Health and Healthcare Systems

Data and trust: the two pillars of value-based healthcare

Value-based healthcare, emphasizing patient outcomes, is a solution to current over-burdened health systems.

Value-based healthcare, emphasizing patient outcomes, is a solution to current over-burdened health systems. Image: Getty Images

Christophe Weber
President and Chief Executive Officer, Takeda Pharmaceutical
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This article is part of: World Economic Forum Annual Meeting
  • Value-based healthcare, emphasizing patient outcomes, is a solution to current over-burdened health systems.
  • Data governance establishing standardized collecting, reporting and analyzing would put patients at the centre of decision-making.
  • Trust is vital for ensuring the responsible use of data.

The world is changing rapidly. Economic pressures, climate change and geopolitical risks have intensified consistently for years, contributing to uncertainty and a tough global economic environment. Then layer in advanced science and new digital technologies, like generative AI, that are enabling us to rethink much of what we do and how we do it – bringing both challenges and opportunities.

And at the same time, we’ve seen a massive demographic shift as the world’s populations continue to grow and age with rising life expectancy, due in part to the advances in medicine and science that would have been unimaginable 50 years ago. In fact, healthcare costs have been outpacing GDP growth, furthering resource constraints and financial strain.

Despite all of these changes, healthcare systems in developed countries have remained largely unchanged since they were first established primarily in the 1940s and 50s. Their creation was a watershed moment for human health. But today these systems are outdated and unsustainable, struggling to meet the needs of larger and older populations, despite there being more medicine and treatment options available and more advanced technology. The COVID-19 pandemic accelerated this crisis and brought many European healthcare systems to the brink of collapse, while other public-private systems such as the US experienced increasing health inequities.

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We believe a solution for these challenges is moving away from current fee-for-service healthcare models and toward value-based healthcare; an approach that pays for patients’ outcomes and care quality rather than administrative volume. According to a 2016 estimate, transforming the US healthcare system to be focused on outcomes could reduce the average annual increases in healthcare costs by up to 30%.

Patients would benefit from a system set up to deliver results for them, and efficiency and burn-out on the delivery side would likely improve as a result of linking the incentive to outcomes rather than volume. A value-based system also encourages continued funding to fuel the scientific breakthroughs of tomorrow.

However, we need to be realistic. The scale of such a transition sounds daunting and, in many ways, it is. That’s why our first steps in healthcare transformation should focus on two primary enablers of value-based healthcare: governance for real-world data collected via digital technologies and trust.

Establishing data governance

As we continue moving towards a reimagined future fueled by data and digital technologies, it’s time for healthcare systems to do the same.

We’re already experiencing an explosion in the quantity of data generated every day. Further, reports estimate that 30% of all world data is generated by the healthcare industry, and it is increasing faster than any other field.

These trends hold promise, but the problem today is that data is not well managed or well used. In most healthcare systems, data is dispersed among doctors, hospitals, patients and others – making it difficult to fully understand how patients are doing. Many health systems lack a clear analytics strategy, and as of a 2019 estimate, 97% of all global data produced by hospitals each year goes unused.

While some progress has been made in that time, we need a way to report, collect and analyze standardized health data so that patient outcomes become the basis for decision-making. Think reimbursement, funding, prescribing – all decisions that would be better rooted in data and aligned with the goal of driving better health for patients. This is at the heart of value-based healthcare.

For example, the Health Outcomes Observatories (H2O), a project run by a consortium of 25 entities in public and private sectors, puts this concept into practice. Several leading hospitals in Europe are on a journey to make standardized patient outcomes a core element of the conversation between patients and doctors, with the resulting data becoming part of real-world data libraries.

Value-based healthcare is grounded in trust

Healthcare is complex and, at the same time, it is deeply personal. To honour this, trust should be prioritized as another condition required for success in healthcare transformation.

Importantly, trust is earned only through actions and behaviours. It takes time to build, effort to keep and can be lost quickly. When it comes to data governance, trust means keeping the patient voice and experiences in the centre of reporting, analyzing and decision-making by providing the infrastructure and framework for the responsible use of data.

This underscores the importance of collaborators coming to the table with authenticity and empathy, recognizing that while we don’t know everything, we can ground ourselves in data-driven decisions. Focusing on generating and sharing solid data at every step of the way from clinical trials to patient experiences – helps all align on the true meaning of value for patients.

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What is the World Economic Forum doing to improve healthcare systems?

Building trust amid these challenges we face today is not easy. But it is our collective responsibility to empower patients and reimagine solutions that will better support the rapid changes occurring in society.

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