With a continued shift toward patient-centered and value-based care, health plans are being called to rethink how they assess the value of their investments in technology. Traditionally, return on investment (ROI) has been the gold standard for evaluating the financial returns from any new technology or investment. However, its narrow focus on quantifiable cost savings or direct financial gains overlooks the broader, long-term benefits that technologies can offer. In fact, a recent survey from Deloitte found that in 2024, cost reduction dropped to the lowest priority among 17 options, including member engagement and satisfaction. 

As the industry adapts to new models of care and payment, I believe health plans will increasingly turn to a more comprehensive approach: the value of investment (VOI). VOI represents a more holistic method of evaluating technological investments. While ROI remains important, VOI enables a healthcare organization to assess financial returns as well as operational efficiencies, regulatory compliance and, perhaps most importantly, improved member engagement and satisfaction. For health plans seeking to make strategic, sustainable investments in support of value-based care, understanding the factors that contribute to VOI can lead to more informed decision-making and better alignment with long-term organizational goals. 

Assessing the value of investment for healthcare technology

1. Operational efficiency
   Technological advancements can significantly streamline operations, leading to reduced administrative burdens and improved workflow efficiencies. Consider the example of claims management, which demands careful attention to detail, including verifying treatment codes, reviewing documentation and assessing clinical complexity. AI and automation technologies enable health plans to swiftly process, standardize and route large volumes of data across diverse systems, minimizing the reliance on manual, error-prone workflows. By automating repetitive tasks such as data entry and verification, these technologies enhance both consistency and accuracy in claims processing. The operational efficiencies gained through automation not only optimize the claims process but also free up valuable resources within health plans, allowing them to focus on higher-value initiatives.
2. Member satisfaction and engagement
   In an era of consumer-driven healthcare, health plans are increasingly measured by their ability to provide a seamless, positive experience for their members. Technologies that improve member engagement can significantly enhance satisfaction and loyalty. For example, technologies that increase transparency and help members understand their costs upfront not only support informed decision making but better financial planning, ultimately improving member trust. These improvements, while not always reflected immediately in financial returns, are vital for long-term retention and member-centered care, which ultimately leads to improved health outcomes and reduced costs.
3. Regulatory compliance
   Healthcare organizations are under constant scrutiny by regulators and must ensure they comply with a myriad of laws and standards. Unfortunately, many don’t have the resources to handle constant updates to systems. Technologies that help health plans meet regulatory requirements, like aligning pricing with state and CMS guidelines, can provide significant value as updates are automatically made on the health plans’ behalf. By integrating compliance-driven technologies, health plans mitigate risk and create a foundation for sustained success in an increasingly complex regulatory environment.
4. Improved health outcomes
   A fundamental goal of healthcare is to improve patient outcomes, and VOI takes this into account by assessing the impact of technology on health. For example, incentive programs in healthcare can encourage specific behaviors throughout the healthcare journey. Incentives like a gift card for attending an annual wellness visit or a prepaid card for receiving the flu shot can prompt a member to act, take charge of their care and lead to improved outcomes. These advancements support the long-term health of the population served, aligning with value-based care principles that emphasize prevention, early intervention and coordinated care.
5. Scalability and adaptability
   To meet the industry’s evolving needs, health plans need technologies that address the current state and are flexible enough to adapt to future changes. As health plans mature their data infrastructure and vendor ecosystem, it’s important they invest in technologies that can seamlessly integrate and offer flexibility in how they're deployed to avoid complications down the road. Adaptability contributes to VOI by ensuring that the organization’s investments remain relevant and useful as the industry evolves. Technologies that can scale with the organization or integrate with emerging systems offer long-term value by positioning health plans to stay ahead of trends and innovations.

The Value of VOI for Health Plans

The growing emphasis on value-based care, combined with the need to address rising costs and technological complexity, makes VOI an essential framework for payers to navigate healthcare investments effectively. As the industry continues to evolve, VOI will help guide health plans toward decisions that not only provide immediate benefits but also lead to sustained improvements in the overall healthcare system. To get started, health plans should begin evaluating technology through a VOI lens, considering both immediate and future impact, and adopt frameworks that enable them to measure and track this value over time.