Health

An introduction to value-based healthcare in Europe

April 22, 2015

Europe

April 22, 2015

Europe
Martin Koehring

Senior Manager for Sustainability, Climate Change and Natural Resources & Head of the World Ocean Initiative

Martin Koehring is senior manager for sustainability, climate change and natural resources at (part of The Economist Group). He leads Economist Impact's sustainability-related policy and thought leadership projects in the EMEA region. He is also the head of the, inspiring bold thinking, new partnerships and the most effective action to build a sustainable ocean economy.

He is a member of the Advisory Committee for the UN Environment Programme’s Global Environment Outlook for Business and is a faculty member in the Food & Sustainability Certificate Program provided by the European Institute for Innovation and Sustainability.

His previous roles at The Economist Group, where he has been since 2011, include managing editor, global health lead and Europe editor at The Economist Intelligence Unit.

He earned a bachelor of economic and social studies in international relations from Aberystwyth University and a master’s degree in diplomacy and international relations from the College of Europe.

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The effort to assess more accurately the value of healthcare investment has extensive implications for patient access, reimbursement of healthcare providers and health outcomes. Yet, the adoption of value-based healthcare in Europe has been piecemeal so far.

European governments, like those in other parts of the world, are feeling the strain on their health budgets caused by an ageing population, a rise in the prevalence of chronic conditions and the acceleration of medical innovations that have increased demand for state-of-the-art treatment. As a result, governments are looking to make their money stretch further.

Traditionally, efficiency in healthcare has been interpreted largely in terms of cost reductions. More recently, healthcare policymakers in developed economies have interpreted the notion of value according to the willingness of health systems or individual health providers to follow best clinical practice. Increasingly, however, practitioners are promoting a more holistic, patient-centred understanding of value—one championed by the academics Michael Porter and Elizabeth Olmsted Teisberg, who first coined the term “value-based healthcare" [1] (VBH) to describe outcomes of health treatment relative to cost.

The effort to assess more accurately the value of healthcare investment has extensive implications for patient access, reimbursement of healthcare providers and health outcomes. Yet, the adoption of VBH assumptions in Europe has been piecemeal so far, with large variations in the extent to which European health systems measure patient outcomes, the ways in which they define value and the metrics that they use to do so. Equally, despite the demand for better access to healthcare innovations, the impact of public opinion on health policy varies across the continent.

Efforts to extend the use of VBH models in Europe have fallen short because of a lack of consensus so far about what performance indicators should be used, who to reward and how to quantify the value of incentives to motivate further efficiency. The absence of data on activity, cost and outcomes is particularly lacking in the area of ambulatory and primary-care-based interventions. A more extensive and standardised approach to VBH will require stronger evidence to support treatment and better co-ordination of care. 

[1] Porter, M. E., “What is Value in Health Care?”, The New England Journal of Medicine, 363:2477-2481December 23rd 2010.

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