Preoccupation with creating value in health systems has been longstanding, but the focus has usually been on certain stakeholder perspectives and/or certain dimensions of value

Health systems around the world have long sought to create as much value as possible out of their available resources. This preoccupation will likely only intensify, given the ongoing strains on health systems, such as population ageing, other underlying global trends, such as technological innovation, and the occurrence of shocks, such as the global financial crisis of 2007–2008 and the current COVID-19 pandemic, and their effects on the resources needed to deliver health care and on national budgets.

The development of concepts such as value-based health care or patient responsiveness are two examples among many of the efforts at creating value in the health system. Yet, these various initiatives have usually approached the notion of value from the viewpoints of a limited range of actors in the health system and/or have focused on certain dimensions of value. These limited perspectives inhibit progress towards maximizing the total value that could be achieved by the health system.

Understanding of value should be consistent amongst all actors and aligned with the overarching goal of maximizing societal wellbeing

In this policy brief we thus put forward a practical policy framework that seeks to reconcile the various contemporary approaches towards health system value. We define value to be the contribution of the health system to societal wellbeing. The distinctive contribution of this concept of value is that we focus on the value created by the health system as a whole, including health promotion and disease prevention functions. We are thus moving beyond value-based health care towards the concept of a value-based health system.

While there is no universally agreed definition of wellbeing, it is increasingly recognized that more tangible elements, such as health, education, employment and housing, and less tangible elements (such as social belonging) all contribute to our wellbeing. However, regardless of the precise formulation of the concept, health, and by extension health systems, are consistently included among those elements that make a substantial contribution to wellbeing.

Health improvement, responsiveness, financial protection, equity and efficiency are widely accepted as health systems’ core contributions to societal wellbeing

There is a core cluster of objectives that has secured widespread acceptance amongst health policy-makers as reflecting many of their central priorities and therefore core elements of value: health improvement, responsiveness, financial protection, equity and efficiency. In particular, universal health coverage (UHC) is intended to make important contributions to wellbeing in a number of dimensions and is therefore likely in most countries to be central to the health system’s concept of value.

Beyond these core objectives, health systems also contribute to societal wellbeing indirectly via the spillover effects that their actions have on other sectors, such as through the positive effects of good health on educational attainment or labour force participation.

The different dimensions of value can be ultimately translated into benefits and costs

Health systems generate value by creating health and non-health benefits that contribute to wellbeing. These benefits should be examined in relation to the costs they ultimately incur (e.g. in the form of taxation or direct payments), which detract from wellbeing. In this sense, the concept of health system value is closely aligned to the concept of health system efficiency.

Collectively, inefficiencies in the health sector can be thought of as waste, which some commentators have estimated to account for 20-40% of health spending. This waste destroys value, either by precluding spending on more valued health system activities, or by diverting expenditure unnecessarily to the health system and thus preventing the creation of wellbeing by other sectors. Indeed, empirical evidence shows that there are large variations in amenable mortality (which can be seen as a proxy for effective and timely health care) between countries with similar levels of spending and some of this variation can be ascribed to inefficiency and waste.

Different actors within the health system make partial contributions to value; to maximize value, these contributions should be aligned

Health systems are shaped by a wide array of actors, including national policy-makers, purchasers, providers, practitioners, citizens and patients. While each of the actors in the health system should contribute in some way to value, most of them, by the nature of their roles, can only make partial and specific contributions. For example, a prime goal for purchasers should be assuring allocative efficiency, while the central focus of citizens and patients should be on health improvement. National health policy-makers, by determining the shape of the health system, contribute to all dimensions of health system value. They can also contribute to health improvement achieved by policies that are outside health sector’s core focus, by cooperating with other sectors. They make a key contribution to value by defining, through democratic processes, what value means in its specific national context and ensuring that it is transmitted to all actors in the system and taken into account in all policies.

A range of policy levers can be used to enhance value; while they normally focus on one or two dimensions of value, it is important to ensure that other dimensions are not undermined

Health systems can choose from several policy levers to promote various concepts of value, including:

1. working across sectors for health
2. fiscal and regulatory measures for health promotion and disease prevention
3. strengthening primary health care
4. funding health care for universal access
5. setting a health benefits package
6. strategic purchasing for health gain
7. paying for quality
8. integrated people-centred health services
9. evidence-based care
10. stepping up the introduction of eHealth and digital health
11. involving patients in their own care
12. involving citizens in decision-making.

These levers typically focus on a limited range of actors and only one or two dimensions of value. It is therefore important, when taking a holistic view, that they do not detract from attaining other dimensions, or inhibit other actors from doing so. For example, the prime focus of clinical guidelines is improving health. However, if guidelines do not incorporate the patient perspective, they might undermine responsiveness. If they do not consider the cost of care, they may have an inadvertently negative effect on efficiency. Most levers will affect and will be affected by several actors and will have an impact on other levers too. For example, the use of eHealth may provide ways of enhancing several levers such as involving citizens in decision-making, paying for performance, and integrating health services. It is thus important that a unified concept of value is taken into account when aligning policies.

Effective governance of the whole health system is needed to ensure that stakeholder perspectives and policy levers are aligned to promote a common concept of value, and that the levers work as intended

There should be appropriate instruments in place to promote, monitor and rectify any shortcomings in securing value, either by institutions or policies. Each accountability arrangement between the various actors in the system should be based on clarity about what aspects of value it is seeking to address, how that contribution is conceptualized and measured, and what mechanisms are in place to correct perceived shortfalls in the creation of value. Achieving this is not straightforward, but frameworks such as Transparency, Accountability, Participation, Integrity and Capacity (TAPIC) offer potential tools for designing and auditing the effectiveness of accountability relationships.

It may often be necessary to move towards value-based systems gradually, focusing first on the areas where it might make the biggest difference

It may not always be possible or desirable to seek immediately to apply a value-based approach throughout the health system. It may instead be necessary to move incrementally towards value-based services, focusing first on the areas where it might make the biggest difference, such as mental health. Yet it is important to formulate an explicit concept of health system value and translate it into a set of concrete goals that all actors can understand, and progressively move the system closer towards attaining them.