From Volume to Value

What’s needed from today’s value analysis professionals
By Cindy Christofanelli, RN, MSN, CMRP

As our healthcare system evolves to one in which payment is linked to the clinical outcome of services instead of the volume of procedures performed, we are clearly at the precipice of a game-changing event. This transition from “volume to value” will result in revolutionary, not evolutionary, change in the way traditional supply chain functions and activities are performed in our organizations.

Value analysis will be a critical strategy to embrace the challenges ahead. It will assist healthcare organizations in making decisions that not only impact their own financial health, but more important, the clinical outcomes and health of the patients they serve.

More and more healthcare organizations are employing value analysis professionals with in-depth IT knowledge, who can apply knowledge often developed outside of healthcare, according to a recent survey by the Association of Healthcare Value Analysis Professionals. Successful prospects for this role may come from a computer programming, mathematics, or engineering background.

No time for rework
One reason is that as healthcare organizations focus on expense management, the ability to “do their homework” has to be accomplished in record time with a high level of accuracy. With healthcare reform looming on the horizon, providers are challenged to change and improve faster. Healthcare organizations across the country – whether they self-contract, use the services of a GPO, or fall somewhere in between – are faced with the fact that every year, hundreds of their agreements expire or call for tier adjustments, or utilization patterns have shifted such that agreements need to be reexamined.

In many cases, this reexamination involves simple math. Historically, though, healthcare organizations have engaged in an intense amount of rework and essentially reinvented the wheel in the contract and value analysis review process. It would not be unusual in a multihospital system using traditional value analysis/contract review processes for “the math” and the “clinical acceptability assessment” to be redone three or four times in a typical contract review. It is examined at the GPO level, the corporate level within a large system, the regional level and, in some instances, the individual hospital level. Healthcare organizations cannot continue with this type of rework.

The value analysis professional must be adept at analyzing and manipulating massive amounts of data from multiple disparate systems. Today, much of the data on utilization and outcomes is in an electronic format, so it can be analyzed and manipulated. The value analysis professional or team can see the organization’s spend as well as what needs to be done to change it. IDNs have to have access to staff with advanced database, analytical, and mathematical skills. Software packages available from GPOs, consultants and service providers can aid in this process.

Needed: Value analysis practice standards
How can IDNs change? Creating key practice standards around the value analysis process is a start. And the time is now. Development and communication of agreed-upon professional standards by which healthcare value analysis is performed is critical. Currently the Association of Healthcare Value Analysis Professionals is creating a Professional Practice Standards Committee, which will engage thought leaders across the industry for this exact purpose. AHVAP – whose mission is to provide and promote processes and information to assist value analysis professionals in evaluating healthcare services for clinical quality and cost effectiveness – is embarking on this journey to define and put in place the necessary structures and processes to guide the healthcare value analysis process.

AHVAP’s vision is to assure that value analysis is recognized as an essential component of the delivery of healthcare, and for AHVAP to be nationally recognized as the preeminent clinical resource in providing education, resources and networking to its membership and to promote value analysis in the healthcare community. The role and work of the newly formed professional practice committee will be key in achieving these goals.

Recently AHVAP expanded its membership criteria to include organizations involved in value analysis services, such as consultants and employees of group purchasing involved in value analysis. This is a critical and important step in the evolution of value analysis for the healthcare industry. In addition to the work AHVAP is doing, Premier has engaged value analysis leaders from across its membership to participate on a Value Analysis Advisory Council to provide a platform upon which Premier will partner with members to establish the framework for best practice value analysis.

AHVAP and others recommend that organizations have value analysis steering committees that operate at a high level in the organization, so that tough decisions can be made, barriers to implementation removed and projects monitored for successful clinical and financial outcomes. Other key components of a successful value analysis model outlined by AHVAP include:

  • Executive engagement and participation.
  • Physician engagement and participation.
  • Stakeholder engagement and participation.
  • Goal alignment and linkage to strategy/vision.
  • Structured process to secure data.
  • Project management to define timelines.
  • Use of benchmarking tools and information.
  • Tool(s) to trend, track and document outcomes.
  • Systematic process to communicate results to all levels of the organization.
  • Access to staff with deep analytical and clinical skill sets.

To be sure, value analysis professionals won’t do their work in isolation. Value analysis teams must include end users, who can help define the specifications upon which product decisions and judgments are made. Clinicians can help develop tools to accurately and efficiently mine the organization’s data on utilization and quality. They know products and equipment, the questions that need to be answered, and the “math that needs to be done.” The analytical specialist has the expertise to perform this analysis quickly. There will also likely be much closer involvement and collaboration with finance as organizations try to decipher the overall cost of care and how shrinking reimbursement will impact the bottom line and how improved outcomes affect overall performance.

Interpersonal skills are critical as well. If physicians are not involved in the value analysis process, they may feel that something is being done “to them,” or that they’re being singled out. It’s always important to keep in mind that what is said is often not as important as who is saying it. Having a physician champion on hand during value analysis discussions can help. Sometimes physicians perceive the message differently if it’s coming from one of their peers.

Planning a meeting before the meeting to carefully script the information to be presented and who will present what is essential. Debriefing after the meeting to define what went well and what could be improved is also helpful to improve the communication process. For value analysis professionals, clocking some “face time” outside the contract cycle is important, rather than showing up simply when they need or want something. It helps to build rapport.

Cindy Christofanelli, RN, MSN, CMRP, is corporate director supply chain management, SSM Health Care, St. Louis, Mo. She is central director of the Association of Healthcare Value Analysis Professionals and chair of AHVAP’s newly formed Professional Practice Standards Committee. She is also chair of the Premier Value Analysis Advisory Council.