Value-based care and medical technology has been added to your bookmarks.
Value-based care and medical technology
Assessing the value of medtech products and offerings
In an emerging, value–based world, it is a business imperative for medical technology (medtech) companies to understand, demonstrate, and clearly articulate how their offerings can not only improve patient outcomes but also create value for key health care stakeholders.
- Watch the video
- A comprehensive framework to assess the value of medical technology
- Why does medtech need a new assessment approach?
- Elements of an effective value assessment
- How Deloitte can help
Value-based care and medical technology
A comprehensive framework to assess the value of medical technology
Deloitte Consulting LLP was engaged by the Advanced Medical Technology Association (AdvaMed), a trade group representing medical device and medical technology companies, to collaborate on the launch of a Strategic Value Initiative. The goal is to help bring about a common understanding across health care stakeholders of what enables effective assessment of the value of a medical technology. The initiative included the development of a framework and an approach for assessing the value of medical technologies that can be adopted by medtech companies, health systems, payers, and other industry stakeholders.
The framework spans a broad range of value drivers and does not solely focus on the cost or clinical impacts. The framework takes into account four value drivers, including clinical, non-clinical factors important to patients, care delivery economics, and societal impacts:
Why does medtech need a new assessment approach?
New risk-sharing and shared-savings systems are prompting providers and payers to re-evaluate their performance, including how they select and use medical technologies. In addition, responsibility for medtech selection is extending beyond the individual physician to include health systems and providers, payers, health technology assessment (HTA bodies), and patient advocates. Different stakeholders care about and prioritize different but overlapping sets of value drivers, against which they judge a technology's benefits. In response, Medtech companies must speak effectively to each stakeholder's unique set of value drivers in assessing the value of a specific medical technology.
While multiple frameworks already exist to assess the value of a life sciences product, many of these were specifically developed to assess biopharma drugs. From a Medtech industry perspective, widespread implementation of these frameworks "as is" would not lead to consistently appropriate decisions on the adoption of high-value medical technologies that improve patient lives. Value assessment practices must begin to account for and give adequate weight to a medical technology's comprehensive set of potential value drivers, including those captured by patient-centric measures.
Elements of an effective value assessment
The medtech industry's ability to continue to develop life-changing innovations will rely on assessing and demonstrating how medical technologies fit under the new value-based paradigm.
The full report on the Strategic Value Initiative puts forth recommended principles and an approach that MedTech companies and industry stakeholders can use to assess the value of medical technologies, including:
- A set of nine core principles to guide the process for assessing value: Comprehensiveness, evidentiary, cost, specificity, flexibility, engagement, transparency, and relevancy.
- Four broad categories of value drivers that capture the full spectrum of value that a specific technology may contribute: Clinical impact, non–clinical patient impact, care delivery revenue and cost impact, public and population impact.
- A comprehensive approach that can be used to develop a final analysis of the expected value proposition.
How Deloitte can help
As health care's volume-to-value shift accelerates, Deloitte can help medical technology companies navigate the increased scrutiny and changing decision-making dynamics that they face. By building on the value assessment framework, we can help companies:
Assess products to support launch and/or in-market growth initiatives: Implement a rapid, systematic diagnostic to synthesize the value proposition, identify growth risks, and prioritize potential actions:
- Refine an offering's value proposition with complementary services/solutions.
- Re-segment customers and align go-to-market priorities and messaging.
- Refine and execute an end-to-end (E2E) evidence management plan.
- Realign pricing and contracting strategies with an offering’s value proposition.
Optimize pricing and contracting strategy
Leverage robust, consistent value proposition tools to assess novel pricing strategies (e.g., economic or clinical outcomes-based models):
- Test an opportunity's magnitude, the feasibility to execute (with customers and internally) and ability to scale up.
- Identify capabilities needed to support value-based contracting—pricing, actuarial/risk, contracting, financial management and reporting.
Identify portfolio opportunities and make operational changes
Review new value propositions from cross-portfolio product combinations; identify target customers and go-to-market model:
- Develop a product's overall value proposition, field messaging, sales support model and incentives, training, and tools.
- Change/update supporting operational platforms and processes as needed (e.g., finance).
Inform an enterprise-level "readiness" view
Assess the maturity of capabilities required to compete in a value-based environment; develop a roadmap to the future that ties to the overall strategy and asset portfolio/pipeline:
- Deep understanding of care delivery models
- Robust outcomes measurement and end-to-end evidence
- Multi-stakeholder engagement and collaboration
- Effective contracting and payment including managing risk
- Differentiated services and solutions to complement the product
- Value-based governance of new product portfolio investments
- Critical enablers: Technology, finance, legal & risk, talent & culture
Connect with our team to learn how Deloitte can help medtech companies use the value assessment framework to clearly articulate and credibly demonstrate how their offerings can improve patient outcomes and create value for other stakeholders across the health care ecosystem.
Get in touch
Glenn Snyder, Principal, Deloitte Consulting LLP, and MedTech Segment Leader
Mary Cummins, Principal, Deloitte Consulting LLP and Life Sciences Value-based Care Leader
Amit Agarwal, Principal, Deloitte Consulting LLP, Diagnostics Leader
Rasit Omer Saka, Partner, Deloitte Financial Advisory, International Health Economics Outcomes Research