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Action points for pioneers

III.Action points for pioneers

This section analyzes why the change to value-based healthcare is a huge opportunity for all stakeholders in the health system. We also look at what changes are required from different stakeholders.

The most strategic decisions are made by government-level actors such as public servants and politicians. Governments have the most effective means to improve the healthcare system and population health at the broadest scale. The move towards a value-based system will not happen unless we reallocate spending, reimbursements, and public procurement. Demonstrating healthcare’s current emphasis on “reactive sick care”, even emerging and innovative industries such as digital health focus mainly on management of diseases rather than preventing them.

Source: Digital Medicine

Here, funding for prevention includes various preventative healthcare services (school health services for instance). Detection is used interchangeably with the word diagnosis. (Disease-)Management refers to treatment, care and rehabilitation. US Figures.

System-level change

The state is a big beneficiary of better population health over the longer term. Healthier citizens are happier and more productive, as well as being active constituents of their communities. The optimal method for approaching complex issues such as population health requires broader collaboration in public administration and a systemic approach. Governments are increasingly interested in phenomenon-based administration to break silos and advance towards comprehensive, cross-sectoral policies and budgeting.

At the grandest scale, social scientists and decision makers have explored holistic approaches to healthcare and population health using concepts such as “health in all policies”, where each new policy is evaluated through the lens of the impact it will have on public health. As an example of this, a city government can weigh the health benefits of investing in bicycle lanes, or a lawmaker can enact punitive taxes to curb the use of sugar or trans-fats. Health system leaders might benefit from society-centered design methods that reach beyond the individual and consider society at every step of the problem-solving process. It is an approach that is intentional about topics such as citizen empowerment, civic commons, public health, equity, and the planet.

One important issue is the allocation of resources. OECD countries currently allocate less than 3% of their health spending on average to public health and prevention activities, even though some 80% of premature heart disease, stroke, and diabetes deaths could be prevented as they are linked to risk factors such as tobacco use, poor diet and physical inactivity (both strongly associated with obesity), excessive alcohol consumption, and uncontrolled high blood pressure. Focusing on preventative healthcare is in no material way different to requiring car passengers to wear a seatbelt, which is nowadays taken for granted as it has proven to be very effective in preventing injuries or even death.

By channelling additional resources to under-financed preventive services, the advancement of value-based healthcare can also accelerate new sources of funding. An example of this is an emerging form of innovative finance solution called impact investing that we covered earlier in this course.

Social and healthcare reform in Finland

Finland is undergoing social and healthcare reform which will change the organizational structure significantly. The reform, if eventually passed by parliament, shifts the responsibility for organizing health and social services from municipalities to regional government level counties, which are funded by the government. In the future model, municipalities remain responsible for the wellbeing of residents and the promotion of health. The reform’s goal is to ensure that everyone in Finland has equal access to high-quality health and social services.

Related to the reform, the Finnish government published a route map to value-based steering in early 2020.

To achieve its goals, the government plans to strengthen basic public services (primary care) and preventive work. Steps towards this are currently being made in the national Future Health and Social Services Centres program, the purpose of which is to establish health and social services centres with wide-ranging services. The program will also support a user-oriented approach to health and social services and accelerate utilization of digital and mobile services.

Sharing best practices, incremental changes, and applying technical innovation are not enough. More radical and systemic innovations are needed to achieve value-based healthcare’s potential or it will be difficult to move the system from its current unsustainable path. This will require risk taking and a huge amount of learning to make it happen. Value-based healthcare is still a relatively new field and there is a lot of exploring to do going forward. Payers and the wider ecosystem will need to invest resources in experimenting and learning the benefits and best practices of a value-based approach. A natural role for governments is to engage in dialogue with stakeholders, facilitate and support collaboration across sectors as well as regions, and to build awareness and share risks with the ecosystem.

