Optimizing ROI and VOI in Digital Health Investments: A Blueprint for Health Plans
As health plans face increasing pressure to demonstrate the efficacy of their digital health investments, a key challenge emerges: how to effectively measure and optimize return on investment (ROI) and value on investment (VOI). In a field where avoided costs often define success, quantifying outcomes requires both innovation and rigor.
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Defining ROI and VOI in Healthcare
Traditionally, ROI in healthcare is viewed through the lens of cost savings. For example, reducing emergency department (ED) visits or improving chronic disease management can translate to measurable financial returns. However, ROI doesn’t capture the full spectrum of benefits that digital health solutions offer. VOI broadens the scope, encompassing factors like improved patient engagement, enhanced provider relationships, and operational efficiencies.
“Health plans need to ask themselves not only how their solutions save money but also how they add value,” says Dr. Alan Spiro, MD, MBA, Founder of Alan Spiro Solutions. “For example, there’s intrinsic value in fostering engagement with members, improving relationships with providers, and even being perceived positively by your stakeholders.”
Metrics That Matter
To effectively measure ROI and VOI, health plans must adopt a multifaceted approach. Key dimensions include:
Engagement: Solutions must connect with their target populations. Engagement is a leading indicator of success, and platforms that deliver measurable improvements in member participation are foundational to any ROI calculation. For instance, a well-being platform achieving a 71% risk improvement among engaged members highlights the potential for impactful outcomes.
Containment: The ability to address member concerns effectively in the first interaction directly impacts costs. For example, solutions like nurse triage systems that achieve a 61% diversion from ED visits provide clear financial benefits while improving the patient experience.
Delight Factor: Ease of use and positive user experiences encourage repeat engagement, creating a virtuous cycle of utilization and satisfaction. High Net Promoter Scores (NPS), such as Pager Health’s℠ NPS of 92, reflect the successful integration of user-friendly technology with empathetic care delivery.
Business Value Beyond direct cost savings, health plans must consider broader business impacts, such as:
Attracting and retaining employer clients.
Enhancing market position.
Improving relationships with providers and employers.
Provider and Staff Wellbeing With burnout among healthcare professionals at critical levels, digital health solutions that alleviate administrative burdens or streamline workflows can significantly impact provider satisfaction and retention. Attracting and retaining employer clients.
Expanding the Data Universe
Traditional ROI calculations often rely heavily on claims and lab data. However, this approach risks the possibility of observation error by excluding vital inputs such as social determinants of health (SDOH), qualitative patient feedback, and other non-clinical factors.
It’s important to broaden data inputs to avoid observation errors and improve predictive analytics. Diverse variables enhance algorithms and lead to better outcomes.
Balancing Technology and Human Touch
While technology drives efficiency, it must complement, not replace, human-centered care. Technology is a tool to enhance human capabilities. By blending tech with compassionate support, we achieve both efficiency and empathy.
Pager Health’s success in achieving a 92 NPS score exemplifies this balance. Key strategies include:
Purposeful Implementation: Prioritizing solutions that add real value to both patients and providers.
Interoperability: Reducing enterprise friction through standards like FHIR and HITRUST, enabling seamless integration and personalization.
A New Paradigm for Measurement
Finally, health plans must embrace innovative methods to translate qualitative insights into quantitative metrics. For example, ambient listening tools can capture and categorize life context factors—cultural, economic, emotional—and assign measurable values. This allows for a more holistic understanding of member needs and solution impact.
Unlocking the Future
Optimizing ROI and VOI in digital health requires health plans to look beyond traditional metrics. By focusing on engagement, containment, delight, business value, and provider wellbeing, and by embracing diverse data inputs and human-centered technology, health plans can unlock the full potential of their investments. The future lies in blending innovation with empathy, ensuring that every dollar spent delivers both measurable and meaningful value.
For more information on this topic, check out Pager Health’s webinar with Alicia Coronas, Vice President of Employer Solutions Product at Priority Health, Alan Spiro, MD, MBA, Founder of Alan Spiro Solutions, and Rita Sharma, Chief Product Officer at Pager Health.