Technical Value in Healthcare

Technical Value in Healthcare: determined by how well resources are used within services for each individual and the whole population .

Technical Value

…the proper objective is the value of health care delivery, or the patient health outcomes relative to the total cost (inputs) of attaining those outcomes. (1)

Productivity is measured by the relationship between outputs and cost, for example the number of peopletreated per bed per year . Efficiency is measured by the relationship between outcomes, not outputs, and costs, where the costs may be expressed not only as money but also as carbon or time, including the time of patients and carers. Technical value has to take into account not only efficiency but also the possibility of overuse and underuse

This is not only achieved by evidence-based decision-making, essential though that is.  The balance of good to harm changes as the amount of resources invested in an intervention or service increases as Avedis Donabedian showed in his classic diagram in 1980 which is reproduced below:

Value is replacing quality as the dominant paradigm for healthcare in the 21st century. Value is of course increased by quality improvement, by doing things better, cheaper, safer and greener; but doing things right is only half the story – it is also essential to do the right things by making the right decisions about identifying and discontinuing lower value activities.

How to Determine Allocative Value in Healthcare

Allocative Value in Healthcare: determined by how assets are allocated to services for different purposes.

Allocative Efficiency

Allocative value, or allocative efficiency as it is also known, has until recently being largely ignored in healthcare in part because of the dominant part that the United States plays in thinking and writing about healthcare. Allocative value requires a consideration not only of institutional quality but also of the impact that a healthcare service has on the population. There has recently been good work through the Choosing Wisely Campaign but the main aim is to reduce costs, not to help decision making for a whole population. Allocative value is a hot topic when needing to make a finite sum cover a whole population.

There are three levels of decision making needed to increase Allocative value in healthcare once the decision on how much to top slice for research and education and the decision on geographical resource allocation has been made.  These three levels of allocative decision making are:

  • Between programs, for example between cancer and mental health or vice versa
  • Within program between system, for example between asthma, COPD, sleep apnoea and breathlessness within the respiratory program and
  • Within system, for example within the resources available for COPD

Personal Value in Healthcare

Personal Value in Healthcare: the delivery of services informed by what matters to the individual.

Patient Centered Care

The term personalisation is used increasingly and, as a consequence, has developed an increasing number of meanings.

One of the earliest uses was in the definition of Evidence Based Medicine. Although accused of being cook book medicine, the origination of Evidence Based Medicine emphasised the need to relate the evidence to the unique clinical condition to the individual patient and his/her values:

Evidence based medicine is the conscientious, explicit, and judicious use of current best evidence in making decisions about the care of individual patients. The practice of evidence based medicine means integrating individual clinical expertise with the best available external clinical evidence from systematic research. By individual clinical expertise we mean the proficiency and judgment that individual clinicians acquire through clinical experience and clinical practice. Increased expertise is reflected in many ways, but especially in more effective and efficient diagnosis and in the more thoughtful identification and compassionate use of individual patients’ predicaments, rights, and preferences in making clinical decisions about their care.

Source: Sackett, D. L., Rosenberg, W.M.C., Gray, J.A.M., Haynes, R.B., Richardson, W.S. Evidence based medicine: what it is and what it isn’t. BMJ 312 (p.71).

The model described is perhaps better illustrated as a diagram:

This emphasises the need to take into account patients and their values to effectively deliver patient centered care. In some ways the term personalized medicine or personalized care is analogous to the concept of customisation in industry, made famous by Toyota and Dell Computers, and more recently, by the Mini factory in Oxford.

Customisation uses the benefits of large-scale construction when it makes sense but then customises the products to suit the needs of the individual. More recently the term personalisation has been associated with the use of genomic information as though it were a new term, but genomic information is not qualitatively different from biochemical information.  It is just information that needs to be tailored to the individual and should make the treatment specific to the unique clinical problems of that individual.

Other terms that have been used to describe how medicine will be practised when genomic information is available are the terms ‘precision medicine’ and ‘stratified medicine’ but the term personalised is probably now the most commonly used term.

It is important to remember that personalisation is just as important whether there is no genomic information available, as when there is genomic information available.

