With one of the world’s most rapidly ageing populations and an ever-increasing burden of chronic illness, Singapore faces a healthcare cliff edge. Reflecting the demographics, healthcare expenditure has risen steadily to about 4.5% of GDP. Singapore now faces an inflexion point in its healthcare journey, with important choices to be made in tackling increasing demand in the face of escalating costs. Value-based healthcare (VBHC) is a powerful tool to address this burning problem.
VBHC seeks to optimise the use of available resources to improve health outcomes while lowering overall costs for healthcare systems. If correctly implemented, it offers enormous potential within Singapore’s healthcare ecosystem, streamlining service provision across providers and improving treatment decisions, cost of care, and ultimately outcomes for patients.
The concept of VBHC is not new to Singapore. In the Healthcare Industry Transformation Map released by the Ministry of Health, it acknowledges the potential of VBHC—outlining Beyond Quality to Value as a core strategy.
Singapore’s public health clusters have been making strides in the VBHC journey, launching pilots focused on select medical conditions and procedures. From relatively simple procedures like root canal treatment and hernia repairs to complex procedures like knee joint replacement and heart failure treatment, public health institutes have been implementing VBHC pilot programs to streamline care delivery and maximise clinical outcomes while lowering costs. In recent years, the private sector has also joined these efforts, with IHH Healthcare as an example rolling out VBHC efforts for knee replacement, colonoscopy, knee ligament surgery and angioplasty across its network hospitals.
Finding value in healthcare
This is indeed noteworthy progress. The challenge that lies before Singapore now is to apply the learnings from these pilots and rapidly implement VBHC at scale across the healthcare system. It is a daunting task, but an essential evolution of the vital healthcare industry.
A six-step treatment pathway for VBHC
While VBHC offers the potential to unlock multiple benefits, it remains an extremely challenging concept to execute, particularly at scale. Implementing VBHC is not a quickfix solution, but a holistic change that requires modifications to how healthcare systems define and measure success, the strategy to deliver care, and the way staff are skilled and trained.
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No country has yet been able to fully embrace VBHC across its national health system. Institutions that have taken the lead have encountered obstacles due to the traditional ways in which healthcare systems are organised, financed, and regulated. Singapore is no exception. In our view, there are six imperatives for Singapore to successfully deploy VBHC at scale.
First, develop a shared, system-wide VBHC ambition and cooperation mechanisms across healthcare institutions. This should include a commitment to transparently share information, adopt best practices, and align towards a VBHC transformation agenda. Establishing cooperation at scale will be critical to standardising care pathways, lowering system costs by volume consolidation, and laying the foundation for new, efficient and agile care delivery models.
Second, establish standard VBHC metrics and measurement mechanisms. ‘What gets measured gets improved’—transparent measurement of outcomes and costs is a foundational enabler of VBHC. The challenge is twofold. First, ‘What’ to measure? This requires an aligned set of outcome metrics and cost components for key treatment pathways. Second, ‘How’ to measure? This requires successful integration of disparate IT systems within and across hospitals, and smartly configured analytics to draw insights. A robust framework of metrics and agile information systems that identify treatment variations, root causes and action steps is essential. This will be a cornerstone of implementation for VBHC at scale, building the case for change with clinical staff, and monitoring progress against agreed-upon interventions.
Third, engage clinicians to drive systemic and cultural change. Medical professionals are best placed to drive the VBHC change agenda by leveraging their expertise and commitment to improving health outcomes. The most successful VBHC programmes let medical professionals take the lead while providing them with process support on non-medical tasks. Enlisting clinician support through the right reward and recognition mechanisms will be instrumental to scaling up VBHC.
Fourth, upskill and reskill the healthcare workforce. At-scale VBHC implementation will place a greater burden of delivering care on low acuity settings. Staff at community hospitals hitherto unused for providing step-down care to complex surgical cases will need to be retrained. Reskilling and upskilling nursing, paramedical, and clinical capabilities through appropriate rotational programs will be crucial to successful, at-scale VBHC roll-out.
Don’t forget it’s all about the patient
Fifth, it’s essential to take the patient along on this journey. VBHC is about the patient and must be implemented with the patient. It is important to put the patient at the centre of the decision-making. To foster the right mindset among all participating professionals, VBHC teams should have patient representation or engage directly with patients to understand the outcomes that matter most to them. Not only will this help healthcare systems gain valuable insights from patients’ points of view, but it will also ensure patient satisfaction and experience as VBHC is scaled up.
Finally, it is critical to resource this transition adequately through the right infrastructure, people, and governance. This could entail the creation of a central team that ensures alignment across Singapore’s healthcare institutions, provides quality control, shares best practices, and helps individual hospital teams drive the VBHC agenda. It will also require VBHC to become a key element in the governance of MOH, cluster level board meetings, and individual hospitals.
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Value-based healthcare has the potential to make Singapore’s healthcare systems future-ready. It offers a path to enhance patient outcomes, lower healthcare costs, and dramatically improve patient experience. This transition undoubtedly requires hard work and intensive efforts and will move forward one step at a time but it will enable a healthier healthcare industry that unlocks holistic benefits for patients, clinicians, and healthcare institutions.
Sumit Sharma is Southeast Asia leader for healthcare, managing director and partner, Boston Consulting Group. Dr Anurag Agrawal is partner and associate director, Boston Consulting Group
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