Waste occurs when resources (time, money) are expended without producing value (improved health or quality of life). There are three main categories of waste:

• Administrative: spending on transactions, benefits management, marketing, regulatory compliance, etc., beyond what is needed to achieve the organization’s goals
• Operational: inefficient production of health care services, including duplicated services, excessive wait times, and medical errors that result in the need for further care
• Clinical: provision of clinical services for which the costs of the service outweigh the benefit to the patient