A Practical Use Case Based Approach

The Problem

Healthcare systems are under increasing pressure to deliver better results while operating within constrained resources. Despite rising costs, care is still largely organized around activities, volumes, and organizational structures rather than around the value created for patients across the full care journey.

Performance measurement typically focuses on isolated indicators such as visits, procedures, or length of stay. What is often missing is a systematic way to understand how outcomes and the full cost of care relate to each other over time. Value in healthcare can only be understood when outcomes and costs are assessed together for a very well defined medical condition or care pathway. As a result, decisions about care models, technologies, and resource allocation are frequently based on assumptions rather than measured results.

Without linking outcomes to the total cost of delivering care for a specific condition, it becomes difficult to compare alternative pathways, identify low value activities, or understand where investments actually improve patient results. This leads to persistent variation, limited learning, and improvement efforts that struggle to scale.

From Outcomes Alone to Measuring Value in Practice

Focusing on outcomes is necessary but not sufficient. Costs need to be understood as investments in health and outcomes rather than as isolated transactional expenses. This approach builds on a simple principle: for a defined medical condition or patient pathway, outcomes and costs must be measured together across the full cycle of care.

Clinical outcomes, patient reported outcomes, and patient experience are assessed alongside the total cost of delivering care, from initial contact through follow up and recovery. Rather than introducing a new ideology or organizational reform agenda, this work starts with concrete use cases rooted in everyday care delivery.

A specific pathway is selected. Outcomes and costs are measured in a structured and comparable way. The results make trade offs visible and support informed decisions about how care is designed, delivered, and improved.

Learning Through Pathway Level Transparency

When outcomes and costs are made visible at pathway level, healthcare teams gain a shared factual basis for learning. Differences in practice can be discussed in terms of results rather than opinions. Improvements can be tested and followed over time.

Some interventions may increase costs while delivering substantially better outcomes. Others may reduce costs without harming results. Both types of insights are essential to managing care responsibly. By organizing measurement around medical conditions rather than departments, responsibility for outcomes and costs becomes shared across the full care pathway.

Managing Care as a Long Term Investment

By following outcomes and costs over time, healthcare organizations can treat care as a long term investment rather than a series of isolated decisions. Health economic models help make the consequences of different choices visible and comparable, supporting decisions based on measured results rather than expectations. Some parts of care may become more costly while others become less expensive, but these trade offs can be understood and assessed over time.

The aim is a healthcare system that delivers better patient centered outcomes at the right cost, creating value for patients, professionals, and society.

Ensuring Credibility and Trust in Long Term Value Assessment

To support credible learning and decision making, health economic models need to be defined in advance and applied consistently over time. Assumptions, cost components, and outcome measures must be transparent and traceable to the underlying data. This ensures that observed changes reflect real improvements or trade offs in care delivery rather than shifts in methodology.

By using reproducible models that are followed longitudinally, organizations can compare results over time with confidence, build trust among clinical teams, and create a shared factual basis for improvement and investment decisions.

This creates a practical foundation for improving care based on systematically measured outcomes and costs, supporting better decisions over time.