Most importantly, value-based healthcare calls for a new mindset from healthcare stakeholders and their leaders. Patients, especially those with complex needs, typically encounter a “one-size-fits-all” care model that fails to take individual goals for care into account. This is due to the current output-focused, “inside-out” approach to healthcare. In a value-driven system people are active stakeholders in making decisions over their own health and services are designed “outside-in” to meet the needs and expectations of service users in order to achieve the best possible care outcomes.

The future health system calls for leadership that understands accountability and engages with a broad range of stakeholders, not the least of which are the healthcare professionals. This kind of “horizontal” leadership requires humility and a mindset shift from telling to asking, trusting, innovating, and collaborating.

By promoting accountability instead of outputs, the focus moves to outcomes and societal impact. This means the health system empowers the broad ecosystem (including payers, providers, NGOs, and citizens) to find and develop the best possible solutions required to achieve jointly defined goals. We might envision that when value-based healthcare concepts are taken into use and the incentives are aligned properly, the health system will start to “self-correct” on all levels by, for example, innovating on quality rather than just on effectiveness of service provision – so-called process learning.

But learning needs to happen on an individual level as well. The current wave of innovations in education are also relevant to health professionals. In recent years, for example, massive open online courses, or MOOCs, have democratized learning globally, with MOOCs provided by, for example, Coursera, MIT–Harvard edX, and others capturing a lot of attention. But most importantly, the education of health professionals must reflect the changing environment and be adjusted towards continuous, life-long learning goals.

Organization level, roles, and key responsibilities

To cover the broad range of different stakeholders in the healthcare ecosystem, we have divided organizations by their function and roles:

  • 1) Payers who are responsible for funding healthcare for individuals. In the current Finnish system, municipalities have a central role in financing healthcare and ensuring quality, including health outcomes of the population
  • 2) Providers who are responsible for offering and developing health services to citizens
  • 3) The solution ecosystem that in this context covers NGOs, pharmaceutical companies, diagnostics and health technology providers, startups, and other important solution providers

1) Payers

The clearest benefit value-based healthcare brings to a payer is cost savings. More precisely: payers pay for good outcomes – such as a healthier population or better disease management – rather than services and transactions with little value.

To capture this benefit potential, payers (such as municipalities in Finland) need to step up. Payers need to take a proactive leadership role and steer the system in a more sustainable direction. This will require multi-stakeholder collaboration and setting clear, jointly defined goals for the ecosystem that delivers healthcare. Platform thinking and sharing-economy approaches are a useful mindset for optimizing resource use and channeling resources across regions and sectors. Payers need to be in a leadership role as they hold the power to make change happen in a sustainable way.

By advancing an incentive and information structure that aligns everyone’s focus on outcomes and delivered value, payers create pressure on service and solution providers to develop a strategy that transcends traditional cost reduction and responds to new, outcome-based payment models.

“Fit-for-purpose” procurement or collaboration models need to be considered as well. To find new ideas and innovations, instruments such as innovative outcome-based procurement, innovation partnerships, and health/social impact bonds should be considered.

Source: Calvi et al. 2020

Payers need to utilize outcome-driven thinking while choosing the right procurement or reimbursement model. The more familiar and narrow the problem is – and when there is existing technology or solutions – then traditional procurement processes are suitable. But the more unexplored the territory – and if there is a need for more radical innovation – then exploration in terms of research, experimenting, and co-creating is needed.

Here are examples of the procurement or partnership tools available, depending on the need payers have:

  • Incremental innovation is a series of small improvements or upgrades made to a company's existing products, services, processes, or methods. This means that changes implemented through incremental innovation are usually focused on improving an existing process or service and its efficiency.
  • Technical innovation is the process of implementing and developing new ideas such as technology into a more productive way of operating. Technical innovation results in lower production costs or greater value added. Lower production costs can arise from better production processes.
    • Example: Innovative public procurement, such as an innovation partnership model, to develop new technology based on the needs of the public sector
  • Market innovation means improving the mix of target markets and the way in which they are served. It refers to things like delivering existing therapies or services with outcome-based pricing, instead of volume-based.
    • Example: An alliance model in which multiple organizations share risks and benefits
  • Radical innovation focuses on revolutionary service models and shaping unexplored, new markets. Unlike incremental innovation, radical innovation replaces the existing system or process and replaces it with something entirely new.
    • Example: Impact investing is an innovative funding structure in which private capital shares risks and aims for positive societal change and the co-creation of innovative, outcome-based service models.

