Major Business Challenges ofMedical Technology Organizations

The Major Business Challenges of Medical Technology Organizations

Medical technology is a multidisciplinary field that covers a broad spectrum of both research and applications across the healthcare field. In recent years there have been rapid advances in medical technology including miniaturized treatment and surgical procedures, state-of-the-art imaging techniques, or enhanced means of communication, as with telemedicine. These changed approaches are revolutionizing the diagnosis and treatment of diseases and benefiting both patients and helping individuals to remain healthy for longer.

For medical technology of any kind to be successful the most appealing solutions are typically the ones that bundle device, data, and real-time analytics that physicians, clinicians, health system administrators, andpayers will want to buy. For the best possible decision-making and outcomes from the technology, they therefore needthese solutions to deliver actionable information that is compatible with existing systems and approaches, which then ultimately allow them to more efficient, effective or productive (and better yet all three)

The strong move towards value-based reimbursement in the healthcare sector, mainly as a result of changes introduced by the Affordable Care Act, is also causing re-thinking in terms of to whom medical technology (apps and devices) are marketed and sold. Increasingly these technologies have to appeal to larger healthcare companies and institutions and not so much the individual physicians or smaller provider companies who can typically make quicker decisions about adopting the technology. This has two immediately implications for medical technology development organizations:
1. Large healthcare organizations (including insurance companies and larger hospitals, for example)may have great capacity to buy and distribute worthy medical technology but they are likely to be slower to decide and have many more due diligence steps prior to purchase.
2. Smaller, more local and independent healthcare organizations (such as medical practices and retail clinics, for example) can pilot or test or even adopt a medical technology but will have limited scope to use it at scale (not to mention have less money to invest in the technology until it is proven).

As a result of these two key drivers, medical tech products are likely to be preferred when they have a combination of features and services builtaround delivering very tangible solutions for large-in-size payers, providers (both large and small in scale), and patients of all kinds. For example, medical technology will be attractive when it:
• Has high levels of user friendliness for both providers
• Interfaceswith most electronic health record systems
• Helps to gather and analyze data for trending that helps customers managepopulation health
• Offers direct options for converting aggregated data into possiblerevenue
• Provides easy data download and/or export capability to aid collaboration and other research efforts in the same area
• Deliversclear performance information to help clinicians and patients to do things differently in the future based on the data.

Summary
Medical technology is exploding on both the device and software or application side and it is therefore now starting to make very useful contributions in many healthcare provider sectors in a number of different ways. However, technology companies need to recognize that there are at least two major markets for these products-large-scale healthcare companies with many customers and much smaller local healthcare providers with a limited customer base. This presents an array of challenges on both sides that need to be well thought through before too much investment is made. RX4 has experienced all of themedical technology challenges described above in many different healthcare environments and can provide considerable insight and options where the knowledge is limited or does not exist internally.

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Dr Jon Warner
Dr. Jon Warner
CEO-RX4 Group-Taking Care of the Business of Healthcare

Jon is the CEO of RX4 Group based in Los Angeles, California. He can be reached at jon@RX4Group.com

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