March 07, 2016
Accenture Reveals Disruptive Forces Driving a New Order in the Healthcare Business Models
A shift from rewarding volumes of sales and patients treated to a focus on improving overall health, patient outcomes and value for the health system
NEW YORK; Mar. 7, 2016 – Accenture research in a new book titled Healthcare Disrupted reveals how life sciences companies are redefining their strategies and implementing new operating models as they prepare for disruptive forces hitting the broader healthcare ecosystem. The research explores how global changes in healthcare funding, the aging of societies, scientific breakthroughs, explosions in volumes of health and digital data, and new digital technologies are converging. This will require new definitions of healthcare and how it will be delivered and experienced in the future.
Authors Anne O’Riordan, global senior managing director of Accenture Life Sciences, and Jeff Elton, managing director, Accenture Life Sciences, have examined the forces transforming the healthcare and life sciences industries, from digital disruptors to changing reimbursement models. “A new order is emerging in the healthcare industry, focused on the patient, in which financial incentives will be linked to the value a product delivers, and not just the product itself,” said O’Riordan.
Accenture authors Anne O’Riordan and Jeff Elton describe the
four business models presented in Healthcare Disrupted
O’Riordan and Elton outline four emerging business models that are centered on patient outcomes and value:
- Lean Innovators: Companies that combine the best practices of generics companies’ efficient manufacturing and lean supply chain with M&A expertise, challenging existing cost structures, productivity, and operating models.
- Value Innovators: Companies that are scientific innovators, product-centric, and largely focused on specialty therapeutics and the patient journey which use complementary services to improve outcomes for patients and health systems.
- Around-the-Patient Innovators: Companies that are focused on improving patient and health systems by integrating therapeutics, devices and services with clinical management processes.
- New Health Digitals: Companies from within and outside the healthcare industry that are changing how and where patient care is delivered with economics grounded in digital, global scale and large ecosystems of apps, technologies, devices and the cloud.
“New targeted therapeutics, smart diagnostics, advanced informatics, and digital technologies are redefining healthcare and enabling patients to become more proactive in determining their own health outcomes,” added O’Riordan. “Many factors are catalyzing this change, including the availability of genomic, health, and lifestyle data, and an abundance of technology solutions that can help patients monitor, measure, and adjust their habits to improve their health and treatment outcomes.”
The authors believe that only the most agile and quick-responding healthcare companies and life sciences organizations will survive the changing environment, in part by embracing new collaborative technologies and building value-enabling partnerships.
For the first time, there is large-scale collaboration across industry boundaries. “Pharmaceutical companies, medical device organizations, payers, providers, governments, nurses, caregivers, patients, and high-tech companies – some new to the healthcare landscape – are joining forces in innovative ways, offering novel products, such as wearables, and combining them with services to improve health and wellness outcomes,” explains Elton.
The emerging business models are breaking old boundaries. “Traditionally, there were three distinct types of healthcare players: health providers delivering treatment and services; health manufacturers – pharmaceutical and medical device companies; and health payers which would typically be insurers and governments. But now, these lines of distinction are blurring as new approaches are deployed to improve both health outcomes and overall value to the health system,” added Elton.
The book outlines how medical device companies are transforming into service entities by remotely managing specific patient populations; pharmaceutical companies are adding robust services in support of the patients and health systems using their products; and providers are extending services into post-discharge monitoring and remote care. Accenture believes that these services collectively will transform care models and the outcomes and value achieved versus traditional therapeutic interventions alone.
Additionally, the authors predict new types of collaborative pairings occurring – medical device and digital technology companies with pharmaceutical firms; risk-bearing providers with life science companies; and payers with digital technology companies. “Payers are moving into the direct provision of care, health providers are now directly assuming and managing risk, technology companies are connecting remote clinical monitoring technologies and advanced analytics together as a service, and medical device companies are providing direct patient care management services,” noted O’Riordan.
“The days of slow and steady evolution in the healthcare and life sciences industry are over,” added Elton. “The industry that once measured change in decades is experiencing a disruption that will shift the landscape in just a few years, or even sooner. Radical changes are already making the industry more dynamic and unsettled than ever before. Executives and leaders at all levels will need to think differently and act as integrators. They will be indispensable to creating product and service packages of value, and interacting directly with patients and health providers, among others.”
Healthcare Disrupted is a call to action for life science and healthcare leadership to evolve new strategies and business models and reshape the future for better health, outcomes and value for the healthcare system overall. To learn more or to order a copy of Healthcare Disrupted, please click here. Healthcare Disrupted (Feb, 2016, ISBN: 978-1-119-17188-1) is published by Wiley.
About the authors
Anne O’Riordan is the senior managing director of Accenture’s Life Sciences industry group with responsibility for growing and developing the global Life Sciences practice. She has more than 25 years of experience in the life sciences industry and has lived and worked in Accenture’s geographic units in North America, Europe and Asia Pacific.
Jeff Elton, Ph.D., is a managing director, Accenture Life Sciences, and global lead of Accenture Intelligent Patient Platform. He is a board member of the Massachusetts Biotechnology Council, with more than 25 years of experience in healthcare and life sciences.
Accenture is a leading global professional services company, providing a broad range of services and solutions in strategy, consulting, digital, technology and operations. Combining unmatched experience and specialized skills across more than 40 industries and all business functions – underpinned by the world’s largest delivery network – Accenture works at the intersection of business and technology to help clients improve their performance and create sustainable value for their stakeholders. With approximately 373,000 people serving clients in more than 120 countries, Accenture drives innovation to improve the way the world works and lives. Visit us at www.accenture.com.
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