Source: Based on: Ansoff, I.H and Ringberg et al. 2019

To summarize, a concrete toolbox for payers to improve the value and efficiency of care might look something like this:

  • Have a vision and define a population health strategy in which population segmentation is a key component. For example: the whole population (area), sub-population (people with a long-term condition), and high-risk population (people likely to develop a chronic disease).
  • Utilize data and knowledge management to gather insights into those populations and tailor the service portfolio based on their needs. Data is obviously not enough for value-based healthcare transformation – in addition there is a need for quality registries and universal standards of care, as discussed in Chapters 2 and 3.
  • Develop a portfolio approach – in addition to general health services offered to the whole population, ensure fit-for-purpose services by enabling more tailored patient pathways and precise interventions for specific patient segments.
  • Allocate more focus and resources on preventive healthcare by investing in the prevention of diseases. Experiment with new value-based models through outcome-based purchasing and contracts. Utilize innovative finance structures such as impact investing to pilot and accelerate market access for more radical innovations
  • Increase payer collaboration by removing payer/regional silos, collaborating around a shared mission (such as the prevention of chronic illnesses), combining resources, and knowledge sharing. This will accelerate change in scale and increase the broader real-world value of innovations.

Emphasise provider accountability for outcomes – digital and low-cost service models (such as social prescriptions) are being innovated by not only public sector providers, but by tech industry players, NGOs, and private sector companies as well. Publicly funded services need to keep up with the pace of the private sector’s innovation capability. This will require a new kind of innovation toolbox and a mindset that is more open and collaborative, particularly because of limited resources.

2) Providers

Providers of the future will see themselves as platforms who “own the whole patient” or partner with other such platforms to create modular offerings with specialized value propositions. In service modularization, larger service entities are broken down into smaller subservice modules with standardized interfaces that enable the mixing and matching of services according to customer needs.

In brief, providers are accountable for health outcomes, a role that is quite different from their current one. Value-based healthcare has a vested interest in promoting patient health because better health lowers total costs over time – in other words, as healthcare providers are directly rewarded for outcomes, they have a direct financial interest in engaging with people to motivate them to take better care of themselves outside of a clinic or a hospital.

Outcome-based business or service models will require ecosystem and citizen-centric thinking. As incentives are linked to health outcomes on a population level, providers have a clear incentive for continuous improvement and to utilize the approaches to disease prevention and management that will have the largest impact.

As lifestyle-related diseases are a big cost factor and affect the life quality of a large share of the population, future health services will also need to address the crucial role of lifestyle change. Services will be holistic in nature and support will be tailored to patients’ overall circumstances, which means understanding the social determinants of health as well.

For example, initiating behavior change calls for a toolbox that expands outside the typical clinical offering: it will include health coaching, online peer-support, electronic reminders, and even food interventions. This means that in the future, the provider’s ecosystem may consist of non-traditional players such as grocery stores and gyms. As with payers, a multilevel strategy (whole population, sub-population, and risk groups) is important to ensuring the offerings and service allocations are fit-for-purpose – and to maximize the value created for payers, society in general, and most importantly citizens.

It’s important to keep in mind that lifestyle choices are personal and the risks associated with poor diet or low physical activity are genetically predisposed as well as a matter of individual choice. People also take other risks, such as downhill skiing or speeding while driving, fully aware of the potential consequences. This needs to be recognized to avoid patronizing people, which is counterproductive.

