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The Three Critical Steps Needed for Building a New Commercial Model
Driven by transparency requirements from CMS and new competitors entering the marketplace, healthcare delivery organizations are facing an unprecedented increase in their accountability for the quality and cost of care. This has profound implications for the commercial approach that manufacturers take to the market.
One clear consequence of this increased pressure has been a spike in consolidation among providers. Hospitals and systems are merging or affiliating at record rates; and these new entities are buying up physician practices to enhance their negotiating power through greater market share. The result is increased pricing pressure for suppliers – but that’s not all.
These larger delivery organizations are fundamentally changing the way that purchase decisions are made. Realizing that clinical-decision making is the biggest factor in both the cost and quality of care, delivery organizations are institutionalizing decisions once left to individual physicians. Joint administrative and clinical teams are evaluating product purchase decisions based on clinical and economic evidence – the result will be better outcomes and/ or lower costs. And macro treatment decisions will increasingly be guided by standardized care paths that may limit or exclude classes of products completely. As this dynamic continues to evolve, it’s clear that the traditional product-based commercial model focused on features and benefits will be insufficient to ensure market success.Read More
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