For many healthcare professionals, “value” is a loaded word. We may want it to refer to components of care delivery or a patient’s care experience, or use it to describe a future where all healthcare dollars are efficiently allocated. But the reality is that for many it connotates oversight, risk of reimbursement penalties, and administrative burden.

How did we get here? It all started innocently enough. Articles exploring the appropriate threshold for healthcare spending to save a  life appeared in the 1970s and 1980s (and probably before that), and calls for strategies to control the volume of fee-for-service spending began in the early 1990s. Obviously, the movement toward value-based care in public policy is linked to the 2010 Affordable Care Act and the 2015 Medicare Access and CHIP Reauthorization Act (MACRA), which mandated the establishment of an incentive program linking reimbursement to quality metrics. Unfortunately, “value-based care” is now synonymous with “quality measure performance-based reimbursement” and is essentially an extension of the notion that value is simply quality per dollar spent. The 2010 New England Journal of Medicine article often considered the genesis of that phrase has been cited over 4,500 times.

But, let’s back up. Value, in general, is subjective. It depends on the point of view and the situation, and is driven by the metrics used and the data available for its evaluation. In short, it’s complicated. The idea that we could (or should) ever try to reduce it to a single, universal definition is ridiculous. Frankly, as an industry we need to move forward toward a more sophisticated approach to value.

Why is the oversimplified definition of value as quality per dollar spent a problem? There are a few reasons:

  1. It’s limiting. You cannot talk about the value of care without answering the question “Value to whom?” The same intervention or change in policy will have different value for patients than it does for providers or payers. It is impossible to identify one universal and all-encompassing “value” of a quality improvement initiative. Doing so minimizes or dismisses non-monetizable forms of value, like peace of mind, hope, and equity (even though there are peer-reviewed studies demonstrating the value of each).
  2. It’s uninformative. When national quality monitoring programs began using measures like 30-day readmission rates and 30-day mortality rates, there was a myriad of publications challenging the intent, definition, or calculation of those measures. Clinicians, advocates, and researchers raised issues of attribution, validity, and appropriate comparisons across hospitals. In each case, however, they had to assume something about the underlying premise and objective of the measure and the program it was a part of. Therefore, a primary issue with many value-based measures and programs is an inexact or unspecific definition of value: it is unclear from whose perspective the programs are attempting to create value or what components are being considered as contributing that that value. Without that information, we are left to suppose and presume what the intent is in order to evaluate whether it is successful in achieving the (assumed) objective.
  3. It’s not helpful. The oversimplified definition of value does help patients select good care (for a number of reasons), nor does it help clinicians deliver care or administrators make decisions about their facility. In fact, as an industry we struggle to find a consistent and helpful method to assess value. In a 2019 systematic review of 38 articles, the authors identified “22 distinct approaches to assess value of healthcare interventions.”[1] Unfortunately, they concluded that the most common method among them (cost-effectiveness analysis) “has not been sufficient to meet the needs of decision-makers.” What does that say if not that there is a breakdown in the most fundamental axioms of how we think about value in healthcare?

Clearly, we need to shift our thinking. We are too heavily invested (mentally, emotionally, and financially) in the aspirational goal of promoting and supporting value in care to not demand a more comprehensive and universal approach for assessing value that is relevant for anyone who claims to have an interest in improving care and patient outcomes. Current policy, opinions, research, and the strategies of for-profit payers all point to a future where care is chosen, delivered, and paid for within a value-based framework. Yet, as an industry we have no shared vernacular for how to talk about value; our opinions differ on how value should be defined, measured, quantified, and compared. And, as indicated by the review mentioned previously, our current methods are insufficient to meet our needs to help us decide where to place our efforts and our resources.

The reality is that there is no universal definition of value. Instead, we need to have a structure or a framework for how to consider value for a given situation and to accomplish specific goals.

I propose that in each situation, we need to:

  • Define what value means for that scenario: this involves identifying the perspective (value to whom?), the scope (timing, target population, etc.), the goal or objective (what decision will this inform), the assumptions being make, and the intended audience.
  • Specify the costs, benefits, and metrics: Identify the sources of costs and benefits, determine how each will be quantified (and monetized, if necessary), establish the level of attribution they have to the intervention, product, or service, and then consider the metrics to use and how they will be compared and to what.
  • Interpret and communicate the results: place the results within the larger context of the goals and motivations for assessing value, consider both monetary and non-monetary value, combine technical results with practical realities, describe new learnings, and indicate what’s needed going forward.

In a general sense, this type of framework can prompt individuals and organizations to specifically state:

  1. “Here’s what we believe constitutes value in this situation, and for whom,”
  2. “Here’s how we will measure, quantify, and evaluate that value,” and
  3. “Here’s what our findings mean.”

Given the variety of motivations, audiences, perspectives, and types of value that exist in healthcare, our best way forward is to adopt a consistent method or framework for assessing value instead of trying to establish a universal definition of value.


  1. Seixas BV, Dionne F, Conte T, Mitton C (2019) Assessing value in health care: using an interpretive classification system to understand existing practices based on a systematic review. BMC health services research 19 (1):560. doi:10.1186/s12913-019-4405-6