 The Oxford Value Improvement Programme


Tremendous progress has been made over the last forty years due to the second healthcare revolution, with the first healthcare revolution having been the public health revolution of the nineteenth century. Hip replacement, transplantation, and chemotherapy are examples of the high tech revolution funded by increased investment and, in the last twenty years, optimised by improvements in quality, safety and evidence based decision making. However there are still three outstanding problems which are found in every health service no matter how they are structured and funded: One of these problems is huge and unwarranted variation in access, quality, cost and outcome, and an analysis of unwarranted variation reveals the other two –

  • Overuse, which leads to waste, that is anything that does not add value to the outcome for patients or uses resources that could give greater value if used for another group of patients and often, patient harm, even when the quality of care is high
  • Underuse which leads to failure to prevent the diseases that healthcare can prevent, stroke and vascular dementia in atrial fibrillation for example, and often inequity

In the next decade need and demand will increase by at least 20 % so what can we do to tackle these outstanding problems and meet the growing need and demand?


The first step is to focus on value – on triple value The key transformation is from a focus on the quality of service for the patients treated by the individual institutions in Oxfordshire to improving value for the population as a whole and for every individual in the population with triple aims

  • Increasing personal value by ensuring that we focus on each individual’s problem as well as their diagnosis and ensuring that their values are taken into account in personalised decision making
  • Increasing allocative value by ensuring the optimal distribution of resources not only between different programmes such as the programme for people with cancer and the programme for people with mental health problems but also the population based systems within each programme for example within the respiratory health programme optimising allocation betten the services for people with asthma, those with copd and those wit hsleep apnea
  • Increasing technical value from the way the resources are used for all the people with a particular health need such as back pain, or atrial fibrillation or being at the end of life not only by delivering high quality care efficiently but by relating to all the people in need and minimising bot over use and underuse

Low quality care is low value , but high quality care may be of low value too if it does not add value for the population or the individual. The focus has to be on value


Firstly we need to continue to

1. Prevent disease, disability, dementia and frailty to reduce need
2. Improve outcome by provide only effective, evidence based interventions
3. Improve outcome by increasing quality and safety of process
4. Increase productivity by reducing cost

These measures reduce need and improve efficiency BUT we also need to increase value by

  1. Ensuring that every individual receives high personal value by providing people with full information about the risks and benefits of the intervention being offered and relating that to the problem that bothers them most and their values and preferences
  2. Shifting resource from budgets where there is evidence from unwarranted variation of overuse or lower value to budgets for populations in which there is evidence of underuse and inequity
  3. Ensuring that those people in the population who will derive most value from a service reach that service
  4. Implementing high value innovation funded by reduced spending on lower value interventions
  5. Increasing rates of higher value intervention eg helping a higher proportion of people die well at home funded by reduced spending on lower value care in hospital in that population

The Oxford Value Improvement Programme is focused on developing the systems, culture and skills required for all nine of these key tasks and improving the tenth factor – the morale of the people who deliver the service

Transformation Shop

We have different resources for different needs, which can help drive improvements organisationally, individually or both.

Organisational Development 

Our aim is to help organisations transform their culture and develop integrated systems of care.  We will help single organisations that want to transform its culture/service or a group of organisations that want to work together to develop networks to deliver integrated systems of care to their populations.

We start with a transformation workshop which helps the key people in the organisation: 

  • Identify the main pressures they will face in the next decade
  • Agree on the principal features of a service transformed to flourish in the new environment

As a result of the Transformation Workshop, organisations can commit to one of our transformation programmes:

The Integrated Systems Development Programme

The Culture Foundations Programme

Individual Development

These programmes are designed for people who want to lead improvement of health and healthcare – either a whole professional group that knows it needs new skills and knowledge to flourish in the new paradigm or individuals who want to transform the care they provide but are too busy for an MBA.

Professional  Development Programme  helping very busy people create and adapt to the new paradigm

Individual & Organisational Development

Masters level modules – on the Five Giants we still have to conquer and the Enablers of transformation

The How To Handbooks – Knowledge Geared For Action
As well as enhancing the Transformation Programmes, the How To Handbooks can be read alone. They are available on paper, Kindle, and digital versions are available for Iphone, Smartphone, Mac, or PC. The first set of titles is:

  • How To Create the Right Healthcare Culture
  • How To Manage Knowledge in a Health Service (coming soon!)