Case example: Food farmacy, Geisinger Health, USA

Geisinger Health patients that have HBA1C levels greater than 8 and suffer from food insecurity (a household's inability to provide enough food for every person to live a healthy life) are referred to the Fresh Food Farmacy program.

In the program, patients attend an evidence-based weekly diabetes self-management program and are offered a suite of wellness offerings. They also have access to no-cost, interactive nutrition and wellness education classes held by dietitians and health coaches. Program partners offer grocery store tours and cooking demonstrations. Every week patients receive enough food to prepare healthy and nutritious meals for their whole family, twice a day for five days (10 meals per week). On average, this means feeding a household of four, including two children.

So far the results have been promising: Claims data from the pilot project shows that costs for pilot patients dropped by 80%, from an average of $240,000 per member per year, to $48,000 per member per year.

In primary care, healthcare providers will have multidisciplinary teams organized to serve segmented groups of citizens – which in practice means people with similar care needs. The approach to care design will be “outside-in”, resulting in a more citizen or patient-centric approach. This is especially true for those patients with long-term chronic conditions (diabetes, heart disease) and elderly patients who require more targeted and tailored services. To achieve optimal health outcomes, different patient groups will be assigned different teams and service types, sometimes even in different locations or service channels. These will be optimized continuously, based on care results and patient needs.

The new role and operating model of providers – in which the provider covers the whole range of interactions with a patient, including coverage, care, and administration –  is enabled by digitalization and big data. To achieve a full 360-degree picture of a person’s wellbeing and health, healthcare providers will need to combine data that is currently in silos. Therefore, interoperability has a vital role to play in enabling more personalized – even predictive – healthcare.

More broad access to healthcare data and advanced analytics tools can guide the precise orchestration of services – in other words how and what care is provided to whom. With vertical integration – when entities at different levels of the healthcare supply chain collaborate – providers may reduce costs while improving outcomes and the overall experience for patients.

Outcomes-based incentives can help lead to a holistic, comprehensive, and  people-centered approach to delivering services. Depending on the defined outcome targets, in some cases dental health might also be part of integrated services to prevent dental disease or other illnesses related to poor oral health.

When looking into the range of possible futures, one trend seems quite obvious: Providers will invest more in holistic approaches to care. This means new ways of enabling better health outcomes, including activating local communities, increasing access to healthy food, and supporting an active lifestyle. Services and partnerships expanding “beyond healthcare” will therefore be a central part of a provider’s toolbox in the future.

A broader ecosystem

Shifting healthcare budgets to these new “value pools” creates new markets for care innovations. By crafting outcome-based business models and ecosystems (ecosystem in this context is the open network of organizations – including healthcare providers, customers, competitors, government agencies, and so on – involved in the delivery of healthcare) there is significant value-generation potential for solution ecosystem players. Value-based healthcare will create new markets that are currently largely unexplored.

Consulting firm PwC expects that by 2030 up to $4.4 trillion of global healthcare spending will move to diagnostics, digital health, and advanced prevention options, with more investment in personalized therapies and preventive and early stage drugs.

In addition, a relevant healthcare ecosystem for the future will be expanded significantly. Achieving better outcomes will take a partnership approach that takes into account community groups, government, universities, employers, and technology companies. Governments will have a role in adopting policies that encourage change.

Addressing the social determinants of health requires collaboration within and across sectors

Source: PwC

The more aligned payers and governments across the world are in their approach to value-based healthcare transformation, the more pressure we will see for the solution ecosystem to find collaborative, outcome-based approaches to care. One attractive opportunity is to focus on certain sub-segments of a population to tailor a holistic solution portfolio for them that also delivers a better user experience. One example of how tailoring of services can work is a service called Suuntima. Suuntima is operated by Pirkanmaa Hospital District in Finland and it features surveys a patient fills in together with a doctor. Survey results help the patient to understand their condition and the best available options, while also helping doctors to better understand the individual needs of their patients.

