Laszlo Sajtos, Paul Rouse, Julie Harrison, and Matthew Parsons

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Governments worldwide are facing the challenges of ageing populations. ◦ Europe – population aged >65 expected to rise

from 17% (2008) to 30% (2060) (Eurostat, 2008) ◦ NZ – population aged >65 expected to rise from

12.1% (2010) to 25% (2050) More elderly and fewer people to support

them (Dunstan & Thomson, 2006) Spending: 65+ (double), 75+ (triple), 85+

(8x) (OECD 2001)

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“...people should be able to continue living in their own place of residence in their later years...” (Jorgensen et al. 2009)

New Zealand District Health Boards contract for support services to be provided to older people in their own homes based on their level of need

Traditional view ◦ Fee for service ◦ Output has been identified with inputs i.e.

resource provision (hours of care) ◦ Clinicians’ view – everyone is unique

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The major problem in health care is to manage complexity (i.e. variety)

Therefore, our task was to identify factors that help reduce (or amplify) complexity in the context of Home-based Support Services.

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…is a system that classifies patients into groups that are homogeneous in their use of resources (Palmer, 1996; Zbylot, Job, McCormick, Boulter, & Moore, 1995)

Case mix complexity - Diagnosis Related Groups (DRGs) (Fetter et al. 1980). DRGs were designed to be homogeneous units of hospital

activity (e.g. nursing, diagnostic services, procedures) the best-known classification system that are used in the

case-mix funding model

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Qualitative interviews with regulators and providers ◦ Differing views on case mix complexity Severity & need for intervention (clinician) Resource intensity (regulator)

Collected quantitative data for 1,101 clients Holistic assessment tool ◦ ADL (e.g. bathing), Instrumental ADL (e.g. Ordinary

housework) Collection of activity and cost data

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Attenuators – reduction of variety using typologies

Amplifiers – technology, information and

networks

Law of requisite variety for homeostasis

Informal carers, telemedicine, social

networks

Capacity Capabilities

The amount of appropriate selection that can be performed is limited by the amount of information available. More information might be wasted but less information results in arbitrary decisions. ◦ the greater the variety within a system, the greater

its ability to reduce variety in its environment through regulation. ◦ Only variety can destroy variety (in the system being

regulated).

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‘Housework’ masks ‘shopping support’ (unable to drive, growing disability, risk of loneliness/isolation)

Demonstrate that homecare settings are potentially fruitful avenues for research on service provision and co-creation

“going to someone’s home and preparing a breakfast meal would be a relieving process (direct service provision), while providing a toaster so that the customer can provide self-service is an enabling (indirect service provision) process.” (Vargo & Lusch, 2007)

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We draw on cybernetics and the law of requisite variety to identify and manage (attenuators and amplifiers) variety ◦ Influence on resource use and integration ◦ Influence the shape of the market

Role of informal helpers: a person co-creates on-going experiences with a patient. ◦ Various roles ◦ Mediated value proposition ◦ Reiterates the process of voluntary exchange

through collaborative relationships that create reciprocal value through the application of complementary resources.

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Using Customer Networks to Shape Markets for Health Care DeliveryMotivation...ageing in place...Home-based Support ServicesResearch objectiveCase mix and DRGsMethodologyCybernetic perspective on managing complexityLaw of requisite variety (Ashby 1956)Slide Number 10Managing variety (chromosomes, products)SummarySummaryThank you for your attention!Slide Number 15