    Healthcare Foundations is a BVHC podcast service. A subscription to this service entitles you to receive podcasts on current healthcare topics that are important to you – topics such as redistribution of resources, streamlining, reducing waste and increasing value will be illuminated by introducing you to distillates from the 1000 greatest books about or relevant to the health of populations and the delivery of high value healthcare. We also have podcasts from 1000 great articles on the science of health service management. 

    Master the language of healthcare -Language creates the social reality of the world in which we work.  Being clear about the meaning of terms is one of the key steps in shaping culture. Even if a word has more than one meaning, it is essential that everyone in a health service is aware of this and agrees which meaning should be used.  For this reason, BVHC has developed the Glossary of 21st Century Healthcare and a range of other resources to help clarify, and make more consistent, the language of healthcare. 

    The BetterValueHealthcare Bookstore – for really good coffee and 1000 really important book

 We also create bespoke solutions to meet your needs – find out more here.

Meet the Better Healthcare with No More Money

How can we meet increasing need & demand with no more money?

Clinical advances of the last fifty years have led to dramatic increases in life expectancy and years of life free from disability. However, every health service still faces five outstanding problems and four new challenges that are interlinked: 

Better Value Healthcare has solutions 

Better Value Healthcare (BVHC) is a solutions company, which manufactures resources to solve problems, meet challenges and engage the drivers of change.

BVHC recognizes that the the problems facing health services cannot by solved by money (even if this were an option) or by reorganising the bureaucracy of healthcare.  They can, however, be solved by good leadership and harnessing the drivers for change, which will transform the square peg of 20th century healthcare into a service that fits with the needs of the 21st century.  A new paradigm is needed …
A revolution NOT a re-organisation!

BVHC’s resources can transform your health service while directly addressing your most pressing problems.  Our solutions will help to address different aspects of the problems all health services face.

The Mission of the Surgical Leadership Academy

The mission of the Surgical Leadership Academy is to help surgeons become even better leaders 

In England alone there are about two thousand surgeons in management and leadership positions in addition many young surgeons see the need to develop understanding of management and leadership to prepare them for the health service or academic jobs.

The distinction, and relationship, between management and leadership is now generally agreed with leaders shaping and changing culture whereas managers work within the culture of the organisation. Almost all leaders are also managers but not all managers are part of leadership. Both activities are of vital importance for delivering high quality, safe and high value service to both individual patients and populations.

The principle of the Institute should be for action learning and people to bring problems either at face to face meetings or, increasingly, on-line action learning programmes. There are a very wide range of issues involved in  leadership and management, but it is recommended that the Institute focus on those issues that are particular to surgery, contextual leadership and management to use the jargon.

Walking Therapy

How do we know that walking does more good than harm?

One source of evidence is that the people who walk say that walking makes them feel, and look, good. But this does not prove that walking is beneficial or, as is said when new medical treatments are evaluated, that it does more good than harm.  It might be that people who feel good about themselves and who are healthy, walk more than people who are depressed or unwell, and there is probably some truth in that

A second method is to question people with a problem such as heart disease or depression about their lifestyle before they became ill, and compare their answers with the results of interviews of another group of people chosen because they are identical to the group that is ill – for example, same gender, same social class, same job – in fact being as similar to the people with the disease as possible except for the fact that they do not have the disease. This approach produces scientific evidence but, like all scientific methods, has its flaws. For example, one study of four questionnaires used in interviewing people about their exercise habits demonstrated that very different results were obtained, depending on which questionnaire was used. The answers given by the same people ranged from 81 minutes in response to one questionnaire to 242 minutes in response to another.

Pedometers do away with the problem of both memory and questionnaires, but you cannot go backwards in time so studies of walking, and other forms of exercise, have to rely on memory as well as questionnaires, and both are unreliable

In spite of these difficulties, there is now a large amount of evidence about the benefits of walking.