Healthcare ecosystems of the future will be centered on the patient

Source: McKinsey & Company

Providers might focus on managing the care of a whole population and then build partnerships with platform companies who focus on specific sub-segments. For example, pharmaceutical or medical technology companies can generate new revenues from expanding their current core business (product sales) towards a more service-oriented offering, making outcome-based partnerships with providers (or sometimes directly with payers). By combining complementary solutions like digital therapies from their network as well as utilizing global networks and deep knowledge of a certain disease area, pharmaceutical and medical technology companies are well-positioned as key players in the emerging outcome-based market.

Most likely, providers will also be challenged by new entrants such as big technology players like Amazon or Apple that are already investing quite significantly in healthcare-related activities.

Big tech healthcare investments by sector over time

Source: CBInsights

New consumer-facing digital health offerings are also emerging. One interesting group of solutions is digital therapeutics, which encompass a wide range of product types. They include smartphone apps, wearable devices, and remote care platforms. All these types of solutions can help drive clinical outcomes, but to make the most of their potential they should be integrated into the standard care model. Value-based reimbursement will accelerate the utilization of these solutions, due to their digital nature. This makes them easily scalable and cost efficient.

Landscaping of digital health solutions

Source: Simon Kucher & Partners

The third-sector and civil society can also play a leading role in securing the wellbeing of citizens. Third sector organizations are key enablers of peer support that is an indispensable part of current healthcare – and will be even more important as we move towards a value-based system. Citizen engagement helps payers and providers to create relevant and inclusive health-related programmes and policies. Particularly when social determinants are emphasized, third-sector organizations will have a critical role. New innovative service approaches, such as “social prescriptions”, represent an area in which third-sector organizations are core players, providing community services and activities that otherwise wouldn’t exist.

To capture the potential that digital advancement has to offer, third-sector organizations need to consider building partnerships with external organizations. Due to limited resources, utilizing open innovation, cross-sectoral partnerships, and existing communication channels that citizens already use such as social media or SMS, third-sector organizations can secure societal impact in a cost-efficient way.

3) Individuals

Healthcare professionals

Shocks like the coronavirus pandemic pose severe threats to healthcare systems and  heighten already existing fiscal pressures and scarce government resources. Healthcare systems do not have enough healthcare professionals or resources to provide care in the current way, and transformation is needed. This unsustainable situation is tightly linked to emerging phenomena such as physician and nurse burnout described in the earlier parts of this chapter. To solve these challenges, we need to redesign the way healthcare is provided, including new approaches to talent management and human resources.

Health systems need to encourage health professionals to participate in the discussion about healthcare’s future as well as take responsibility and feel accountable for promoting more people-centric and value-driven care. Professionals are close to people and they are valuable members of an innovation ecosystem. By enabling more self-managing teams, bottom-up innovations can be accelerated. But without aligning with their employers’ – healthcare providers – incentives towards value-driven models of care, professionals have very limited opportunities to apply new care models.

Achieving the goals of value-based healthcare requires resources to be transferred from low-value to high-value care.

Based on the success story of the Netherlands-based home care company Buurtzorg, giving more power to professionals leads not only to better care results and cost-efficient operations, but also to higher employer and customer satisfaction. This is most likely the case in other healthcare contexts and with other professionals as well.

Case: Buurtzorg and self-managing teams

Buurtzorg Netherlands employs more than 10,000 nurses and assistants in 850 self-managed teams of 5 to 12 professionals that provide a range of personal, social, and clinical care to people in their own homes in a particular neighbourhood.

Each team can be reached 24/7 by clients and potential clients and is taught how to organize permanent accessibility for clients, doctors, and hospitals. Once registered, clients no longer have to deal with an ever-changing collective of carers from a big organisation, but in principle get care from a small number of professionals (1–5). The intention is to combine the interests of patients and professionals. Cooperation with other neighbourhood professionals like doctors is important. Buurtzorg's model has resulted in cost savings as patients only use 40 percent of the care that they are entitled to instead of the sector standard of 70 percent.

