquisitions and joint ventures based on clinical results. But where are we now and what comes next?
As Peter Drucker mentioned, hospitals are one of the most complex organizations in modern society. Several forces defend the status quo and a concept is not enough to counteract the institutional and professional forces. Only adequate management will ensure the necessary force to promote change. Neither VBHC nor any other idea will emerge without sound and committed leadership.
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