Value-based health care

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Value-based health care (VBHC) is a framework for restructuring health care systems with the overarching goal of value for patients.[1] The concept was introduced in a 2004 article and 2006 book by Michael Porter and Elizabeth Olmsted Teisberg.[2][3] They described how health care had fallen into a pattern of dysfunctional competition where providers were competing on the wrong things at the wrong level. Outdated management practices and payment models made the problem progressively worse over the past 50 years despite tremendous advances in medical science. The result was that the US health care system was spending more per citizen on health care than any other nation and getting worse health outcome in important areas like newborn mortality.

Key concepts[edit]

Porter and Teisberg proposed that to achieve value for patients, health care delivery needs to be organized around the medical conditions patients have, accurately measure the outcomes that matter to patients, and measure the cost to achieve them. Payment should reflect value and not volume. Health care systems should integrate care across separate units and facilities in Integrated Practice Units (IPUs) and increase the geographic reach of leading providers in their areas of excellence. Information technology should support all of this, helping to restructure care delivery and accurately measure results.[4]


Although value based health care is seen as a priority in many health systems worldwide, a global assessment in 2016 found that the majority of countries are still in the earliest stages of aligning their health systems with the components of VBHC.[5][6]


  1. ^ Porter, Michael E. (2010-12-23). "What Is Value in Health Care?". New England Journal of Medicine. 363 (26): 2477–2481. doi:10.1056/NEJMp1011024. ISSN 0028-4793. PMID 21142528.
  2. ^ Porter, Michael E.; Teisberg, Elizabeth Olmsted (2004-6). "Redefining competition in health care". Harvard Business Review. 82 (6): 64–76, 136. ISSN 0017-8012. PMID 15202288. Check date values in: |date= (help)
  3. ^ Porter, Michael (2006). Redefining Health Care. Harvard Business Review Press. ISBN 9781591397786.
  4. ^ "Key Concepts - Institute For Strategy And Competitiveness - Harvard Business School". Retrieved 2019-08-09.
  5. ^ "Here's how to make 'value-based healthcare' a reality". World Economic Forum. Retrieved 2019-08-03.
  6. ^ "Value-based healthcare: A global assessment". Medtronic: Value Based Healthcare. 2016-05-12. Retrieved 2019-08-03.