Value (Outcomes/Cost)–A Unifying Concept for Health Reform?

In health care, stakeholders have myriad, often conflicting goals, access to services, profitability, high quality, cost containment, safety, convenience, patient-centeredness, and satisfaction.

-Michael Porter PhD, Professor, Harvard Business School

Those who support the new health reform law and those who seek to repeal it look at the new law through vastly different ideological lenses. Each ideological camp has its own implacable, rarely movable spin on what’s important.

But, according to Thomas Lee, MD, associate editor of the New England Journal of Medicine and networks president for Partners Healthcare System in Boston, the search for value (outcomes relative to cost) unites and provides a path forward for competing ideological interests.

In Lee’s words, “The value framework offers a unifying framework for provider organizations that might otherwise be paralyzed by constituents’ fighting for bigger pieces of a shrinking pie (“Putting the Value Framework to Work,” New England Journal of Medicine, and December 23, 2010).

As an ideological and idealistic concept, I would like to think a utopian vision focusing on value is achievable. But I remain dubious because of the nature of American culture. I am also skeptical partly because the concept originates in Boston, which has the highest health costs in the nation but which has scanty evidence that its outcomes are superior. Finally, I am leery because it takes large organizations with interoperable and expensive electronic systems that communicate with each other to measure value (outcomes/costs) for a bewildering number of different diseases with different outcome dimensions (survival, degrees of health recovery, time to return to work, side effects, pain, complications, adverse effects, sustainability, long term consequences) all measured over a longitudinal time frame among diverse stakeholders. Bringing such scattered data points into a single focus with a common understanding among diverse participants over a long time frame strikes me as nearly impossible.

It takes a large integrated organization, or a virtual organization with standardized measuring systems to do this, and I simply do not see this happening soon in America. In Doctor Lee’s words, it means “capturing data in different parts of the delivery system, which means that we all have to use the exact same terminology. And it means sharing accountability for performance.”

To paraphrase Hillary Clinton, “It will take a extremely large village,” or a unified homogeneous nation, and I do not see that happening soon in a country as diverse as America.

My wife, my son, and I have just returned from New Hampshire. The state’s motto is “Live free or die,” perhaps the best known of state slogans. The slogan reflects an assertive independence grounded in the American political philosophy of small government, individualism, freedom of choice, freedom of behavior, all which bear on outcomes and costs.

In New Hampshire we stayed at a bread and breakfast inn that served a communal breakfast. At our table was a Brazilian physician, a general practitioner, who now works as a faculty member in a university philosophy department. She espoused the philosophy of a universal health system shared by all nations based on the concept of health care as a “right” for every citizen of the world regulated by the World Health Organization. In other words, she believes in a worldwide health care utopia.

As a pragmatist and a student of American culture, I thought her concept was unworkable for the world in general and American in particular. So we fell into a discussion on the obstacles of sweeping health reform in continental, multicultural, individualist nations like the U.S. or Brazil, each with vast differences between the rich and the poor.

We disagreed agreeably, and I referred her to the work of Porter and Lee in Boston, emanating out of the Harvard medical academic complex. She liked what she heard. We agreed to have further discussions via email on seeking common ground for all patients.

For me the problem is not philosophical but practical. How does one control costs while meeting American’s and their lawyer’s expectations. No matter how stringent government regulations are, Americans have high expectations. We want more rather than less care. We are easily satisfied with the best.

Besides. with regard to cost, the poorest in America are the sickest and most expensive. Poor people are and will not able to afford or may not have sufficient information or funds to seek preventive or routine care. They will show up on the doctor’s or hospital’s doorstep with advanced disease, and costs to treat them will be high, as they are now in southern states like Mississippi and in America’s inner cities. The government now pays for them with Medicaid or Medicare funds but sooner or later Americans will tire of paying higher taxes, and doctors will tire of government regulations and low Medicare and Medicaid reimbursements. and may not be there to care for them.

