While writing Volume to Value, I kept coming back to the same issue that many of us have in healthcare: there's no easy way to measure value.
I mean, there are lots of "potential" indicators of value, like graphs that demonstrate decreasing costs of care and others indicating improved quality of care, but nothing that easily gives me a good sense, in a number, of level of value in a healthcare service line.
There are some big data solutions that give an idea of value--but not really anything straightforward or direct as a measure.
And, yes, it's true that there are many reasons about exactly why that's the case.
Recently, after all that time thinking about the issue, a colleague asked me: "Could you measure the value in [insert service here] for me?"
The problem of how to measure value is one that we are all plagued by, now, in healthcare. Because of my statistical process control background, I know we already have capability indices and other indicators for how well a service is performing in terms of quality and how those are calculated based on what the patient (or customer where appropriate) considers acceptable. Now all we needed was a metric that included cost and a way to tie it all together.
Beneath, see my proposed index for how to measure value provided via a healthcare service: The Healthcare Value Process Index. It incorporates the requirements for measuring healthcare value that Michael Porter lays out hereincluding a focus on the voice of the patient in the process.
Just as importantly, it's based on well known capability indices and incorporates the costs incurred by poor quality performance. Take a look at the index by clicking the link beneath while I prep the academic paper for release.
Healthcare Value Process Index = (100) Cpk / COPQ where Cpk = the Cpk value for the system being considered, COPQ is the Cost of Poor Quality for that same system in thousands of dollars, and 100 is an arbitrary constant. (You’ll see why that 100 is in there under the example later on.) Yup, that’s it. Take a minute with me to discover the use of this new value metric....