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Wednesday, December 29, 2010

More and more to come on the concept of "value" in medical care

I have commented about this general topic before . See here.

The December 23, 2010 issue of NEJM has two articles on this topic. The first is from a member of the faculty of the Harvard Business School, M. E Porter and the second by T.H Lee. Dr. Lee is one of the NEJM editors and is also the network President for the Partners Health System.

Dr. Porter (Phd,Harvard,Business economics) is a widely published and widely quoted author.Concepts that he has popularized include: the Five Forces,the Value chain and the National Diamond model. In 2006 he co-authored a book with Elizabeth Teisberg entitled Redefining Health Care: Creating Value based Competition On Results.

Porter defines value as outcome achieved per dollar spent or value = outcome/cost. He has stated that health care should be restructured to consist of interdisciplinary teams to provide the outcome with the best value across "the full spectrum of health care". Having said that I am puzzled when he says that value is not an abstract ideal.To me that certainty sounds like an abstract idea because as pointed out in the second article in a understatement :

"No one should expect the value framework to be easy to implement.The measurement of outcomes and costs,the organization of clinicians into teams focused on improving care for patient populations,the evolution of a payments system that rewards providers who are more effective in improving the value of their care-they are all formidable tasks."

Formidable indeed. A reorganization of much or most of the medical system to one that conforms with Dr. Porter's conception of how it should be would be required.

I cannot help but be reminded of Will Roger's prescription for fixing the German U-boat problem -boil the oceans. Supposedly, when pressed for details he replied, in typical consultant fashion, he was an idea man and the engineers would have to work out the details. With the value framework model many details would have to worked out and then we could see how it would work and compare real world stuff with academic theorizing. We need to do it to see how it works.I've heard that somewhere before. Is there somewhere in the value framework some input from how much the patient values the service?


Doug Perednia, MD said...

A very interesting post. While they're at it, one might also ask these "value" experts to let us know how many angels can dance on the head of a pin. You know, in economic systems as in many other aspects of nature there are far too many variables and far too much complexity for mere humans to sort it out effectively. Let's take a very simple example - much simpler than anything healthcare is going to throw at us.

Three different airlines offer slightly different prices to fly you from Seattle to New York. One is cheaper, but it has stops along the way and takes a little longer. Another is more expensive and quicker, but the planes are always dirty and crowded and the flight attendants tend to be rude. The third takes an intermediate amount of time, but stops in Chicago where the weather is iffy this time of year. You might end up stuck for days if you're unlucky. They serve free drinks, but also have a baggage fee. But they also tend to lose your baggage at a higher rate than the other two. Quick question for Drs. Lee and Porter: Which one provides the best "value"?

The answer, of course, is that it depends on who you are and what your relative priorities and values are. Wasting valuable resources on coming up with a global "3rd party" assessment is a complete waste, and a fool's errand. There are too many variables - not just with respect to the airlines but also in the customers they are serving. This is why we have free markets, and why they have proven time and again (for centuries!) to be the most efficient way of allocating things. Have the folks at Harvard not heard of them???

Oops. I forgot. Harvard is where RBRVS was invented...

Anonymous said...

The experts would work with interdisciplinary teams to determine some multi-dimensional value.What happen to the economic idea that value was subjective and in the eyes of the person who purchases a good or service and not in the work or labor that went into it.Did not an economist in the 1800s show that the labor theory of value was invalid.But wait, the whole RBRVS system is basically a return to the generally discredited labor theory of value.