Using simulation modeling to design value-based healthcare systems

For the foreseeable future, quality improvement of Healthcare Service Systems (HSS) will depend on implementing a health information infrastructure that supports human decision making about protocols, processes, and procedures that work together to support the valuebased paradigm. Based on a recent formalization of pathways-based coordination of care, this paper presents a simulation framework to guide design, development, and evaluation of architectures to produce value in health outcomes, i.e. to reduce cost while improving quality. The Pathways technology is a coordination structure that offers a potential for application to at-risk populations, but also more generally where services exist but are not efficiently nor cost-effectively deployed. A simulation model is presented that exemplifies this framework and is intended to predict return on investment for implementing pathways-based coordination as well its sustainability over the long run. Finally, we point out needed expansion of the model to include dimensions such as client risk characteristics, the referral source of clients to the coordination program, the effect of incentives on performance, and alignment of pathways with payments.