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In 1968, the American health economist Victor R. Fuchs wrote in the New England Journal of Medicine: “Medical tradition emphasizes giving the best care that is technically possible; the only legitimate and explicitly recognized constraint is the state of the art.” Nearly half a century later his words still ring true.
But the medical profession is often slow to adopt the state of the art. Witness the industry’s slow uptake of innovations such as telemedicine and electronic medical records. The 2009 Health Information Technology for Economic and Clinical Health Act created financial incentives and penalties to encourage health care providers to implement electronic records by 2015. Still, providers are lagging. According to a Health Affairs article, as of August 2013, only 40 percent of physicians had even a basic electronic health record system in place.
I’m often asked for advice on how to get physicians and hospitals to adopt new technology. In my nearly 20 years as an emergency physician, I’ve had numerous opportunities to evaluate the latest and greatest medical devices, diagnostics, drugs, IT, and, most recently, apps. I’ve observed that, while it is not easy to alter physician behavior, the most successful companies address four core issues: Need, Money, Quality, and Service.
The issue of need is simple—at least in theory. If you’re developing  medical technology, be a “must have,” not a “nice to have.” Talk to everyone in the ecosystem and understand the problems that absolutely need to be solved and present your solution as a no-brainer.
I once met the founder of a company who had created a simple, non-invasive method of analyzing heart rate variability as a surrogate to measure the autonomic nervous system. The device was FDA approved and already had existing codes for insurance reimbursement. But among the pain and endocrinology specialists I spoke to, there was not consensus that the device was so valuable that it would be a “must have.”
To be successful in the current economic climate, any new device or technology must demonstrate cost savings to the healthcare system. A cheaper product that replaces the current standard isn’t enough. It must contribute to indirect savings as well, such as by shortening hospital stays, enabling outpatient disease management, or personalizing therapy for a better outcome.
Vendors of new products for the healthcare industry must also understand and leverage money flow. Products are more readily adopted when existing reimbursement codes can be applied or they enable providers to treat specific conditions that they couldn’t previously treat.
For instance, GI Dynamics disrupted bariatric surgery with its EndoBarrier therapy, approved for use in in Europe and Australia, which enables endoscopic placement and eventual removal of a novel gastrointestinal sleeve. The field of bariatric surgery, which had been dominated by complex invasive surgeries that could only be performed by specialists, was suddenly open to gastroenterologists who could now enter a large, new market with a reversible procedure.
Successful products focus first on improving the safety and quality of patient care. Design solutions for the good of the patient first, and then for the benefit of the caregiver. If a device doesn’t improve upon safety and quality it’s hard to justify adopting it. But remember that quality is about more than just health; it incorporates cost, operations, and service.
Consider what the company InTouch Health has done to develop the telemedicine market with its remote robotic consultations:  The company’s platform, installed in over 1,000 hospitals globally, allows the delivery of timely, specialized neurological evaluations to remote locations, enhancing the quality of care for stroke patients who are candidates for acute interventions. Specialists see InTouch Health as an opportunity to brand their institutions as centers of excellence, large hospitals easily see the benefits of building relations with small hospitals by sponsoring the technology, and small hospitals see telemedicine as way to offer better care to their patients and community.
Ignore stakeholders at your peril. Understand the workflow of physicians, nurses, hospitals, and patients in detail. Then identify the most simple, friction-free insertion point for the key decision-maker and find a way to get in there. People and processes in healthcare systems are intertwined: A physician might order a test, but it is the nurses who carry it out. If the nurses find that the sample prep is too cumbersome or that maintaining reagents in refrigerated environments is not feasible, then the test may be doomed to fail. Consider the tremendous value that point-of-care tests such as the rapid strep test, urine dipstick test, and even the urine pregnancy test have provided to doctors, nurses, and patients. All were inserted seamlessly into the physician’s practice, did not pose any significant burden on staff, and provided satisfaction to the patient.
Getting physicians to adopt new technology is not easy. But as in any industry, success in medicine hinges on understanding your customers’ needs, how they will use the product, and if they will tell their peers that they simply must have it.
Akhil Saklecha, M.D. is a venture capitalist with Artiman Ventures in Palo Alto, CA and an emergency physician with CEP America at Good Samaritan Hospital in San Jose, CA.