Healthcare Providers Begin to Monetize Their Innovation
Healthcare systems are beginning to take advantage of their employee’s intellectual and creative talent by cashing out on their innovative ideas.
Two examples of this growing trend include UPMC (University of Pittsburgh Medical Center) and the Cleveland Clinic.
The goal of these innovation centers is to produce revenue beyond their healthcare services.
UPMC has developed their own analytics software and now has plans to sell it to other providers interested in using big data, according to The Wall Street Journal. This software, developed in-house, uses available data to help physicians choose the lowest-cost option that produces a patient outcome equal to or better than the best outcome recorded in past case files.
Another example is Cleveland Clinic’s technology hub, Cleveland Clinic Innovations. This program, since 2000, has created 66 companies that have received a total of more than $750 million in equity. They do this by turning out ideas culled from the organization’s employees into useable and marketable productions.
Cleveland Clinic also partners with other healthcare providers, such as MedStar Health, to develop and sell new technology. Their deal has since been named, Healthcare Innovation Alliance. This is a unique relationship, one of the first of its kind to reach the milestone of bringing a product to market.
Their relationship includes signing a deal with InnoVital Systems to license patent rights for a device, InVEnt Diaphragm Assist Device, as reported by MedStar Health, a device that could make it easier for patients with severe lung and neuromuscular diseases to breathe.
This device could be influential in the market, as Definitive Healthcare’s hospital database cites an estimated 855 claims in the Medstar Health System year 2012, for DRG code 202, the lung diseases of bronchitis and asthma with cc/mcc.
Additional newcomers to this space include UCSF’s Center for Digital Health Innovation and Brigham and Woman’s Hospital iHub.
As the healthcare landscape evolves, it will be interesting to see if more hospitals become involved in projects such as these. Will these innovation centers be used as a way for hospitals to produce more revenue? Or will they become a way for health systems to showcase their technology and affirm their position as thought leaders in the space?