Defining Provider Value Based On Audience

In an era when every word seems to be parsed and examined in the “what does this mean to me?” microscope, a word like value is one which is interpreted in many ways by many people. When used in the context of health care, attitudes and the “value of value” becomes less clear-cut, based on audiences, and within those audiences, different substrates.

The three major audiences in the health care arena today – payers, physicians and hospital/system providers – are all as worried about health care costs as American leaders and citizens, but come at the challenge with different attitudes and understanding. And each of these audiences has many sub-audiences, hence the advice: when communicating about costs and talking about “value,” never assume and drill down with each audience via research to identify awareness, understanding, acceptance, and positive/negative impressions, attitudes and more. Don’t speak until you know what your audience already thinks.


The audience most likely to understand what the word value means in health care – and to be positive about efforts to deliver value – are the payers. CMS, insurance companies, state and federal Medicaid programs, and individual consumers who pay for their own insurance, are most likely to pay attention to “what it cost,” and the be equally well versed in the “cheap” versus “good price for good product” nuance.

Consumers don’t like feeling that they are now going to be pushed to the doctor or hospital that has the lowest prices, so addressing those concerns by emphasizing quality (such as avoiding infections), and describing patient service and satisfaction as a co-equal goal along with value and cost effectiveness, can help reduce anxiety.Click To Tweet

While payers watch prices – what they are actually charged by providers – and aggressively pursue payment based on efficiency, they increasingly make it clear to consumers that they are doing their best to negotiate and insist that hospitals, doctors, pharma companies and others do their best to be cost effective. That last phrase has become increasingly important in health care as the link between quality care and positive outcomes has become clearer, and the payers more definitively understand that simply slashing costs to provider cheaper care may not deliver better outcomes. Doing it more effectively and more efficiently is now more accepted as the foundation of value, so a provider that offers the lowest bid may end up being the most expensive as mistakes, re-admissions, infections and complications result in increasing the total cost of treatment. So with payer audiences, the multi-faceted message is centered around value and costs, but not without consistent references to quality and outcomes.


Physicians, who bear ultimate responsibility for the care and well-being of their patients, have long understood that quality care will ultimately be the most effective, leading to better outcomes. And if forced to “choose one” they routinely choose quality over cost, because their oath is to do no harm to patients and focus on achieving the best possible outcomes. With this audience, value is a keyword, but it is on an even part with language about costs.

And some physicians are learning to adapt their methods of practice to deliver a good outcome at lower-cost outcome to payers and negotiate a reliable value-based standard rate of compensation that give physician practices consistent payments and a stream of patients who are encouraged by insurers (and patients with high deductibles) to carefully consider the costs of procedures.


The most complex audience, not surprisingly, are consumers. Since the managed care era bloomed in the 1980s, with a cacophony of opposition from traditional medicine, charges and counter-charges that included “HMOs save money but reducing care and cutting costs that result in patient problems”. Since that time, skepticism has continued to exist. In patient/consumer focus groups across the country, a general discussion of the concept of value is usually fairly positive until the word “value” is introduced. Often the first question/statement by a consumer is a variation on “what are they doing to get those lower costs – cut MY care?”

There is also concern that the word “value” is a placeholder for cheaper care achieved by cutting quality, reducing access, denying tests and treatments. “If they offer you ‘value’ care,” said one consumer, “you know what you are getting is second rate or second best – which might be OK if you are having routine care,” and a fellow focus group participant countered, “If it’s your health or your life at risk, do you really want the cheaper alternative?”

So with consumers, when using the V word in discussing the concept of value or introducing the concept of reduced or stable costs, it’s essential that the word “value” is used carefully and modified to offer reassurance to consumers. Currently patient choice of a hospital provider is already limited to varying degrees by physician preferences and insurance coverage.

What’s in a name? When it comes to discussing the dollars and cents value of health care, the words we speak and don’t speak can make a critical difference.

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