Governance: Maintaining a focus on value

Governance: Maintaining a focus on value

In a value-based organization, excellence is planned, rather than accidental, thanks to a strong culture of measuring outcomes, and a commitment to quality at every level, not just among individual clinicians or quality managers. Where several institutions form part of an integrated care network (such as an accountable care organization), this commitment must be present across every entity, with managers providing the appropriate organizational and clinical governance.

Related content

Baby lying on bed in hospital

Governing a system differs from governing an individual hospital, as the network must often accomplish a variety of objectives through several different organizations, all operating within a rapidly changing healthcare and regulatory environment. With multiple parent and subsidiary boards, it is essential to arrive at a unifying definition of the integrated system that is shared by all the boards and associated members. Many successful healthcare systems have reduced autonomy in their subordinate boards, and given greater authority and accountability to the system board, including oversight of quality and patient safety.

One of the mantras of effective, value-based organizations is: centralize authority and decentralize decision-making; leaving more granular decisions to appropriate subordinate boards. For example, the system board would set the policy for quality and the strategic direction for the entire system, while specific decision-making responsibility for medical staff would rest with individual hospital boards.

Clinical governance levels can vary widely, depending upon the formality of the structure and the relationships within the integrated care network. As health systems evolve, organizations and individuals follow a journey. From a position of high individual autonomy, health professionals start conforming more closely to rules and guidelines. Continuous improvement and accountability become part of the culture, with a rising awareness of the need to deliver value across the care continuum – and not simply in single interventions. Measuring and monitoring become second nature, as the different providers work closely together to address agreed segments of patients, with clear outcome targets such as reduced readmissions, shorter hospital stays and lower costs.

At the highest level of maturity, high-value care may be achieved either through vertically integrated health systems, or alternatively via clearly defined contracts between contractors and subcontractors. In cases where public or private healthcare organizations subcontract care to providers, hospitals or practitioners, intermediate contracting bodies can assume responsibility for the key outcomes. Day-to-day goals will remain the domain of the subcontractor.

Integration is by no means a prerequisite for quality; too much integration can lead to virtual monopolies that force up prices and breed more bureaucracy. Certain types of patients are best served by dedicated groups of specialists in areas such as hip or knee replacements, cancer or elderly care, contracted to deliver ‘meaningful units of care.’

Care pathways cover the entire patient experience as he or she moves through the system, with an emphasis on prevention and wellness through care in the community. Well-coordinated teams are responsible not just for their own areas of treatment, but also for the ultimate outcomes.

Asking tough questions – Georgina Black, Partner, KPMG in Canada

Boards are ultimately accountable for the performance of an organization and its employees, and should not hesitate to question management about the decisions they are taking and their performance, including:

  • Who is accountable for oversight of quality and patient safety?
  • What mechanisms are in place to ensure that management produces appropriate and accurate information?
  • What are stakeholders’ expectations of quality and patient safety?
  • How does the organization, its staff, patients and the community define quality and patient safety?
  • What metrics are used to measure progress towards quality goals?
  • Does the organization have the skills to achieve its quality objectives?

Lessons from Sweden – Prof. Jörgen Nordenström

International rankings, national polls and surveys both tend to look favorably on the Swedish health system. Sweden offers arguably the best model of how a local authority-led approach could be structured. It has over 70 disease and patients registries in place, containing outcome measures that enable comparison between (groups of) providers – including primary and community care – and different regions. Prof. Jörgen Nordenström, professor of surgery at Karolinska University Hospital for over 15 years and author of the recently published Value-based Health Care: are we as good as we can be?, shares four practical lessons from his research and experience with organizing value-based healthcare.

Use structure and process measures to compliment outcome measures

Outcome measures by themselves do not provide the full story. If you want to organize value-based healthcare, you need to understand what is causing good or bad outcomes of care to identify improvement areas. This requires the identification of measurements of process and structure that are closely linked to measurements of outcome.

Be your own fiercest competitor

Urge care providers to be their own fiercest competitor. Demographic differences, socio-economic status, specific local circumstances, quality of primary care providers in the region or availability of community services, can distort comparisons between providers and regions. Instead, compete with yourself over time to improve your results every month and year.

Commit to continuous improvement, adhere to evidence-based best practices

Karolinska University Hospital uses effective lean production techniques to systematically improve disease pathways. Find the tools and techniques to support a commitment to improvement befitting your organization then make sure you adhere to evidence-based best practices. The latest best practices should be the standard you adhere to and the starting point for the next round of improvements.

Communicate in terms of quality

Organizing value-based healthcare needs to be underpinned by a fundamental belief that increasing care quality leads to reduced overall costs. All changes need to demonstrate improvements to quality, access and affordability of care. A compelling story about change conveys that message to engage patients, staff and other stakeholders to help drive change.

What Works – As strong as the weakest link

Creating value-based healthcare organizations – rethinking value.

Read more

Connect with us


Request for proposal



KPMG's new digital platform

KPMG's new digital platform