Bringing Value to Healthcare: Practical Steps for Getting to a Market-Based Model, 1st Edition (Hardback) book cover

Bringing Value to Healthcare

Practical Steps for Getting to a Market-Based Model, 1st Edition

By Rita E. Numerof, Michael Abrams

Productivity Press

322 pages | 11 B/W Illus.

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Hardback: 9781498735148
pub: 2016-02-01
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The healthcare sector is on the cusp of sweeping disruption. The hallmarks of the old system—pricing that’s disconnected from outcomes and incentives for treating sickness rather than maintaining health—are no longer sustainable. And yet, after decades of financial success, it’s difficult for most established industry players to grapple with meaningful changes to their business models.

In their latest book, Bringing Value to Healthcare: Practical Steps for Getting to a Market-Based Model, Rita Numerof and Michael Abrams lay out the roadmap to a healthcare system that is accountable for delivering optimal patient outcomes at a sustainable cost.

Based on in-depth research and decades of experience consulting with leading hospitals, insurers, and device and drug manufacturers, Numerof and Abrams provide a market-based approach to addressing the ills of the current healthcare system. In addition to highlighting industry challenges and opportunities, the authors also outline the changes required of consumers, employers, and policy makers to move to a patient-centered model characterized by value, accountability, and transparency.

This is the handbook for payer, provider, pharmaceutical, and medical device executives who are seeking to preserve today’s profitability while positioning their organizations for success in the very different markets of tomorrow. The book’s guidance is illuminated by case studies and each chapter concludes with a self-assessment tool and key questions.

Getting to a new future isn’t easy. But if it can’t be envisioned, it can’t be realized. Bringing Value to Healthcare is that critical first step.


"…This important workgets to the heart of the debate unfolding across the country and should serve as a blueprint for healthcare companies seeking to remain relevant…"

—Mark T. Bertolini, Chairman and Chief Executive Officer, Aetna

"…lasting change is really a matter of leadership. In this book, Rita and Michael describe the knowledge and actions needed from the board chair to the department head…"

—Joe Mott, Vice President, Population Health, Intermountain Healthcare

"No one can examine, investigate, study, discuss, and research the myriad of forces and role players in the healthcare arena better than the team of Rita Numerof and Michael Abrams. …a masterpiece for all stakeholders…"

—Robert Z. Gussin, PhD, Retired Vice President for Science and Technology, and

Chief Scientific Officer, Johnson & Johnson

"Bringing Value to Healthcare presciently describes a future where healthcare is hugely changed – and how we are going to get there."

—George C. Halvorson, Chair, Institute for InterGroup Understanding; Retired Chairman and Chief Executive Officer, Kaiser Permanente

"…this book is a must read for C-Suite healthcare executives who want to know how to survive and flourish when the payment models of the past are becoming increasingly obsolete."

—Paul Howard, PhD, Director and Senior Fellow, Center for Medical Progress, Manhattan Institute for Policy Research

"…Open and transparent health care markets are not only possible, but likely. And personal choice and real competition – not bureaucracy and regulation – will drive that transformation. Health policy experts Rita Numerof and Michael Abrams explain what is happening and why."

—Robert E. Moffit, PhD, Center for Health Policy Studies, The Heritage Foundation

"…Numerof and Abrams…illuminate the irresistible market forces that are finally taking the lead for the future of healthcare."

—Stephen B. Bonner, Member, Board of Directors, Former President, and Chief Executive Officer, Cancer Treatment Centers of America®

"…a map to the future of healthcare with instructions to help healthcare executives navigate the tricky terrain in front of them."

—Michael O. Leavitt, Founder and Chairman, Leavitt Partners; Former Secretary of the U.S. Department of Health and Human Services; Three-Term Governor of Utah

"Bringing Value to Healthcare is well researched …offers great information, insights, and solid recommendations. And, it’s well-written and very easy to digest."

? Fawn Lopez, Publisher and Vice President, Modern Healthcare and Modern Physician

"…a clear-eyed, unsparing analysis of the healthcare system… …intellectual fuel to jump-start this progress."

—Mary R. Grealy, President, Healthcare Leadership Council

"…[Numerof and Abrams] boldly remind us that we are either part of this transformation or a memory from the past."

—Esther Emard, Adjunct Instructor, The George Washington University; Former Chief Operating Officer, National Committee for Quality Assurance

"…a compendium on the state of American healthcare that is at once a timely snapshot of a dynamic industry, a critical analysis of the forces that are shaping change, a series of important practical strategic questions for each of the industry’s stakeholders and a reasoned, passionate call to action to assure that the trajectory of change in healthcare results in the hoped for benefits--assured access, affordable cost and high quality. …"

—Robert J. Laskowski, MD, MBA, Principal, Laskowski Advisors; Professor of Clinical Medicine, Thomas Jefferson University; President and CEO (retired), Christiana Care Health System

"The authors bring their vast experience and knowledge of organizations and public policy to advocate for important structural changes in our health care system…."

—Ellen Harshman, PhD, JD, Former Provost, Academic Affairs, Saint Louis University

"The authors do a terrific job of explaining and simplifying the dynamics created for all stakeholders when incentives are not aligned. …this book breaks down the issues and provides options and solutions that are needed to define a more efficient and effective system…"

—Gary P. Fischetti, Company Group Chairman, DePuy Family of Companies

"Numerof and Abrams effectively drive home the point that executives, including those leading major pharma companies, need to think more critically about the changes they need to make in order to survive in the future health care environment that is evolving very quickly. Indeed, ‘good science’ is a given but it won’t be sufficient going forward."

—Elizabeth J. Fowler, PhD, JD, Vice President, Global Health Policy, Johnson & Johnson

"…a fresh and critical view of healthcare reform that all providers, payers, and policy makers should have as a ‘must-read’ on their list."

