‘Value-Based Health Care supports health management, clinical management and health decision making.’ – Prof. Dr. van Eenennaam

Overtreatment, undertreatment, overdiagnosis, underdiagnosis, uncontrolled costs and budgets, medical treatment errors and wrongly placed incentives have been reported across health systems in the developed world. The framework, concepts, practices; theories and tools of Value Based Healthcare (VBHC) are coined by Harvard, Harvard Business School and Harvard Medical School and Professors Porter, Teisberg, Kaplan, Bohmer and Christensen.  The concepts are described by Prof. Porter in his famous article in the New England Journal of Medicine (Porter, M.E. 2010), and have and are being developed internationally by amongst others Prof. Porters and Prof. Teisberg’s group at Harvard University and Business School as a central node reference. The ideas have proven their worth in renowned centers worldwide, including the Cleveland Clinic, UCLA Medical Center, Joslin Diabetes Center, MD Anderson Cancer Center, Children’s Hospital of Philadelphia and the Schön Klinik.

Decision making in health organizations

The management of a healthcare organization needs to be able to make decisions on what to do and what not to do, reimbursement policies, negotiations on the value delivered to patients, as well as the costs and risk management of the organization. CEOs of hospitals embarking on Value-Based Health Care initiatives have reported difficulties in lacking adequate information while being flooded with data on processes, structural data (Dimick J.B. et al 2004), “quality, morbidity data”, score cards, confusing costs and tariffs (DBC schemes), capital expenditures, detailed clinical research outcomes, annual reporting data, etc.

Payers, as in health insurance companies, patients, governments, oversight agencies or others, need to decide: when to receive treatment or not, at which place based on their medical condition(s), and at what likely outcomes, costs and risks. Accepting that doctors and hospitals cannot be everything to everybody, no patient exactly fits a protocol and no patient is 100% unique. From this medical perspective, it is challenging to search for right diagnosis and right treatment (Christensen, C. M. 2009).

Centered on Patients and Excellence

Taking all these views into account however, Patient Value must be central.  A focus on Patient Value is needed when making responsible decisions by decision makers and clinical management, within the health system and health delivery organizations. More precisely, Patient Value is patient relevant medical outcome divided by cost.
Clinical management, doctors, nurses and other (para)medical teams should contemplate their (non)interventions across the whole Medical Condition with the patient outcome and costs.

(Free after Michael E. Porter, What is value in healthcare? English Journal of Medicine, 363:26, December 2010)

Michael E. Porter on Value Based Healthcare Delivery (2012)

Michael E. Porter and Robert S. Kaplan, Harvard Business School professors and authors of the HBR article “How to Solve the Cost Crisis in Health Care,” explain why providers must start with proper measurement. (2012)

Michael E. Porter on Value Based Healthcare Delivery (2011)

Read more about the methodology

Read more:
What is value in healthcare?
By Michael E. Porter
The New England Journal of Medicine, 363:26, December 2010