We are in the midst of a seismic shift in healthcare. The need to drive down costs, coupled with new ways of using data and technology to monitor and assess disease progression, means patient outcomes are becoming the only reliable measure of successful treatment.
The shift towards value-based care, rather than pay-for-service, requires a new modus operandi across the sector. Pharmaceutical firms, healthcare providers, medical professionals, pharmacists, and payors will need to realign to focus on improving patient outcomes at a reduced cost.
This requires a range of approaches from enabling quicker recovery from short-term illnesses and injury, to managing chronic illness proactively to effectively deliver improved outcomes and better quality of life. With co-morbidity on the rise, more work needs to be done to create healthcare systems which can directly respond to the needs of patients and keep citizens healthy, both now and in the future.
There is hard evidence that pay-for-services is on the decline. It now accounts for just over a third (37.2 per cent) of reimbursement in the US and is projected to dip below 26 per cent by 2021, according to a study by analysts ORC International. This shift is a worldwide phenomenon and is something the pharmaceutical industry has been discussing for some time.
Leading firms are realizing they need to rethink their business focus and business models to prepare for this new world where payors will expect evidence of value and outcomes to support continued reimbursement.
In his recent article for Future Proofing Healthcare, Jim O’Donoghue, President here at S3 Connected Health, shared his thoughts on the shift towards value-based care and the impact it will have for pharma and the wider healthcare ecosystem.