Healthcare Market Dynamics

The healthcare industry is in major transition from “fee for service” to “value-based models” 

Purchase decisions are transitioning from the physician to integrated health systems and from fee-for-service to value-based

  • Historically purchased decisions were made primarily by physicians who where paid on a “fee for service” basis

  • “Progress at any price” focused on improved clinical outcomes with little regard to price. 

  • This worked because “fee for service” payment with the physician making the purchase decision independent from the payers 

  • This resulted in many new devices coming to market with only incremental improvement 

Increasingly based on improved patient outcomes

  • Value based models are now defined as what improvements versus incremental costs

  •  Must be compelling enough to make the purchase decision

The bottom line: 
a new device must …

  • Demonstrate a major (not incremental) cost reduction impact 

  • Generate measurable savings while providing better patient outcomes

  • Be evidence based

The Value Proposition must now …

  • Include a  major focus on proving how this new medical technology will positively impact healthcare economics 

  • Become the core sales and marketing pitch, provide competitive differentiation and the basis for value analysis. 

This major transition can be a tremendous opportunity for those who understand and take advantage of these changes

Continue reading by selecting a chapter below:

Macro changes
in healthcare  
market dynamics 

Key inflection  points and
strategic milestones

A financing plan focused on    
value creation 

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