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Introduction

As increasing life expectancy, accompanied by the rise of chronic diseases, pushes up healthcare spending across the world, it has become clear to many policymakers and healthcare providers that a business-as-usual approach to cost containment is no longer sustainable. To continue (or in some cases start) delivering accessible, high-quality care, policymakers increasingly recognise the need to forge a link between healthcare costs and outcomes in order to improve value for patients.

In recent decades, healthcare systems in countries including the UK and US have worked towards measuring the relative cost efficiency and comparative effectiveness of different medical interventions. This approach, known as value-based medicine, followed the development of evidence-based medicine and expanded the concept to include an explicit cost-benefit analysis, with a focus on the value delivered to patients, rather than the traditional model in which payments are made for the volume of services delivered.

Nevertheless, making the shift to VBHC is far from easy, and the majority of countries are still in the early stages of assembling the enabling components for this new approach to healthcare. Implementing the components of VBHC requires a rethink of the overall quality of patient outcomes (and the longer-term benefit relative to the cost of an intervention), rather than just the quantity of treatments delivered. Given the deeply rooted culture of fee-for-service and supply-driven models, in which payments are made for every consultation or treatment, introducing new approaches will take time.

A few “frontier” countries are making impressive advances, with some evidence of the adoption of forward-thinking approaches. For example, the US Centers for Medicare & Medicaid Services (CMS) are in the process of shifting to value-based payments over the next five years through the introduction of bundled payments and other measures.1 In the European Union (EU), a collaborative of hospitals in the Netherlands, Santeon, is measuring patient outcomes using metrics created by the International Consortium for Health Outcomes Measurement (ICHOM),2 and the Organisation for Economic Co-operation and Development (OECD) is also starting to address areas such as payment systems, value in pharmaceutical pricing3 and the efficiency of healthcare delivery and the need for co-ordination of care.

However, many others—particularly lower- income countries, which are facing a range of development challenges—have yet to start out on this journey. With tremendous diversity in healthcare systems worldwide, some countries are bound to face bigger challenges than others in shifting to value-based models. Even for those that have started to make changes, decades- old practices and entrenched interests are difficult to dislodge.

This report summarises our findings in the assessment4 of VBHC alignment in 25 countries. Using indicators such as the existence of a high-level policy or plan for VBHC, the presence of health technology assessment (HTA) organisations or the presence of policies that promote bundled payments (where a single fee covers the anticipated set of procedures needed to treat a patient’s medical condition), this study intends to paint a picture of the enabling environment—from policies and institutions to IT and payments infrastructure—for VBHC alignment across a diverse set of countries.

The results of the analysis reveal a mixed picture, with considerable variations across countries. These range from those where pay-for- performance models and co-ordinated models of care are being introduced to countries where some of the basic tools needed to implement value-based care—from patient registries to HTA organisations—are still not in place.

The challenges are not to be underestimated. In many healthcare systems today, information about the overall costs of care for an individual patient, and how those costs relate to the outcomes achieved, is very difficult to find. As this study will show, health data infrastructure can be improved in most countries.

For example, data in disease registries that track the clinical care and outcomes of a particular patient population are often inaccessible, lack standardisation and/or are not linked to each other, if they exist at all. In some places, attempts to develop electronic health records have floundered. In others, they have been implemented but lack interoperability across different providers, which means that they are of limited use in facilitating co-ordinated, longitudinal care.

However, even in developing countries, adoption of aspects of VBHC can also be found. For example, Colombia’s recent health reforms include plans to organise health delivery into patient focused-units within 16 co-ordinated care programmes.5

By assessing the existence of core components of VBHC across countries, this study provides new insights into the state of the enabling environment for value-based care around the world.

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Value-based healthcare looks at health outcomes of treatment relative to cost. In this particular report The EIU examines the way in which value is interpreted across the continent, the extent to which European countries are adopting cost-effectiveness as a key criterion for assessing it, and the efforts to develop new models for pricing innovation.

Further reading:

An introduction to value-based healthcare in Europe Value-based Health Assessment in Italy: A decentralised model Value-based healthcare in Germany: From free price-setting to a regulated market Value-based healthcare in Spain: Regional experimentation in a shared governance setting Value-based healthcare in France: A slow adoption of cost-effectiveness criteria Value-based healthcare in Portugal: Necessity is the mother of invention Value-based healthcare in the UK: A system of trial and error

Value-based healthcare looks at health outcomes of treatment relative to cost. In this particular report The EIU examines whether Japan's healthcare system delivers good value for money, its approach to pricing and reimbursement, and the evolution of a nascent system for health technology assessment (HTA).

Further reading:

An introduction to value-based healthcare in Europe Value-based Health Assessment in Italy: A decentralised model Value-based healthcare in Germany: From free price-setting to a regulated market Value-based healthcare in Spain: Regional experimentation in a shared governance setting Value-based healthcare in France: A slow adoption of cost-effectiveness criteria Value-based healthcare in Portugal: Necessity is the mother of invention Value-based healthcare in the UK: A system of trial and error Value-based healthcare in Europe: Laying the foundation