We conducted a poll in March to understand how our healthcare value analysis community defined a value analysis study. To our delight, 58% of the poll takers thought a value analysis study was an “in-depth investigation” (not a review, evaluation, or standardization) of a product, service, or technology. Happily, this was the right answer. Just as important as getting this definition right, an “in-depth investigation” value analysis study has three critical phases you need to know about. This way, you can continue to contribute to your healthcare organization’s bottom line. Now, let’s look at why this is important.
Product, Service, and Technology Evaluations Aren’t Good Enough
Hospitals, systems, and IDNs aren’t saving the dollars they used to on new products, services, or technologies they are buying. Therefore, value analysis professionals must mine other supply chain expense areas of their healthcare organization if they are to continue to contribute to their hospital, system, or IDN’s bottom line.
Remember, these new and better savings can’t be obtained through cursory evaluations or reviews of the products, services, or technologies you are buying now. It requires “in-depth investigations” to uncover the double-digit savings you have become accustomed to over the last decade. Yet, these double-digit savings can only be accomplished by employing the three phases of value analysis studies I’m going to talk about now.
3 Critical Phases of Your Hospital Value Analysis Studies
Every healthcare value analysis meeting agenda should have these three phases of value analysis studies incorporated into their meeting objectives:
- Prospective Phase: Look ahead to plan, source, and vet the products, services, and technologies that will greatly (5% or better than your current commodity being requested) improve your healthcare organization’s cost or quality. This should be one of the prime objectives of your VA program when a new requisition is presented for evaluation.
- Retrospective Phase: Look back at the products, services, and technologies that you have already bought to ensure that the promised savings or performance improvements have materialized. If not, it’s time to perform another value analysis study to bring your cost or performance in line.
- Troubleshooting Phase: Look at product, service, or technology failures as an opportunity to revisit a purchase that could have outlived its usefulness, appropriateness, or functionality.
What we are saying here with these three new value analysis study objectives is that a value analysis professional’s work is never done, since they need to be looking at the commodities they are buying now, those that have already been purchased, and troubleshooting products, services, and technologies that haven’t performed as promised.
Healthcare Value Analysis Is a Continuous Circle of Value Analysis Studies
You might want to think of value analysis as a continuous circle of prospective, retrospective, and troubleshooting value analysis studies to ensure that all your healthcare organization’s purchases are prudent, proper, and value-based. It’s not a one-time event. Once you realize this fact, your value analysis team’s contribution to your hospital, system, or IDN’s bottom line will grow exponentially without any other changes in your VA protocols. Wouldn’t this delight your senior management?