The adoption of the accountable care model has transformed the way hospitals and practices evaluate their structure, activities and benchmarks. While the focus has been predominantly on IT tools and investments ACOs are driving to support population health management and collaborative care, business process change proves the biggest challenge facing healthcare providers today, according to analysis by Frost & Sullivan.
Among these challenges are issues surrounding data integration, physician alignment, risk sharing, information mobility and security, and leveraging lower-skilled clinical personnel and technology to achieve comparable quality with more efficient costs.
For medical device companies, analysts say sales and pricing models must adjust to address decision-making by committees and risk-sharing models in pricing for solutions. Device companies need to determine how their products add value in a data-driven world.
"What was once a payment is now a cost. What was once a cost is now a potential savings. Is this a revolution or evolution with an accelerated adoption curve?" asked Frost & Sullivan Vice President of Healthcare and Life Sciences Greg Caressi, during his speech at the 18th Annual Medical Devices 2013. "Successful approaches must reduce fragmentation to align with the future."
With healthcare shifting to more resemble traditional service industries, analysts say value must be delivered through technology and lesser trained clinical personnel. A recent study spearheaded by researchers at the Robert Graham Center and Georgetown University found that by 2025, the United States could be facing a dearth of some 53,000 primary care physicians. Thus, because the role of the PCP is rapidly evolving, a level of adaption on the part of the provider proves crucial. Caressi said if you combine this with the results of a Cisco-sanctioned survey finding that 70 percent of patients would trust an automated device for diagnosis and advice on whether to see a doctor, it's evident that the integration of IT solutions will significantly impact the way healthcare is delivered.
The geographic shift of growth in healthcare spending is changing as well, Caressi added. From 2010-2020, the compound annual growth rate (CAGR) of Asia-Pacific's total healthcare expenditure is projected at 9.2 percent, which is 2.3 times that of the G7 nations (United States, United Kingdom, France, Germany, Italy, Canada and Japan) at a 4 percent CAGR. These financial trends continue to drive the movement of medical device manufacturing and research into the developing world, as has occurred in other industries.
Accordingly, forward-looking organizations will not not base product and tactical sales strategies on quick returns, as resource limitations will eventually constrain a company's ability to support lagging business models. Healthcare players will also tend to de-emphasize clinicians and products, and capitalize on rising connected health solutions, focusing on growth opportunities in data exchange and interoperability, tiered product strategies to address segmented markets and solution sales versus product sales.