The nursing teams have a flat management structure, working in “non-hierarchical self-managed” teams. Teams have access to a coach that focuses on enabling the team to learn to work constructively together, as well as a central back office and digital tools.

Even though self-managed working does not suit everyone, Buurtzorg’s staff have awarded Buurtzorg an 8.7 for general satisfaction and a 9.5 for staff involvement. Since 2011, Buurtzorg has won Best Employer of the Year in the Netherlands four times.



To ensure health professionals have the opportunity to actively participate in healthcare’s transition journey from volume to value, they should be better equipped with knowledge about the value-based paradigm and the latest technological innovations. More cross-sectoral knowledge exchange is also needed as digital transformation brings new types of professionals closer to clinicians’ everyday work.

In addition, new forms of education (like MOOCs) enable new and more democratized ways of learning, but more focus and resources are still needed to support continuous development among professionals. As the saying goes, “knowledge is power”. Without understanding the key concepts of prevalent trends or emerging paradigms, professionals are left out of this much-needed dialogue. Together with citizens and patients, health professionals represent the most valuable part of the system – we cannot afford to leave them aside, rather the goal should be that change is driven by empowered pioneers in the field.

New emerging professions in healthcare (health coach, link workers)

According to the OECD, automation will lead to significant workforce disruption across sectors. However, the replacement of workers by machines seems least likely in healthcare. That said, healthcare workers will likely still see changes in their tasks that are difficult to automate, including ”creative and social intelligence, teamwork, and other ‘soft’ skills”.

Digitalization offers a change to improve care through better use of data and by supporting care workers in tasks that are repetitive and time-consuming, which includes such things as identifying irregular results from tests and combining information about a patient from multiple sources (OECD, 2019). Machine learning and artificial intelligence are also already surpassing humans in the ability to analyze genetic data or images such as radiological images, which can help support medical personnel in their tasks. In addition, we will most likely see new professions that may focus on supporting other health professionals in applying data (like genomic data) in everyday care.

Jobs most and least likely to be automated

Source: OECD

In the future, care will be provided by a cross-disciplinary team of professionals including physicians, nurses, dentists, psychologists, genetic specialists, social workers, and new emerging professionals such as health coaches or “link workers” (EU, 2019). Roles such as care or service managers will most likely be needed as well. They will focus on optimizing the individually tailored service portfolio as well as engaging actively with the citizen or patient. For example, a US-based health insurance company provides each customer with a concierge team that actively communicates and engages with them as well as orchestrates services to optimize care outcomes.

Case: Link workers

One example of a new role in healthcare is the so-called ‘link worker’. Link workers support and motivate individuals to address their long-term conditions and improve their quality of life. In the Ways to Wellness program in Newcastle, UK, link workers provide services for patients with long-term conditions to help them manage them. Such support includes encouraging patients to:

  • Adopt a healthier lifestyle including more exercise, a better diet, less alcohol, and quitting smoking
  • Get access to health services that support treatment for their condition
  • Get involved with local groups that can offer support through socializing and being more active
  • Offer support for areas of their life that cause stress and worry, such as financial difficulties

Citizens

Digitalization is driving change in the expectations of citizens. Now we are all more used to smooth and easy-to-access services, this affects our expectations of publicly funded services as well. The number of digitally savvy citizens is continuously increasing and today the majority of citizens have smartphones. This enables broader use of digital services in healthcare. Most recently, the coronavirus crisis has accelerated the use and acceptance of digital health solutions among citizens. This change in consumer behavior will enable new service models like proactive remote care and coaching.

What needs more consideration in the future is health data and who owns it. Currently individuals’ health data is mainly managed by organizations rather than individuals themselves, and without breaking data silos it is impossible to orchestrate the care ecosystem towards the best health outcomes. But from the perspective of privacy, combining data from multiple sources isn’t sustainable unless people have the power to consent to the usage of data. People need to be seen as active participants, not objects, in the data economy and especially in data-driven healthcare. The citizen should be in the driver’s seat, with professionals having the role of trustworthy companions and coaches in guiding them towards better health.

