A practical framework for achieving value creation and capture in healthcare through process improvement

Abstract

PurposeThe purpose of this study was to examine the concept of value in healthcare through a practical appraisal of the applicability of a conceptual framework, which is aimed at supporting the measurement and realisation of financial benefits from process improvement (PI) activities in a hospital setting.Design/methodology/approachA single case study of a hospital system in Melbourne, Victoria, Australia, was used to assess the applicability of the framework. The study sought to verify the framework's intention, that PI methods could be used to address known wastes that contribute to the cost of providing healthcare. The case study examines the current approach taken by the hospital to measure and realise financial benefits from PI activities and compares these to the components of the Strategy to Balance Cost and Quality in Health Care framework to assess its applicability in practice.FindingsThe case study revealed that the steps described in the framework were fundamentally in place albeit with some variation. Importantly, the case study identified an additional step that could be added into the framework to support hospitals to better define their portfolio of initiatives to deliver value. The case study also clarified three types of contributory elements that should be in place for the application of the framework to be successful.Practical implicationsThe Framework to Achieve Value in Healthcare is offered to hospitals as a model by which they can look to reduce expenditure through the removal of non-value adding activities. The modification to the conceptual framework has arisen from a single case study and would benefit from further testing by other hospitals in other policy settings (i.e. other countries).Originality/valueThis is the first paper to examine and enhance an existing framework to assist hospitals balance cost and quality through PI.