A custom collaboration with: Quintiles

The New Value Equation

Patients, payers, policymakers, providers and biopharmaceutical companies must interact to find real-world solutions

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The New Value Equation

America may be the land of the free, but not necessarily the land of the healthy—and certainly not the healthiest. According to the World Health Organization’s 2009 statistics, Japan can boast the longest healthy life expectancy, with an average of 76 healthy and productive years. U.S. citizens get just an average of 70 healthy years, leaving 30 countries ahead of them. The U.S. does, however, lead the world in the amount it pays for healthcare, a whopping 17.3 percent of the gross domestic product in 2009, according to the Centers for Medicare & Medicaid Services. As A. Mark Fendrick of the University of Michigan and his colleagues wrote in the December 2009 issue of The American Journal of Managed Care: “In short, we pay more than any other country for healthcare, but get less.” And that is no value.

To make tomorrow’s U.S. a healthier one, the healthcare industry as a whole—including drug and device makers, service providers, regulators and insurers—must find ways to improve overall value. As Fendrick and his colleagues note: “High-value healthcare has been defined as the right care to the right patient at the right time for the right price.” That multi-dimensional definition alone reveals the interactions necessary to bring more value to healthcare; indeed, all of health’s stakeholders must find ways to work together more effectively. The key question is: how can teamwork in this complex arena of health translate into value?

Improving healthcare demands innovation, but not just any innovation will do. It should be high-value innovation, which John Doyle, vice president and practice leader with the consulting group at Quintiles in Hawthorne, N.Y., defines as, “technology that makes a difference in real-world practice.” He adds, “The value is really a variable more than a fixed metric. It’s a function of who is using the technology and who derives value from it.”

In the past, many professionals in healthcare equated value with the amount that a payer would reimburse for a specific pharmaceutical product, medical treatment or device. But today’s healthcare value also depends on the perspective of patients, providers and healthcare policymakers. “Value will be measured differently by different stakeholders,” says Doyle. In fact, those different perspectives on value will grow even more important in the coming years, and every side will be looking for more powerful and accurate ways to measure healthcare value in the real world, rather than relying on some overly controlled aspects of past methods, such as placebo-based clinical trials.

The changing landscape of healthcare value, however, stretches far beyond the U.S. The demands for better health—improved outcomes, more economical treatments, advanced tools for diagnosis, techniques to improve adherence to medications and more—rumble in nearly every corner of the globe. Consequently, strategies to bolster value must investigate healthcare’s weak points at all stages—from birth to death, from drug discovery to treatment delivery—and build new and stronger approaches.

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