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Measure Conceptualization

Business Case Best Practices

Six Elements of a Well-Constructed Business Case

  • Net benefit summary
  • Precise statement of need
  • Measure impact
  • Influencing factors
  • Resources required for measure implementation
  • Costs of clinical care  

The net benefit section should succinctly summarize the rationale and justification for the measure and support this argument with key findings presented in the different sections of the business case document. While measure developers may use other models, a cost savings analysis model is the most prevalent for evaluating the potential quality measure’s business case. This quantitative model yields an easily interpretable result and the measure developer can make reliable comparisons across several alternatives, when relevant. If there is no expectation of savings until future years, the measure developer should adjust the savings to a net present value. The measure developer may apply this cost savings model for different measure types. However, the business case must always account for costs incurred in pursuit of the desired benefit.

The figure describes the flow of building evidence for a business case. Click the image to enlarge. 

Building Evidence Flow Diagram

Measure developers should measure better health and better care quantitatively using validated instruments and metrics, and clearly link those expected benefits assigned to a model for testing. Using the example of increased physician follow-up visits, improved care coordination may not only reduce expenses associated with unnecessary readmissions, but could also reduce mortality in selected populations and improve patient experience (e.g., Consumer Assessment of Healthcare Providers and Systems). 

Regardless of the model used, the business case should include an explicitly stated hypothesis for use in later testing and, at a minimum, predict how the measure will have an effect over time (the trajectory). This enables the measure developer to make comparisons during measure use, continuing evaluation, and maintenance. When possible, the measure developer should include historical and baseline data—that is, data collected from the measure (if completing for maintenance) or similar measures (identified during the environmental scan). 

After implementation of the measure, the measure developer should compare the business case and predictions about measure performance, which helped inform decision-making during measure development and selection for use, against actual performance. If anticipated improvements in health, provider care performance, and cost savings occur as predicted, then the measure is succeeding in terms of the business case. If anticipated improvements are absent, are less/fewer than anticipated, or there are unintended consequences observed, then the measure developer should reexamine the data, reevaluate the justification for the measure, and analyze why improvements are not occurring. The measure developer then should adjust the business case for any changes in the healthcare environment and revisit the initial assumptions as needed. For annual updates of measures in use and for continuing evaluation, simply reporting measure performance relative to predictions may be sufficient. For the comprehensive reevaluation, the measure developer should conduct a full analysis, and then report recommendations for improvement in an updated business case.

Last Updated: Oct 2022