He said that measurement and collection of data, integrating technology better into traditional systems and giving better information to consumers would assist driving better patient oriented outcomes.

“The way to transform the health industry is to realign competition so it’s based on value for patients, not just cost,” he said.

“Value for patients is equal to outcomes, divided by cost.

“If we’re to move towards value-based competition we must collect results, we must make them available and importantly we have some information of that kind available now, but we need more.

“A couple of weeks ago the Australian Medical Association released an information guide for patients.

“What was interesting is that it essentially implies that the patient is able to drive all this and force the doctor to give them information and the doctor will give them information not only about the doctor’s fees, the surgeon’s fees but also the assistant surgeon, the anaesthetist, the pathologist, the radiologist, the physician who might come and look after them and so on.

“Of course, none of that is happening and none of it is true but basically this is what we need to be thinking about and that’s where I think we need to go.”

He said that there should be a greater emphasis on patient reported outcomes, with outcome measurement one of the most important tools to drive innovation in healthcare.

Citing hip replacements as an example, he said that various prosthesis had revision rates varying from between two and eight per cent.

“We’re talking about outcomes that matter to patients, not outcomes that matter to clinicians,” he said.

“Three quarters or so of all hip prosthesis that are used in this country are not the best performing.

“I can understand the conversation with the orthopaedic surgeon, ‘so come and sit-down Mr Bloggs, we’re going to put a special hip prosthesis in you, I’m just letting you know it has four times the revision rate but that’s okay with you isn’t it?’

“Can you imagine that conversation, what kind of informed consent is going on?

“Probably none and yet this information is there.

“In my view it is unethical for an orthopaedic surgeon to not have that conversation and to not be choosing the best value outcome.

“There’s more low value care in the private sector than the public sector as you’d expect and in some cases it’s hugely different.

“So, what are we doing? How are we empowering private health insurers to address that problem?

“At the moment no one is addressing the problem.

“Low value healthcare has a number of components to it, one is ineffective care, care that’s useless, one is inefficient care, patients staying too long, or unwanted care, not thinking about what the patient wanted from their care.

“Often with value-based healthcare our discussions concentrate on the last element of that, just listening to the patient about what the patient values on their outcomes, rather than thinking about all three.

“Ineffective care is a bit more complicated, the responsibility of the provider, the responsibility of the funder, but it might also be the responsibility of the Commonwealth Government.

“We had the MBS review which was a process that involved looking at low value care and thinking about changes to the MBS items to address that, but of course when you think about whether that was a useful process or not again it emphasises the importance of looking at it, of thinking about value from whose perspective.

“If you just think of it narrowly from the taxpayer’s perspective it was a complete waste of space.

“My view is value is not only about the patient reported outcome and costs, but it’s also about the patient experience.

“We also need to think about societal related outcomes, healthcare is not only about individual treatment, healthcare has issues about creating social solidarity, teaching and all sorts of other things that aren’t actually in that value equation.”

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