Globally speaking, citizens are also becoming active consumers of health-related products and services due to increasing digital offerings and well-being being a major driver in consumer decisions. Unfortunately this will also lead to widening gaps between population groups, unless the publicly funded system can renew itself. However, it is promising that people are interested in prevention and their wellbeing – citizens are currently the most common purchaser (instead of healthcare providers or payers) of prevention-focused digital health products and services.

Especially younger generations believe that technology must play an essential role in the future of healthcare – and given that people between 15 and 30 years of age make up nearly a quarter of the world’s total population, this is not insignificant.

Technology can, if applied wisely, be not just an enabler of faster access to services or cost efficiency, but also a driver of ethical and widely acceptable societal change.

One might say that citizens are also the most underused resource in current health systems. As people, families, and communities play a key role in managing their own health and wellbeing, promoting peer support is a significant opportunity to make providers accountable for health outcomes. Peer support typically involves the sharing of knowledge, experience, or practical help with each other. Many voluntary and community groups (maintained by NGOs or the fourth sector) encourage peer support. Health and social care commissioners are beginning to recognise the potential benefits.

The emergence of platforms like Patients Like Me showcases the potential power of unorganized civil activity to help health systems empower patients and the potential that bottom-up participation has to offer.

Peer support is a vital element for outcome-oriented health systems. Especially among people with long-term health conditions, peer support has been able to not just improve the patient experience but also improve health. outcomes and lower the costs of care. Based on the research by National Voices and Nesta, the most promising forms of peer support appear to be:

  • face-to-face groups run by trained peers which focus on emotional support, sharing experiences, practical activities, and education
  • one-to-one support offered face-to-face or by telephone
  • online forums, particularly for improving knowledge and anxiety
  • support offered regularly (such as weekly) for three to six months

Key findings about the impact of different types of peer support

Source: National Voices and Nesta 2015

Engaging citizens in managing their health and being active members of their community requires more than just lower barriers to services. The Finnish system has extensive municipal autonomy (it has been called the “most decentralized one in the world”), which helps to bring decision making closer to citizens.

Digital transformation is not enough without structural change that aligns everyone’s focus on outcomes. Therefore incentives should steer all stakeholders to put more focus on earlier parts of the health continuum as well as empowering citizens and patients to take an active role in their own healthcare. Instead of being passive subjects, citizens should be seen as active participants and we should promote practices and language in healthcare that supports this transition. This requires not just new incentives and information structures, but cultural renewal as well.

The ethics of value-based healthcare

Healthcare ethics emphasize respect for life, promoting health, alleviation of suffering, treating and caring for the patient regardless of circumstances, and respecting their rights as patients. The main challenges arise from changing societal structures. Ethical problems related to a physician’s work can be caused by inadequate healthcare resources and sometimes by pressure from patients and their relatives. Time limits mean that caregivers experience difficulties in doing their work as well as they would like to. To ensure individual and population health, the main ethical considerations are avoiding harm and trying to do good. Equal access to care should be ensured, regardless of background factors.

Many ethical dilemmas become apparent with an aging society. With age often come sickness and disabilities, meaning a population’s need for health services and various therapies increases as people live longer. Determining the need for healthcare is complex – ethically and otherwise. Determining health and disease are no easy tasks. Should individual and population health needs be determined by an expert, the individual or population, or together?

Health systems need to use their resources wisely and efficiently. However, two recent reports (2017 OECD report "Wasteful Expenditure on Health"; and 2019 European Commission “Defining value in ‘value based healthcare’ Report of the Expert Panel on effective ways of investing in Health”) emphasize the costs of inappropriate treatment and wasted resources. A significant amount of health care spending is related to inefficiency and waste. All healthcare systems are under pressure to adapt to rising costs associated with increasingly aged and diverse patients, increasing public expectations, innovation in medical technologies, and changing clinical practices. The reports present alarming data on inappropriate treatment and wasted resources. In practice this means a focus on prioritization is needed.