A drug has indications and contra-indications.   The indications are the reason why a drug should be prescribed, the contra-indications are reasons why it should not be prescribed.   For example, bacterial infection of the tonsils is an indication for penicillin, but allergy to penicillin is a contra-indication.   There are many indications for walking, but what about the contra-indications?   Some people with chronic conditions worry about taking more exercise, but there are no chronic conditions or diseases for which walking is contra-indicated.   Walking has been shown to be beneficial for many diseases, including:

  • heart disease
  • diabetes;
  • arthritis;
  • intermittent claudication;
  • osteoporosis;
  • lung diseases;
  • cancers;
  • psychological problems

One reason why walking is helpful in so many chronic diseases is that it tackles a complication common to all chronic conditions – loss of fitness.   Disease has direct and indirect effects. The disease directly affects certain parts of the body.   In coronary heart disease, for example, the arteries to the heart itself are affected; in neurological disease it is the brain. However, many chronic conditions also have indirect psychological and physical effects, most commonly depression and loss of fitness

A vicious cycle develops. The disease causes inactivity and the inactivity itself increases joint stiffness and the loss of muscle power, making the person feel even more depressed.

Erewhon Healthcare System

A system is a set of activities with a common set of objectives and an annual report. For each objective one or more criteria are identified to measure progress or the lack of it and for each objective standards have been agreed and there are three standards:

  • A minimal acceptable standard, for which no service should fall;
  • An excellent standard, the best standard of care in the world;
  • The achievable standard, the level of performance that distinguishes the top quartile of services worldwide from the rest.

These 3 levels of standards have been chosen because experience has shown that simply asking people to be the best, an approach once popular based on the book called “In Search Of Excellence” can be disheartening to those who are far away from the best or for those who see the best services delivered by what they perceive to be services privileged by either an excellent investment or rich resources, for example by charismatic or excellent people, as a result of chance. By identifying the achievable standard however is usually possible for a service in the lowest quartile to being shown a service serving a population in the top quartile which is very similar in terms of wealth and deprivation. Services in the top quartile can of course be encouraged to try to equal the best and the best service itself will be constantly looking for ways to do even better.

Systems of care are based on symptoms such as headache or pelvic pain, on diseases such as bipolar disorder or asthma or stroke or on population subgroups such as children or frail elderly people or people with the triple diagnoses namely physical health problems, psychological health problems and substance abuse, sometimes called people with co-morbidity.

It is useful at this point to distinguish between complexities and complicated because when describing the systems approach of Erewhon to clinicians from other countries they often remark that people have more than one condition. We recognise that maybe people have complex problems, for example an 81 year old woman with 4 diagnoses and 7 prescriptions who is looked after by her 52 year old daughter who lives 2 miles away and who has an alcoholic abusive husband and an unemployed son living at home. This is complexity but it is the need meant frequently by general practice or family medicine. Generalists excel in the management of complexity. Of those 4 conditions diagnosed one may cause problems from time to time requiring referral to a specialist because the problem has become too complicated for the generalist. Specialists excel in managing the complicated. The relationship between generalists and specialists need to be carefully worked out but the distinction between complexity and complicated is accepted as part of the language of the Erewhon Health Service.

Erewhon Healthcare – The Best in the World

Erewhon has a population of 5 million people. It is a population with an age distribution typical of most developed countries with about 15% of the population over the age of 65, and the population is ageing. Most live in cities, with two big cities each with a medical school, and city living is increasing and there are some thriving towns and some depressed industrial areas and large sparsely populated rural areas.

The economy of Erewhon is improving slowly but taking into account the impact that population ageing has on health and social care; it is wise to work on the assumption that there will be no real increase in resources available for health and social care.  The population of Erewhon is covered by a payment system that is based on combination of tax and insurance but the responsibility for health services is discharged to 10 geographical areas each with a budget taking into account age and deprivation. They have the responsibility for resource allocation; the responsibility for health service provision is based primarily on programmes and systems. Each of the populations, served by the Health Boards called A-J, happen to have a hospital, largely for historical reasons, with two of them being larger teaching hospitals and there are ten Mental Health Services and about 50 general practice teams in each.