Improving Value

Accounting for Value

We know we want better value in the health care system but it turns out it’s hard to measure value.

Value in health care can be increased by improving quality or reducing costs (or both at the same time), and it is essential to consider value in any conversation about health care cost containment. When costs decrease but quality also decreases, we’ve lost value and we need to reconsider the cost-reduction strategy.  

Accounting for Value: Does the strategy…
 

In addition, we need to acknowledge that some health care spending yields extraordinary benefits in terms of longer life, improved quality of life, reduced suffering, etc. When improved health results in a longer life, this may increase costs because the person has more years to consume health care.¹

The bottom line is we don’t want to assess cost-reducing strategies without accounting for the impact on consumers’ access to health care and quality of care.

While we can broadly agree on these concepts, we don’t have ways of measuring value directly.  As we go forward, we don’t yet have a good way to synthesize price and quality into a single measure.  Even our methods for measuring quality are still under development.