Why ROI Measurement Matters in Healthcare—And How to Master It

With mounting pressure to do more with less, measuring return on investment (ROI) helps healthcare leaders make smart decisions, improve processes, justify resources, and protect high-value programs from the dreaded budget-chopping block.

Here’s why measuring ROI matters—and how healthcare professionals are doing it successfully.

Why Measuring ROI Is Critical in Healthcare

1. It Drives Better Strategic Decisions

Healthcare systems face complex choices every day—from adopting new technologies to rolling out patient education programs or wellness initiatives. The ROI Methodology® provides a data-driven framework to evaluate what works, identify what doesn’t, and make adjustments when appropriate.

Example: Scripps Health implemented a comprehensive employee wellness program to reduce health risks and lower health plan costs. ROI = 115%¹

2. It Proves the Value of Hard-to-Measure Initiatives

Not every initiative has a direct financial return—but that doesn’t mean it lacks impact. Evaluating ROI helps assign value to intangible benefits such as patient satisfaction, employee engagement, communication, and stress reduction.

Example: Memorial Hospital in Belleville, Illinois evaluated its chaplaincy program to determine its effect on patient and staff well-being, communication, and crisis support. The study found both tangible and intangible benefits. ROI = 644%²

3. It Highlights the Power of Process Improvement

In healthcare, refining processes isn’t optional—it’s essential for improving outcomes and reducing waste. With credible ROI data, leaders can demonstrate how targeted improvements lead to measurable impact, earning the confidence of boards, executives, and funders.

Example: Kelowna General Hospital in British Columbia implemented a change in the preparation and aftercare of colon cancer surgery patients to reduce infections, readmissions, and length of stay. The program demonstrated both clinical and financial success. ROI = 118%³

So How Do You Do It?

• Start with clear objectives: What outcome are you solving for—reduced readmissions, improved team communication, higher patient compliance?
• Use a systematic framework: The ROI Methodology offers five levels of evaluation data—from reaction and learning to application, impact, and financial ROI.
• Monetize the outcomes: Convert results (e.g., fewer errors, less overtime, better retention) into monetary values for a credible financial comparison to the program's cost.
• Report results with integrity: Include both tangible and intangible benefits, isolate the effects of the program, and follow conservative assumptions when estimating impact.
• Use the results to improve the process: Real progress happens in the review. Reframe ROI as a tool for insight into process improvement.

What Happens If You Don’t Do It?

If you’re not measuring ROI, you’re missing an opportunity—not just to prove the value of your programs, but to improve them. Whether you're in leadership, patient care, learning, HR, quality, or operations, ROI gives you a clear, credible, and consistent way to deliver outcomes that matter.

Now is the time to learn how to apply the ROI Methodology in your organization and make a real difference. Get started at www.roiinstitute.net.

To receive a copy of the examples listed, please email [email protected].

Sources:

¹Phillips, J. J., & Phillips, P. P. (2013). Measuring ROI in Healthcare: Tools and Techniques to Measure the Impact and ROI in Healthcare Improvement Projects and Programs. McGraw-Hill Education.

²Phillips, P. P. and Phillips, J. J. (2022). Show the Value of What You Do. Oakland, CA: Berrett-Koehler Publishing.

³Phillips, P. P. and Phillips, J. J. (2022). Show the Value of What You Do. Oakland, CA: Berrett-Koehler Publishing.