The need for value-based management in healthcare is well established and few doubt its usefulness. We at NHG have been actively promoting value-based management in healthcare for years, and our key message has been: start measuring outcomes. While the allocation of costs is also important, and by no means a negligible effort, fairly standardized practices for doing it do exist. The outcomes data, especially the patient-reported outcomes data, is what is largely missing, and without it, there can’t be any value-based management.
From a managerial perspective, then, the key question is how to get started with measuring: what are our objectives, what to measure, when, which metrics, which patients, etc. Some international initiatives like ICHOM and COMET have put together standard sets of outcome measures, which answer many of these questions. Especially in specialized care, standard sets have been created for many conditions, and as many conditions have a well-defined care path with a beginning and an end, the measuring is also relatively straight-forward. All in all, while acquiring the data does require some effort and accrue some costs, it is by no means rocket science.
Once we have the data, however, the next question arises: what should we do with it? In other words, how do we turn the data into knowledge which we can use to guide our decisions? This question is not addressed by standard sets or questionnaires.
The distinction between data, information and knowledge is not always clear. Nonaka (1994) and Zack (1999) distinguish between them as follows: data is observations without context; information is data in a meaningful context; and finally, knowledge is information that is interpreted through experience and communication. In short, the key is: context, experience, and communication.
The need for context is clear to any clinician who has come across a young, confident consultant with a degree in business, telling them how to do their job. What works in a car factory can rarely be implemented in healthcare as it is – but what context helps us see is what parts of it can be useful in healthcare as well. The same goes for experience: a quality-of-life score can potentially be seen as just a number without the experience of what these numbers usually are, and what affects them. Communication, then, is a concept that we see as highlighting the need for collaboration. The opposite of collaboration, self-sufficiency, is often touted as a virtue. However, it is not one when it keeps an industry or an organization from seeking different points of view – which can often be found outside one’s own field and specialty.
It is clear that whenever a question is answered, a new one arises. The quest for value-based healthcare is a journey with many currently unknowable problems. But that is exactly why we need to start measuring outcomes – because we can’t begin to find answers before we know what the question is.
The blog post has originally been published in EHMA’s blog on September, 29th 2020.
Are you attending EHMA 2020? Join our session “Value-based management of healthcare organizations” on Wednesday, 18 November 2020 at 13:30-14:45 CET.