What does Value-Based Health Care actually mean?

Value-based health care is an emerging paradigm which has the power to change health care as we know it, but in order to achieve real impact, it must be applied to the key decisions that make up care delivery.

Several hospitals, procurement and even regional health authorities, have started including health care quality and longer-term cost impact considerations in their procurement decisions.  That’s seems reasonable given that the public health system is there to provide for maintaining the health of the population.  But what is meant by value?  Value is not just about cost, but also and principally about broader patient health and societal benefits.  Value is therefore a holistic concept.

One of the most critical decisions is the procurement of products or services by health care providers.  By choosing one product or service over another, procurement officials are de facto impacting the care being offered and incentivizing the industry and other health care stakeholders to act in specific ways.  Given this significant influence, procurement agencies should be one of the key players in health care leading the effort to focus on value.  Value in health care is not about getting three for the price of two.  This has enabled them to take health outcomes into consideration as well as other quality criteria, along with the total lifecycle cost and longer-term costs of care, so as to ensure best value for the patient, the medical staff, the entire hospital group and society.

 

It is further encouraging to note the increased focus the 2014 EU public procurement directive has placed on the quality criteria. This directive, which is currently being transposed into national legislations by the member states, puts clear focus on total economic value by making the most economic advantageous tender the default criteria and encouraging the use of best price/cost – quality ration i.e. the best value for money.

MedTech Europe in partnership with The Boston Consulting Group and international procurement experts, have been leading the way in developing a framework and tools to help health care providers evaluate the broader patient health and societal benefits when procuring health products or services.

Gotz Gereke (Boston Consulting Group) on PodiumAt IMSTA’s Annual Conference ‘Embracing Technology in Value-Based Health Care’, Götz Gerecke, Managing Director and Partner of The Boston Consulting Group in Switzerland gave a presentation how BCG and MedTech Europe collaborated to create a framework and tool-kit to facilitate smarter procurement which will result in value and quality being included in tender evaluation in future. This will be a focus area for IMSTA in 2016 and beyond.

So, what does Value-Based Health Care actually mean?  See the BCG/MedTech document BCG-Procurement-Dec-2015.