Do Patient Outcomes Trump Good Business Principles and Management?

Value Analysis Committee

Robert W. Yokl, Vice President/COO, SVAH Solutions

Sometimes the tough questions that people ask about value analysis decisions can be summed up in a simple client instance that tells the story perfectly while answering the question with professionalism, efficacy, and integrity. Below is a simple circumstance that answers this ongoing question in my eyes.

I will always remember one of the first meetings for a large health system’s new clinical value analysis team that our firm had set-up, trained, and coached. There was a presentation for a new ostomy attachment system that was being pushed by the Wound Care/Ostomy Nurse Manager. She was really selling it in the name of better patient quality and outcomes, and this new ostomy product did not cost a lot of money (approximately $16K annually). While she was making her presentation and case for change, I asked the Director of Purchasing, who was the champion of the product currently being used, if the current ostomy product was inadequate and needed to be replaced. He stated that the same Nurse Manager who was  pitching the new product made the presentation and pitch no more than six months prior for the current ostomy product which she in turn had gotten  accepted and the product was contracted for and implemented. Now, six months later, she wanted to go back to the product that she had replaced.

The problem was that the hospital signed a two-year contract with a new ostomy vendor based on her fervent backing of this product six months prior. The Ostomy/Wound Care Nurse Manager was asking the value analysis team to break off the existing contract which still had 18 months left to run and start a new contract with the old vendor in the name of better patient quality. In further examination, both products met the  functional requirements for the ostomy care of the patient, but the new system required three additional small steps on initial set-up that the nurse did not anticipate. She felt it made the patient feel uncomfortable waiting while these steps were performed to set up their ostomy system. The products cost almost exactly the same, so cost was not an issue.

The challenge for this new product and the Value Analysis Team Leader, who was a Nurse Manager of a clinical unit at the hospital, was not whether this product was better than the other but whether patient quality and outcomes were enough to break a contract that the health system already had in place.  A contract that was negotiated in good faith with the vendor. Plus, this was one of the first meetings of their clinical value analysis team in their revised value analysis program and would set an important example moving forward.

The team leader who, being a nurse manager understood both sides of the equation, decided that it was not in the interest of their health system to operate outside of the realm of the good faith that they had developed with their vendors.  She further stated that it would set a bad precedent if the new clinical value analysis team started breaking contracts with their vendors and that they would more than likely suffer penalties for breaking these contracts in the future. She then did not reject the new ostomy product but recommended that the Wound Care/Nurse Manager make her request closer to the end of the existing contract which she accepted.

To me, this is why value analysis is more important than ever before to patient quality and outcomes.  Why? Because the hospital value analysis team leader was able to ask the right initial questions to ascertain that there was no risk to the patients or outcomes with the incumbent product.   Further, the team leader realized that other than a small inconvenience on set-up, it was not worth breaking a contract and all the ramifications that go along with breaking a contract.