What healthcare gets wrong about value

Phil McEwan, CEO, HEOR

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When a healthcare system decides whether to fund a new treatment, the question it asks is almost always the same: is this technology good value for money compared with what we already have? It is a reasonable question, but also, in many cases, myopic.

 

At HEOR, we are aware that healthcare decision makers apply rigorous analysis within the confine of their remit and, as a result, can miss most of what really matters. The problem is not that those decisions are irrational. It is that the frameworks used to make them are structurally isolated.

 

The key challenge is that there is no single, unifying definition of value in healthcare. It depends entirely on who you are asking. A payer may be focused on managing the pharmacy budget. A clinician on outcomes for their patient. A patient wants the drug to work and not make them feel worse. All these perspectives are valid, but none capture the whole picture.

 

A new technology gets evaluated against the current standard of care, in a defined patient population, within a fixed budget horizon. What it does to hospital capacity in five years, or to a carer’s ability to stay in work, or to the downstream opportunity cost of a complication that never happens, is not considered in the calculation.

 

What we do at HEOR is build the whole picture. That means understanding not just whether a technology is cost-effective in isolation, but how its value evolves within a dynamic population, a changing treatment landscape and healthcare systems under pressure. As interventions and decision points invariably get looked at in isolation, it is important that decision-makers see the full spectrum of consequences of the choices being made now. That is the gap we work to close.

 

The current debate about GLP-1 receptor agonists, a class of weight loss drugs, is a clear example. The clinical evidence for their utility is compelling, and the cost-effectiveness assessments have been favourable, but payers are hesitating, because the eligible population is so large that the budget impact looks prohibitive.

 

That concern is understandable, but it is asking only half the question. One of the persistent challenges in healthcare is that we rarely think seriously about the cost of not treating someone, and that cost is often higher than the cost of treatment. Obesity is not a discrete condition, it is a driver of cardiovascular disease, kidney disease, liver disease, type 2 diabetes and a range of surgical ineligibilities.

 

Consider a patient who cannot have a knee replacement because their weight makes the procedure too risky. They are not simply someone waiting for surgery, they are accruing comorbidities, consuming primary care resource and potentially leaving the workforce. When viewed in that context, the weight loss intervention is not a treatment for obesity. It is a bridge to everything else. The value driver is not weight-loss for its own sake but enabling the outcome that was really needed.