Cost-effectiveness is often emphasized in the debate about prioritization. Prioritization requires as much evidence as possible about the impacts (benefit and harm) and costs of healthcare activities. In practice, this information is usually incomplete. In addition to cost-effectiveness information, it’s important to identify and accept that values, ethical principles, and available resources always influence decision-making. Prioritization must not be based solely on the pursuit of the greatest possible individual benefit, because the issues of fair distribution of health care for the population will be forgotten. Medical research is the means to improve or increase the number of opportunities for disease prevention, detection and treatment. Globally, however, health budgets are under considerable pressure, which requires a focus on how to maximize the health benefits of the population in terms of available resources.

To ensure the financial sustainability of public health, a long-term strategy has been proposed to reallocate resources from low- to high-value care as defined in the Expert Panel on Effective Ways of Investing in Health (EXPH) concept. According to the EXPH recommendations, raising health awareness is an essential investment for creating an equal and just European society – and also important for promoting solidarity.

In medicine, ethical responsibilities have evolved over time. In Finland, physicians in their profession must undertake to act in accordance with the regulations approved by the Delegate Committee of the Finnish Medical Association.

Code of medical ethics (approved by the Delegate Committee of the Finnish Medical Association)

  • It is the physician's duty to uphold and promote health, to prevent and treat the illnesses of their patients and to alleviate their sufferings.  In all their work, the physician must respect life and humanity.  The physician shall never participate in torture, the implementation of a death sentence or any other inhuman actions or preparation thereof. 
  • The physician shall behave and act in such a way that the appreciation and trust placed on the medical profession needed for carrying out the duties of a physician are maintained. 
  • The physician shall treat patients as equals, with fairness and without discrimination.  
  • The physician shall respect the patient’s right to make decisions concerning their care and encourage the patient to participate in making decisions concerning their care.  Fulfilment of the patient’s autonomy shall be supported as far as possible, also when the physician is compelled to act irrespective of the patient’s will.    
  • A physician shall maintain and improve their knowledge and skills.  They shall use and recommend only such examinations and therapies which medical knowledge and experience have shown to be effective and purposeful. 
  • The physician shall support and promote scientific research within their field of expertise.  When carrying out clinical studies, the physician must follow the principles of informed consent and the other requirements laid down by the Helsinki Declaration.
  • The physician shall maintain confidentiality and promote the confidentiality of patient information.  
  • The physician shall treat the patient in accordance with the patient’s need of help and set their fee in accordance with the work performed.  A physician may not seek unfounded tangible benefit.    
  • When issuing certificates and statements, the physician functions as an impartial expert approved by society.  Their statement must be based on the objective findings of a thorough examination and on a critical evaluation of these findings and other background information.    
  • When appearing in public, the physician must observe strict consideration, avoid unfounded self-emphasis and show respect for patients. As a physician, they shall base statements on medical knowledge and experience.  
  • The physician shall act and work in a way that upholds and promotes collegiality to the benefit of patients and maintains the valuable spirit of collegiality and good comradeship.  
  • The physician shall actively pursue efforts that allow them to fulfill these duties and to follow these principles in their work.

Ethical guidelines for physicians and caregivers are universally applicable to all healthcare, including value-based healthcare.

Value-based healthcare has all the elements to make the vision we described earlier a reality. If well applied, value-based healthcare offers us a health system that is grounded on more open collaboration and dialogue. Change will occur top-down and bottom-up simultaneously, directed by a shared mission of a healthier population. It’s a system that puts people at the center, both citizens and professionals. At its core, value-based healthcare can offer healthcare that is more human.

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After completing Chapter 5, you should be able to:

  • Understand the central megatrends impacting health
  • Know what things to consider while designing a value-based health program



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