Value Based Healthcare is Picking Up Speed-Med / Tech Are You Prepared?

In brief

The Canadian medical technology industry plays a crucial role as the conversation about value based healthcare transformation takes centre stage. First, they must demonstrate a better understanding of the healthcare provider’s journey through this challenging process.


The discussion has shifted and we are moving towards a day when a Canadian version of value based healthcare (VBHC) will become a reality.  Some providers have done a better job preparing their institutions for the transition by investing in infrastructure that supports patient centred outcomes, while continuously improving the cost of their healthcare cycle

In step with VBHC, the medical technology industry is quickly moving from a focus on products and services to offering solutions with higher potential value, hoping to demonstrate the advantages through value based procurement (VBP) initiatives.

Canadian healthcare is not one system but many systems joined together through the Canada Healthcare Act, so each region will move at the pace it can afford. Medical technology companies who adapt to this changing environment will offer solutions that support healthcare providers at each stage of this journey.

So, what are the best ways to know where your healthcare provider is on the VBHC spectrum? By way of the five actions outlined below, I will show you how to save time and develop a stronger relationship with your healthcare professional.

Deal with the System Complexity – Managers are dealing with increasing levels of system complexity. Demonstrate you understand the process, how it works and how we are engaged in the move towards patient first outcome based care. If you use the de facto product or service approach, the conversation will quickly move out of the clinical manager’s office and down the hall to materials management.

Understand the Business Cycle – Providers produce tremendous amounts of information. The good news is that it is posted on-line in some form or another. I am very surprised when I meet with industry representatives and they are only superficially aware of our performance position. In fact, they are shocked when conversations about incremental product improvements quickly move to a price comparison against the competition. I cannot stress this more; everything should start with a deep understanding of your provider’s performance position before you engage your healthcare professional. For example, how much revenue is achieved through ministry funding versus all other funding? The most likely scenario is that the Ministry of Health (MOH) funding is flat or decreasing year over year. How are providers making up the difference? The answer to these questions should affect the way you deal with each provider.

Calendar Effect – Time of year plays a major role in the way we view our business. You should be aware that the business is very fluid, although somewhat predictable. Industry often approaches providers the same way in April as they do in November; that is, through a transactional lens. Your forecast might need some tweaking if it was created without the impact of seasonality and our system constraints.

Value Based Technology Assessment – Providers are continually improving the system to effectively measure the difference in the benefits of products and services and the relative cost associated with the patient outcome. As providers improve an often-fragmented process, industry will have to adopt fluid strategy to sync with the changes or risk losing the opportunity to position brands effectively in the market.

Build & Measure Consensus Throughout the Patient Pathway – Multidisciplinary products and services are those that cross over department boundaries. They pose the biggest challenge for industry. I have asked industry representatives why they struggle making the leap across interdepartmental boundaries and I hear a multitude of reasons for the lack of success.  The problem is not that we don’t want to hear about your product and/or service but more importantly, why should we care about it in your terms versus ours. Consensus building starts by developing a deeper understanding of the interdepartmental goals and objectives. Often we have to communicate the value of your offering to our colleagues in terms of overall patient care so we require support to accomplish this.

Healthcare providers and medical industry are both taking an active role in the development of value based care and that is encouraging. Providers will continue to struggle as they implement necessary systems in order to convert to VBHC. Industry must spend more time developing methods to understand the journey more effectively, or they will find that they are on the outside looking in.


Geoff Harris

Director –Emergency, Ambulatory Care & Clinical Support Programs
Headwaters Health Care Centre



Mike Knapp
Independent Healthcare Management Contractor