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Defining Value Proposition in Healthcare

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What healthcare organizations offer patients—their health—is invaluable. This is what makes it so hard to define what a strong value proposition can mean in personalized healthcare. But healthcare is a business, and businesses need to know how to position themselves to potential clients and partners alike.

In this blog, we’ll break down all you need to know about value propositions in the healthcare industry:

  • The controversy around whether value props work in healthcare
  • The value proposition in healthcare for internal and external purposes
  • Value proposition examples healthcare companies can use

By the end of this blog, you’ll be prepared to craft value propositions for your own healthcare organization. First, let’s define the value proposition in healthcare.

Do Value Propositions Work in Healthcare?

Healthcare predates modern notions of business value. Long before companies had to worry about IPOs and matters like contract management, healers were administering care in roles indistinguishable from priests or shamans. In the context of contemporary, advanced nations such as the US, healthcare exists alongside other industries like tech, retail, or manufacturing.

Many scholars have come to question whether the concept of a value proposition is even really applicable to the field of healthcare.1 While this article will argue that it is, we should take these questions seriously and carefully consider why and how we are defining healthcare value props in the first place.

Let’s take a close look at some of the biggest challenges, then their solutions.

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Key Challenges to Defining Value in Healthcare

The reasons healthcare value propositions are difficult to define stem from the ways in which value itself is incredibly hard to define when it comes to healthcare services. The value of most consumer products and services can be measured with clear-cut metrics like build quality, user satisfaction, and price. But in healthcare, complicating factors include but are not limited to1:

  • Clients seek out services out of need, not want; desired outcomes are often unclear
  • Services and goods provided are necessarily unique and tailored to individual needs
  • Treatments are often long term, carry significant risks, and involve outside variables

For these and other reasons, value can be nearly impossible to define in healthcare. A patient who is cured of a condition may harbor resentment about inconveniences involved during their patient experience, whereas patients who lose their battles against given ailments may still be satisfied with the service received.

Why Value Propositions Matter in Healthcare

These challenges are real, but not insurmountable. We firmly believe that it’s possible to define value based care in healthcare generally and in your company specifically.

Not only that—it’s also one of the best ways to set yourself apart from the competition and help patients and other stakeholders understand why your company is worth their business. To do so, you’ll need to minimize the number and severity of variables, converting raw data into powerful analytical metrics/tools.

Then, you’ll need to get internal and external stakeholders together to discuss and define your goals for value propositions. Does your company need them or want them? And why? Reasons uncovered will go a long way toward informing and shaping all of the value props you develop.

What Is Value Proposition in Healthcare?

There is no question whether businesses in healthcare should establish mission statements to guide their decisions and growth over time. In the most basic sense, the value proposition in healthcare can be derived from, or informed by, the mission or vision of a given organization.

There’s also no question as to whether or not healthcare providers offer value to patients, investors, and society more broadly. The uncertainty begins when one is asked to measure these companies’ value.

If nothing more, a value proposition statement in healthcare offers companies a way to define what they do and how they help patients heal. Value propositions highlight the biggest benefits healthcare providers offer to key stakeholders involved in healthcare services.

This all begs another key question—which stakeholders? Who are these value props for?

Who Are Healthcare Value Propositions For?

Again, no one questions whether healthcare is valuable. What they do question is how valuable it can be or how valuable a given healthcare company can provide for them.

But who questions this?

The main parties to whom healthcare value props are addressed are patients, or the ones actually seeking care from the doctors or other providers who make up a healthcare business.

Other key parties to consider are the payors in a healthcare network, such as insurers who are partly responsible for covering patients’ costs. Also, other strategic partners—such as vendors, contractors, or investors—are key recipients of often very different kinds of value propositions.

Value propositions are transitive and transactional in nature; this is true for value props in every context and for every organization that offers them. It also means that the intended audience or recipient of a given value proposition will determine which qualities the company highlights.

Examples of Healthcare Value Propositions

All value propositions in healthcare generally need to focus on the quality of patient care provided. However, the ways in which they address this will differ depending on the audience. The three general categories of value propositions healthcare companies should highlight include:

  • Value propositions about treatment outcomes and the satisfaction of patients served
  • Value propositions about smooth integration of payors through contract management
  • Value propositions about efficiency, quality of staff, and the potential for future growth

These categories correspond to the three main audiences mentioned above—the patients themselves, their payors, and other third parties, respectively.

Let’s take a closer look at each.

Top Healthcare Value Propositions for Patients

When defining the value of your healthcare company to patients, the things they are likely to care most about are those that involve their own health most directly.

To that effect, value propositions should include highlights of patient outcomes. High percentages of success for procedures and treatments are a great place to start, as are baseline statistics illustrating how many patients exits your facility healed and healthier than they were when they first entered it.

Other big concerns patients may have related to their general ease and feelings of satisfaction when interacting with your staff and facilities. Patient evaluations can be a great source and inspiration for messaging around these. Play up bedside manners and all accommodations.

Top Healthcare Value Propositions for Payors, PayrHealth

On another level entirely, the value propositions you present to payors should focus on your ability to navigate and manage your relationships with them effectively. This involves the key area of contract management. PayrHealth is happy to help with two key elements of this:

  • Signing better contracts – Our team of specialists will work individually with each of your existing and potential contracts to find ways to optimize both dollar amounts and terms of service for all parties involved with powerful, value-driven data and analytics.
  • Negotiating higher rates – We’ll also work with you to negotiate better rates for both your company and its payors. We’ll do so by finding the perfect balance of renegotiating older agreements and finding mutually beneficial efficiencies in all future contracts.

Beyond these, most payors you work with will also look at the value props you provide to patients, as their relationships with you are determined by your relationships with patients.

Top Healthcare Value Propositions for Partners

Finally, the last category of value propositions you should consider involves the network of investors, vendors, contractors, and other third parties that orbit your business. Like payors, these stakeholders are likely to be interested in your patient-facing value propositions, which provide the most direct overview of your mission and overall value as a company. However, they’ll also likely be interested in your potential for growth—and how they can grow with you.

Here’s another key way in which PayrHealth can help you maximize your value and optimize your value proposition. We’re committed to helping companies grow their teams with the most effective staffing and resources, from full-time staff to flexible part-time and contractor workers. Contact us today to learn more information!


  1. CMS. Developing Your Value Proposition: A Step-by-step Guide for Behavioral Health Providers.
  2. Inquiries. Can the Value Proposition Work in Health Care?
  4. Journal of mHealth. A Strong Value Proposition: The Key to Engaging the NHS in 2019 for SMEs.

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