IoT-Enabled Medical Devices Are Powering the New Healthcare Economy
Sunday, April 28, 2019
For the manufacturers of medical devices, the new, outcomes-based healthcare economy can seem like an approaching tidal wave: large, fast-moving and unstoppable. But market leaders have already seized the initiative and are riding the wave away from slower competition.
In most developed countries, outcomes-based health plans are already the norm. While the US has lagged in this area, there are now industry-wide efforts to catch up. And these changes aren’t just on the horizon; a recent survey finds that for insurers, outcomes-based contract discussions are up 25% in the last 12 months.
These changes are affecting medical device makers in a number of ways. For one, healthcare providers are pushing to replace a traditional capital expenditure model with a usage-based system. For example, hospitals no longer want to spend $2M on a PET scanner, when they can pay per image. While that shift frees up the provider to be more flexible and competitive in how it charges for services, it’s also a substantial adjustment for manufacturers who previously based their design, development, production and marketing on big-ticket equipment sales.
Device makers are also expected to embed more software and connectivity into their products. More specifically, the expectation is for more available data, intended to be shared between these products and a larger health data network. This change makes sense for outcome-driven doctors, hospitals and the networks; increased diagnostic capabilities and data can better assess both individual outcomes and analyze macro trends. But the makers of these devices, they are being asked to make their products much better, smarter and capable, while being told that fewer customers want to spend the money to buy these devices outright.
Like many other industries that are in the crosshairs of a technology-driven market transformation, some medical device manufacturers are leading the charge, others are following their lead and some are struggling to simply survive the transition intact.
How exactly are these leaders capitalizing on this transformation to get ahead? The easy answer is “IoT,” or more accurately “IoMT” (the Internet of Medical Devices), but more specifically they’re leveraging a specific, fundamental IoMT capability: remote monitoring.
This key capability is proving to be a game-changer in advancing service delivery for medical device makers. As manufacturers are pressured to switch to usage-based billing, monitoring and service become critical to ensuring that peak (billable) usage is unfettered by downtime—and remote monitoring has been proven to prevent downtime and increase predictive maintenance efficiency.
Remote monitoring also lays the groundwork for analytics, which delivers on the need for devices to be smarter and capable of better diagnostic insights. Manufacturers are adding more types of sensors, increasing remote portability and connectivity and leveraging machine learning and AI. Collectively, these investments result in products that can capture more types of data, follow patients to get a much fuller picture of health and generate better insights. These devices can even react in real-time to patient conditions—either through an automated direct function, relaying data to caregivers or even notifying an emergency response. That’s the type of game-changing technology that saves lives and improves outcomes. For the manufacturers, it also demonstrates the clear value of a smart-connected medical device that becomes an indispensable part of a healthcare technology solution. The device makers that can best execute on the vision of IoMT are in a position to command a premium for innovative, remote monitoring-based offerings.
Remote monitoring’s large, secondary benefit is that it helps propel longer-term improvements. Remote monitoring powers a “voice of the product” in the form of performance and usage data. These insights can inform product design, so that next generations of devices and equipment work better, do more and reflect the needs of their users.
To learn more about remote monitoring, and how service has become a catalyst for change for manufacturers, download the eBook, 4 Reasons Remote Monitoring is Your Best Move to Better Service. It breaks down the benefits behind remote monitoring and shows how companies like yours are using remote monitoring to innovate and monetize service.