Value Creation in Healthcare

By June 25, 2019 Product Development

Marketing and selling products in the healthcare system is a pain.  It is a complex ecosystem, and just about every decision is made by committee.  Finding champions and building momentum is critical to success.  Regardless of the product or service you sell, there is a common set of criteria that is used to judge your value proposition.

Patient outcomes is straightforward:  your solution must make the patient better faster.  The healthcare system will pay more money for your widget if there is a demonstrable impact on a clinical goal or hospital length of stay.

The old adage — “the cure is worse than the disease” — still applies.  Every product and service used on patients has risks.  The risks of using your solution will be evaluated against current solutions.

Reduced costs in the ecosystem is the hardest to pinpoint but is often a tipping point.  If your solution saves time and money the value proposition is very strong.  Oftentimes, however, the direct cost of your solution may be higher to the department that is paying for it, but you could be saving the hospital money elsewhere.  Identifying that “somewhere else” is very, very important to understand.

The goal, of course, is to create enough value where acquisition and usage costs are less of a barrier.  While still important, higher costs are justified if value is being created in the other buckets.

If you have a product (or service) that is languishing, or are preparing for a product launch, use the above framework to ensure that you fully understand where value is being created.  Engaging healthcare professionals to sort these things out is not difficult.

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