Recent changes in the US healthcare system are having a profound and transformational impact on the medical technology industry. As manufacturers face challenges to the traditional business model and the lack of reimbursement begins to limit the adoption and use of devices, medical technology companies now need to ensure that their offerings to the healthcare system are effectively differentiated. Several key factors will drive the outlook for the medical technology industry, including changes in how purchasing decisions are made and the rising demand for value-based products. In an operating environment where controlling costs is paramount, innovative medical devices that solely provide significant clinical advantages for patients may be at risk. Companies that can leverage an economic value proposition will have the opportunity to overcome the increasing barriers to favorable market access, despite the higher upfront costs.

Gaining access to markets and achieving favorable reimbursement are becoming more complicated. Consequently, medical technology companies must be ready to compete in the new healthcare environment by delivering a value-oriented product that lowers the total cost while improving clinical outcomes.

Questions Answered in This Report:

  • The increasing focus on value-based healthcare as a new paradigm has changed the pivotal audience and the decision maker for device purchasing. What are the trends reshaping the market toward value-based healthcare? How has the device purchasing landscape changed, and how will this change affect the medical device market?

  • The new healthcare framework is helping to drive the adoption of value-based products as it puts a spotlight on the long-term cost-effectiveness of medical devices. What are some select medical technology markets where the new value proposition dynamics have had an impact on the adoption and use of a medical device?

  • With the medical technology market landscape changing, a traditional business model will not be able to offset the growing sophistication of reimbursement authorities and device purchasing stakeholders, combined with the weakness in the US economy. What are companies doing in response to demonstrate value to different stakeholders? What are the implications of and recommendations for the shifting market landscape?

Scope:

Markets covered: United States.

Author(s): David (Dongho) Lee