Do you know a good doctor?

Reference Value Model & Value Based Healthcare

"Do you know a good doctor?" a friend once asked me. He had been suffering from knee pain for days. I recommended an orthopedist who had helped me immensely.

Personal recommendations are often one of the most important reasons patients choose a specific doctor or clinic. A patient who has had an excellent experience often shares it within their circle of friends and family or online, thus enhancing the provider's reputation and credibility. But how can the value of such recommendations be quantified? Can recommendations and positive experiences even have a measurable impact on the quality of healthcare itself?

 Perhaps a look into marketing and customer management can help us answer these questions. Jens Cornelsen's Reference Value Model aims to measure the value of customer relationships through referrals and recommendations. Instead of focusing only on short-term revenue, the model assesses a customer's long-term value based on how frequently and successfully they make recommendations for the company. Key factors include leadership in opinion, social network, and customer satisfaction, which act as multipliers of customer value. This approach creates not only monetary value through direct sales but also a long-term "reference value" that can sustainably enhance a company's reputation and growth.

In 2006, Michael Porter and Elizabeth Olmsted Teisberg introduced a framework called Value-Based Healthcare. Its goal is to improve care quality while reducing costs by measuring success based on patient health outcomes. Patient experience and satisfaction play a central role here, as they are often indicators of a treatment’s success and sustainability.

Could these two concepts be combined?

 The Reference Value Model could be used in healthcare to systematically measure and enhance the economic and qualitative value of patient recommendations. Satisfied patients who have had positive experiences often serve as “advocates,” not only improving their own treatment outcomes but also strengthening other patients' trust in the healthcare provider. By adapting Cornelsen's Reference Value Model to the healthcare sector, the willingness of satisfied patients to recommend a provider could be used as a measurable value factor, supporting the long-term success and reputation of healthcare providers.

 Combining the Reference Value Model with the Value-Based Healthcare approach opens a new dimension of value creation that goes beyond purely medical outcomes.

 The key benefits include:

Promoting Positive Patient Experiences: Focusing on high-quality patient experiences motivates healthcare providers to prioritize patient satisfaction and well-being. This leads to higher adherence, better outcomes, and enhances overall patient benefit.

Building Long-Term Trust and Sustainability: Satisfied patients who experience value-oriented care have a stronger bond with their provider. They act as "ambassadors," fostering trust in others through their recommendations. This is particularly valuable in healthcare, where trust is a crucial factor in choosing a provider.

Efficient Resource Utilization Through Targeted Investment in Patient Satisfaction: By identifying which actions lead to especially positive experiences, healthcare providers can deploy resources more effectively. This saves costs in the long term while improving care quality.

 Integrating the Reference Value Model into the Value-Based Healthcare approach creates a framework that makes recommendations and satisfaction measurable, offering long-term economic and qualitative benefits.

 Combining the Reference Value Model with Value-Based Healthcare holds great potential but also faces specific challenges:

Data Protection: Collecting and analyzing patient satisfaction data and recommendation activities requires the protection of sensitive health data. Particularly in the EU, where the General Data Protection Regulation (GDPR) imposes strict rules, healthcare providers must ensure that patient data is only used anonymously and with explicit consent. Data protection is a fundamental prerequisite that significantly influences the scope of such approaches.

Role of Social Networks: Recommendations today often take place on social networks and online review platforms. However, the perception of such recommendations is influenced by factors like credibility and manipulation. Healthcare providers must ensure they find authentic and ethical ways to encourage recommendations without resorting to aggressive or manipulative tactics.

Acceptance and Integration: Implementing evaluation models in healthcare requires adjustments to existing processes and mindsets. Healthcare providers may initially hesitate to adopt such models, particularly when it involves monetizing patient satisfaction. Acceptance often requires a cultural shift and a willingness to question traditional evaluation approaches.

Combining the Reference Value Model with Value-Based Healthcare offers the potential to leverage recommendations and patient satisfaction as strategic resources.

By evaluating and fostering positive patient experiences, healthcare providers can strengthen their reputation and market position in the long term.

Satisfied patients who share their experiences contribute to value creation by enhancing adherence and trust in care. The model shows that value-oriented healthcare not only has economic advantages but also positively impacts patient loyalty and treatment outcomes.