The Death of the "What Is Value" Guessing Game for Clinical and Plan Decision-Makers Ready to Move On, With Ahilan Sivaganesan, MD (EP505)

Time-Driven Costing and the Operative Value Index for Surgical Care, With Ahilan Sivaganesan, MD. Why "Value Equals Outcomes Over Cost" Doesn't Work Until You Can Actually Measure Both. Episode 505.

What if the only way to know who's delivering high-value surgical care is to actually calculate it, instead of guessing? Stacey Richter talks with Ahilan Sivaganesan, MD—known as Dr. Siva—a practicing neurosurgeon with the Hospital for Special Surgery in Naples, Florida, and Head of Quality and Value at Mishe Health, about the Operative Value Index (OVI): a common mathematical framework, built on time-driven activity-based costing (TDABC) and condition-specific patient-reported outcomes, that finally lets self-funded employers and health systems quantify value instead of guessing at it.

WHAT YOU'LL LEARN

✅ Why most hospitals and surgeons have no real idea what it actually costs to deliver a given episode of surgical care—a "complete guessing game" that becomes a serious business risk as procedural bundles expand

✅ How the Operative Value Index (OVI) combines time-driven activity-based costing (TDABC) with condition- and procedure-specific patient-reported outcomes into a single quantified value metric

✅ Why appropriateness, not just surgical skill, is the true foundation of quality—and how measuring conservative, non-surgical care can finally reward the right clinical decision instead of just surgical volume

✅ How Dr. Siva's "bubble chart" visualizations let self-funded employers compare surgeons, practices, and health systems on value at both the procedural and diagnosis level, risk-adjusted for confounders

✅ Why physicians can't reasonably be asked to take on risk-based payment models until they understand their own true costs of care

✅ Why Dr. Siva sees a "Google moment" coming for health systems still maximizing fee-for-service volume instead of competing on quantified value

WHY THIS MATTERS Across the $5.6 trillion healthcare sector, both halves of the value equation—outcomes and cost—are effectively question marks: costs get rolled up into vague, triangulated numbers while outcomes get broken down to the level of a single blood test. Without quantified outcomes and unit-level costs, no one can actually identify where high-value care exists, let alone pay for it in a way that isn't a built-in perverse incentive. As Dr. Siva puts it, health systems that keep maximizing fee-for-service volume are Yahoo laughing at Google, right before the world changed underneath them.

MENTIONED IN THIS EPISODE

EP434 with Benjamin Schwartz, MD, MBA: Apple Podcasts | Spotify | Other Apps

EP326 with Rishi Wadhera, MD, MPP: Apple Podcasts | Spotify | Other Apps

EP295 with Rebecca Etz, PhD: Apple Podcasts | Spotify | Other Apps

Article: by Dana Prommel Strauss

EP449 with Marty Makary, MD, MPH: Apple Podcasts | Spotify | Other Apps

EP503 with Ryan Wells; Leo Spector, MD, MBA; and Adam Stavisky: Apple Podcasts | Spotify | Other Apps

EP501 with Ivana Krajcinovic, PhD: Apple Podcasts | Spotify | Other Apps

EP398 with Jacob Asher, MD: Apple Podcasts | Spotify | Other Apps

Substack post by John Lee, MD

Essay by Dr. Siva

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00:00 Introduction to this episode.

00:38 The goal of this episode.

01:28 What the Operative Value Index (OVI) is.

02:04 A quick episode overview.

04:44 How this episode came about.

09:24 How Dr. Siva got involved in the research around outcomes and costs.

11:51 How the value equation doesn't add up to true quality.

14:12 What measuring quality across the entire care journey means.

16:07 Why appropriateness is the foundation of quality.

19:08 Why practicing clinicians need to be thinking about the true costs of delivering care.

21:20 Time-driven activity-based costing (TDABC).

23:44 The two things that must be known for value-based care to succeed.

27:09 A quick summary of the conversation thus far.

30:42 The power of transparency in Dr. Siva's bubble plots.

34:05 Why these bubble plots work not just at the procedural level but at the diagnosis level, too.

37:28 The "big blue ocean" opportunity for forward-looking providers.

40:37 The incredible opportunity for entities and groups that can help provide the infrastructure needed for this value index.

43:19 Last thoughts by Dr. Siva on TDABC and competition on value.