How can health care organizations create value? Business model explorations

Abstract

Background: The Triple Aim posits that health care should strive to improve patient experience, improve population health, and maintain or lower costs. However, most organizations are not organized to achieve the Triple Aim. Attempts to improve the ability of health care organizations to deliver increased value through the introduction of management concepts, most recently Value-based Health Care (VBHC), have led to the emergence of a pattern of pseudoinnovation, where concepts are frequently replaced with similar content, but in new “packaging”. This suggests that organizations and their ability to adapt to their environment and integrate new management concepts could potentially be explored by looking at how the concepts themselves are understood and at how organizations deliver care. In management terms, the latter can be described as the business model (i.e., how an organization creates, delivers, and captures value).

Aim: The overall aim of this thesis is to understand how management concepts about value are understood and to explore how health care organizations in a publicly financed health care system are organized so that they create, deliver, and capture value.

Methodology: In Study I, citation registry data and literature were sequentially analyzed qualitatively and quantitatively to assess diffusion and understanding of VBHC as a nascent management concept in the literature. Study II, a systematic review, employed an explanatory synthesis approach to understand how business model frameworks have been applied in health care. Studies III and IV apply the Business Model Canvas (BMC) framework in a deductive content analysis of interviews with top managers (Study III) and with multiple data sources (Study IV) to conceptualize a hospital business model and to compare perinatal clinics’ business models in a publicly financed, Swedish health care setting.

Findings: VBHC and business model frameworks are commonly and increasingly used to improve value in health care. VBHC is superficially understood in the literature (Study I). Business model frameworks are primarily applied in e-health. They include a broad range of elements and have been used to identify essential elements, assess finances, and classify, analyze, develop, and evaluate organizations (Study II). Managers conceptualized the hospital business model differently, primarily related to customer segments. A tension between espoused and de facto value propositions was identified (Study III). Four distinct perinatal business models were identified within the same regional health system (New Thinkers, a Local Service Provider, Continuous Capacity Keepers, and a Hybrid) (Study IV).

Conclusions: The superficial understanding of VBHC and the ambiguity and lack of empirical data in business model applications risk diluting the potential benefits of both these management approaches. The multiple, co-existing business models within the same organization or health care system raise questions about how organizations are aligned and how we should view the role of different stakeholders in creating, delivering, and capturing value.