I close with three questions.

1. Is overall health care value measurable?

2. Are the organizational, societal, and individual costs required to make this value measurement worth it?

3. Will the measurement of value unify ideological factions competing to advance the cause of health reform?

I have my doubts.

Richard L. Reece, MD, is pathologist, editor, author, speaker, innovator, and believer in abilities of practicing doctors and their patients to control and improve their health destinies through innovation. He is author of eleven books. Dr. Reece posts frequently at his blog, Medinnovation.

5 replies »

  1. It is generally a pointless exercise to even attempt to answer such broad and general questions. Question #3 is flat out absurd. It is more beneficial to more to more directed areas of focus on Question #1 and #2 (e.g., What is the value of measurements derived from patient-reported outcomes?)

  2. 1. How is value defined? Whose values? Physicians and HC researchers may agree on, say QALY or other outcome parameters (or surrogate parameters). Patients may care more about access (both financial access as well as local care with good parking), ill-defined and ill- understood “innovation”, physician rapport, comfort incl. luxurious birthing suites … the sick do care about outcomes, but they may be skewed towards hope (for example, take the advocacy for useless ALS drugs, or the research on MS of disease of impaired venous reflux).
    The only way to make real (outcome based) value count and to preserve choice would be a value based plan in competition to a conventional 3rd party pays all plan, with financial interest of the insured in cost.
    3. Seriously? That ideological factions (incl. death panel republicans) stop using HC reform for political ends?

  3. yes, yes, and see below.
    I think one can argue endlessly over what metrics to measure, how to measure them, whether measuring them is feasible, etc. etc. etc. and, in fact, these arguments have already been going on in health care for many years. It is tatamount to the arguments in my childhood between the US and Soviets (I believe they were the other party) over the size and shape of the negotiating table before they would sit down to negotiate – which held up progress for quite some time.
    The bottom line is that all parties have to come together at some point and agree on what to measure and how to measure it – and this will inevitably be somewhat arbitrary. The point is that the same yardstick will be used for all, and that we will progressively evolve these measurements as we go. Right now every insurance company, hospital, doctors’ group, and any other group in health care is measuring its own things in its own way, resulting in the present chaos.
    See this post from Paul Levy’s blog as a rather stunning example of one hospital’s required “quality” measurements, without even the value calculation (note he says it is only a partial list):

  4. In response:
    1. Potentially yes. Currently we lack ‘outcomes’ standards for measurement of the value numerator. Mere reporting of compliance and broad based definitions are too variable and do not necessarily address the relevant consumer i.e. the patient. There must be a clear definition of the appropriate outcomes which may not always be ‘survival’ ‘infection rate’ etc.
    2. YES. The cultural advancement that is required to empower the patient to realize their role in determining the structure of value-based care will be difficult. Additional positive externalities though might relate to improved overall health, prevention and responsibility. Perhaps unreachable, but worth the investment.
    3. Doubtful. To follow on Porter/Teisberg, the ultimate focus should be at the disease and patient level. This may directly contradict some of the goals of our insurers, hospitals and pharma/device companies…at least initially.

    I AM SKEPTICAL OF YOUR SKEPTICISM. My colleagues and I created http://WWW.HospitalValueIndex.com as a means to test this hypothesis, and the response from the industry was remarkable. It didn’t cost the government, taxpayers or you anything, and it didn’t require HITECH or ARRA or Meaningful Use funding. Not a single academic was distracted from research and not a single patient’s care was rationed.
    What VALUE does is help all constituents re-frame their thinking around the complex issues that you describe, without giving up on the ultimate goal. Thousands of management teams have learned from this perspective, and it was FREE.
    Advancing this concept to the breadth you describe is attainable and it will soon shape how we think about measurement. BTW, Porter/Teisberg went on to say so much more than your selected skeptical quote, and inspired me to find meaning in Value that much sooner. I think it is the kind of innovation we all deserve.