—Bruce M. Gans, MD, Executive Vice President & Chief Medical Officer, Kessler Institute for Rehabilitation

"…While most commentators either say 'throw it out' (impossibly high switching costs) or 'live with it' (inefficient), authors Numerof and Abrams have, uniquely, proposed a highly readable roadmap for something right in between…"

? Alfred Lewis, Founder and President, Disease Management Purchasing Consortium International, Inc.

Table of Contents

A Vision for Tomorrow

Vision of a Fundamentally Different Future

Seeds of Disruption

Healthcare Isn’t the First Industry in Transition

Where Are We Currently?

Whose Agenda Controls Your Healthcare?

Why a Market-Based Model for Healthcare Is a Good Thing

How Did We Get into This Mess?

End of the Model Year

Understanding Healthcare Reform as Business Model Change

Central Role of Payment Reform

Unintended Consequences: The Hospital Example

Unintended Consequences: The Primary Care Example

Healthcare Is Big Business

Creating a Competitive, Functioning Market

There Is a Solution, and It’s Closer Than Some Think


In the Eye of the Storm: The Role of Consumers and Employers


A Personal Example

Shopping for Cancer Care: An Illustration

A Glimpse of the Business Model of the Future

Whose Agenda Controls Your Healthcare? Another Look

Perversion of the Concept of Insurance

New Sources of Competition for the New Consumer Patient

Transparency in Healthcare—Coming to Your Health System Soon!

Where Do Employers Fit into the Equation?

What Can Consumers and Employers Do?

Change Is Never Easy but Is Possible


The Role of Data: Creating an Environment for Change

Comparative Effectiveness Research: An Overview

Drivers of CER

Why Is the Federal Government Specifically Involved?

Focus of CER


Redesigning Healthcare Delivery: Hospitals Were Never Meant to Be Destinations of Choice


Adapting to the Changing Landscape of Healthcare

Shrinking Reimbursement and Pressure for Transparency Are Reshaping Healthcare Delivery

Accountable Care Is Needed; ACOs Are Not


The Next Chapter in Healthcare Delivery

At-Risk Contracting: The Next Step in Improving Quality and Reducing Cost

What It Will Take to Deliver Value Tomorrow

Competing with a Bundled Price

Building the Value Narrative for Consumers, Employers, and Insurers

How Should Hospitals and Health Systems Change?

How Is Value Defined?

The Future of Rural Hospitals: Are They Still Viable?


A Brave New World for Payers


Adapting to the Changing Landscape of Healthcare Insurance

Needed Here, Too: A Transfusion of Fresh Thinking

Rethinking the Customer

Rethinking Products

Implications for Healthcare Insurers

What Payers Can Do

Are You Ready for Disruptive Innovation?


Big Pharma: How to Regain Success


Sovaldi: Spotlight on Pharmaceutical Value

Vulnerabilities of the Current Model

Market-Driven Business Model

Pressures on Innovation

Role of Comparative Effectiveness in the Pharmaceutical Industry

Prudent Responses and Defensive Strategies

Looking Ahead


A New Day Is Dawning for Medical Device and Diagnostics Manufacturers

Getting Products to Market When Value Is the Focus

Evidence Requirements: The Threat for Medical Devices

Healthcare Delivery Pressures: Additional Threats for Medical Devices

Prudent Responses and Defensive Strategies for Medical Device Companies

Comparative Effectiveness: The Opportunity for Diagnostics

Prudent Responses and Defensive Strategies for Diagnostics

Where Do Medical Device and Diagnostics Companies Go from Here?


Putting Value at the Center of Healthcare

What Is the Legitimate Role of Policy?

Recent Legislative Solutions and Why They Won’t Work

Accountability for Care Is a Good Concept

Enabling Markets to Create Access to Care

Supporting Innovation: Finding the Right Balance at the Food and Drug Administration

Patent Life: Shooting Ourselves in the Foot


Creating a Roadmap for Change

Revisiting the Challenge of Industry Transition

Safety in Size? The Rush to Affiliation

Additional Challenges for Manufacturers

Reprising the Consumer

Creating and Sustaining a New Business Model

Harnessing Consumer Choice and Competition to Ensure Accountability: Final Thoughts for Policy Makers

End Game


About the Authors

Rita E. Numerof, PhD, president of Numerof & Associates, is an internationally recognized consultant and author with more than 25 years of experience in the field of strategy development and execution, business model design, and market analysis. Her clients have included Fortune 500 companies such as Johnson & Johnson, Eli Lilly, Pfizer, Westinghouse, AstraZeneca, Merck, Abbott Laboratories, major healthcare institutions, payers, and government agencies. The focus of her consulting addresses the challenges of maintaining competitive advantage in highly dynamic and regulated markets. Dr. Numerof graduated magna cum laude from the Honors College, Syracuse University, and received her MSS and PhD from Bryn Mawr College.

Michael N. Abrams, MA, cofounder and managing partner of Numerof & Associates, has served as an internal and external consultant to Fortune 500 corporations, major pharmaceutical and medical device companies, healthcare delivery institutions, the financial services industry, and government agencies for over 25 years. As an adjunct faculty member of Washington University, St. Louis and LaSalle College, School of Business Administration in Philadelphia, Mr. Abrams has taught MBA courses in strategic management, product planning and evaluation, quantitative decision making, and market analysis. Mr. Abrams completed his doctoral work in business policy at St. Louis University. He received his MA from George Washington University in Washington, DC.

Subject Categories

BISAC Subject Codes/Headings:
BUSINESS & ECONOMICS / Industries / Service Industries
MEDICAL / Administration