Hospital Value Analysis / VACs

Product_Value_Propositions The hospital value analysis process for medical devices is evolving to include more formalized committees, more sophisticated metrics, and a greater influence on the procurement process. These changes are in response to pressures to contain costs and respond to U.S. healthcare reform initiatives that emphasize clinical outcomes and system efficiencies. These committees and processes have a profound influence on the technologies that will be used within their hospital and hence their commercial success. This influence is only expected to expand with the ongoing healthcare reform initiatives…

The new focus will require a greater reliance on evidence-based approaches to product assessment, including comparative effectiveness, health technology assessment, and health economic methods…

Hospitals are also challenged with linking products with hospital-based outcomes. Decision-making is typically informed by literature review, physician guidance and hospital experience, third-party reports, and data provided by vendors…

However, these sources may be incomplete, of poor quality, or associated with perceived vendor bias. In some instances, hospitals may delay the decision to purchase a product until further evidence is generated. This data gap provides an opportunity for the device industry to play a leadership role in high-quality data generation. Such data will allow manufacturers to fully convey the value proposition of their medical devices…

Observational data may not answer all types of questions (e.g., comparing device efficacy), but it may be essential for determining long-term performance and safety in larger, real-world populations…

Manufacturers have several potential points of contact with stakeholders that may be involved in the VAC process. These include physician training and education, product trial periods, and contract negotiations. Through these interactions, manufacturers should maximize opportunities to communicate product value and supporting evidence. Recent studies have noted that it is not yet clear how the relationship between physicians and vendors may be affected by more aggressive standardization efforts.5 However, it is generally predicted that hospitals will increasingly limit traditional sales interactions to those that are perceived to be most valuable (e.g., training on products physicians are unfamiliar with). Maintaining an appropriate balance between serving vendor versus physician goals will be essential to achieve success.

In addition, the new economic stakeholders will require more complex models. These include different sales approaches, involving provision of more sophisticated data (e.g., comparative effectiveness, outcomes research and budget impact), outcomes-based contracts, and bundled purchasing models…

Scientific channels of communication, beyond traditional sales and marketing, may be required. Together, these personnel should aim to excel in increasingly complex contract negotiations that focus on solutions and outcomes. They must anticipate evolving needs (e.g., value demonstration beyond efficacy), extend product offerings beyond price alone (e.g., bundling, risk-sharing), and respond rapidly and efficiently to concerns (e.g., data queries, evidence generation)…

Hospital VAC use has increased and processes have expanded over time. VACs are increasingly focused on attaining an optimal balance between cost reduction and quality improvement. Most VAC structures include both clinical and administrative personnel to conduct clinical evaluation and provide cost analysis information and data review. However, there are several challenges associated with current U.S. hospital value analysis including physician buy-in and data availability….(…read more)

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