Innovation is often cited as one of the potential solutions to address challenges in healthcare. However, regardless of the value an innovation may hold for health and society, its structural implementation remains elusive if it lacks commercial potential. Valuable innovations, therefore, struggle to flourish.
By shifting the focus of financing mechanisms from commercial value to societal value, encouraging the dissemination of innovations beyond local healthcare providers, and assisting innovators in conveying their ideas, valuable healthcare innovations can be better accomodated.
This conclusion stems from a publication recently featured in Technology in Society by Medical Delta PhD candidate Sanne Allers and her colleagues from the Erasmus School of Health Policy & Management. The study is a result of the scientific program Medical Delta's Journey from Prototype to Payment.
The research delves into the role of financing mechanisms in the process from development to the implementation of an innovation, as perceived from the innovators' perspective. The researchers conducted a comparative case study of four innovation projects—two related to medical devices and two related to health information technologies.
Payment mechanisms as a barrier for healthcare innovation
Innovative products may indeed have significant potential for societal and health value. Still, if they possess limited commercial value, the chances are slim that they will be structurally embedded in practice or scaled beyond local healthcare providers.
The researchers found that payment impeded the progress of innovative products at each step in the innovation process. This impeding effect was most pronounced during the implementation phase. A decisive factor in securing sufficient funding is the perception of the commercial value of an innovative product; in other words, does a potential financier see enough commercial added value?
Alignment with Existing (Healthcare) Practices and Innovator Characteristics
Four other determining factors affecting the progress of the healthcare innovation process emerged from the study. One of these is the extent to which an innovation aligns with existing (healthcare) practices. The level of commitment, complementary competencies, and the social capital of the innovator also play a significant role.
The researchers offer several lessons for policy and practice that they believe increase the likelihood of innovations with potential significant value for health and society achieving widespread implementation:
- Shift the focus of payment mechanisms from commercial value to societal value.
- Support the dissemination of innovations beyond local healthcare providers.
- Assist innovators in conveying their valuable ideas.
Untapped Valuable Innovations
The researchers recommend increasing incentives for the development of innovations with potentially significant value for health and society, through subsidies. Furthermore, valuable healthcare innovations often fail to find their way into clinical practice when lacking a strong commercial business case. From a societal perspective, it is essential to restore the balance between commercial value and societal value. This could be achieved by encouraging value-based contracts between healthcare providers and insurers to shift the focus of funding from volume to value.
Promoting the dissemination and implementation of innovations beyond local healthcare providers can also be facilitated by making innovations more aligned with healthcare practices and addressing the not-invented-here-syndrome. The primary criterion for reimbursement from the basic benefit package could be revised from 'standard of science and practice' to 'innovative and with potentially significant societal and health value.' Moreover, the willingness of healthcare providers to change could be stimulated by providing them with more financial leeway to invest in innovative products—through public innovation payments via insurers and offering additional investment funds that providers can use at their discretion.
Lastly, innovators can be aided by helping them enhance and broaden their competencies through training and providing them with networking opportunities and a platform to share innovative ideas through special events.
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