Value-based healthcare: what will you reimburse?

Medtronic explores new financial model geared towards value-based healthcare

Medtronic Prime Foundation Partnership
Standing: Karel Jacobs (UZ Leuven), Prof Lennart Scheys (KU Leuven), dr Lieven Moke (UZ Leuven), Ruben Cornelis (Medtronic), Prof Filip Roodhooft (Vlerick) and Walter Van Dyck (Vlerick). Seating: Lydie Vancauwenberghe (Medtronic), Olivia Natens (Medtronic) and ir. Nancy Vansteenkiste (UZ Leuven).

A new partnership has recently been created within the Vlerick Healthcare Management Centre; a tripartite partnership, in fact. As Prime Foundation PartnerMedtronic wants to support innovative research into value-based healthcare over the next three years. This will be focused on the care pathway for scoliosis surgery. “Medtronic wants to come up with solutions to the challenges faced in healthcare, but we cannot do this alone. Our aim is to do this through partnerships with experts in their field”, Olivia Natens, Country Director at Medtronic Belgium explains. “That’s why KU Leuven/UZ Leuven is also playing a key role in this research project.”

Olivia Natens (Medtronic)If we want to maintain the current levels of quality, accessibility and affordability in Belgian healthcare for the generations that come after us, then it has to be reformed. “Our healthcare system is based on acute care: reimbursements are based on individual contributions rather than on quality or results. In the long term, this is not financially viable”, Olivia explains. “All the different players in the complex biotope of healthcare – medical, technological, political – know that we must evolve towards alternative financing models in healthcare.”

“We must evolve towards alternative financing models in healthcare” Olivia Natens, Country Director at Medtronic Belgium

Kaplan-Porter

One model in which Medtronic strongly believes is Kaplan & Porter's value-based healthcare model. Value is defined as the health outcomes achieved that matter to patients relative to the cost of achieving those outcomes. 

Patient outcome      =       Patient value
Patient cost

Lydie Vancauwenberghe (Medtronic)The model has been an integral part of Medtronic’s company culture for a long time now. Lydie Vancauwenberghe, Head of Reimbursement, Health Policy & Economic Value at Medtronic: “Of course, additional value for the patient is first and foremost good news for the patient himself, but this also means that we reduce the costs or at least keep them as low as possible. In the past, Medtronic worked primarily on the numerator: by bringing new technologies onto the market, we create a better outcome and added value for the patient. In the denominator, we are increasingly looking at the economic value. We are placing greater emphasis on innovation in the care pathway and efficiencies in the system, e.g. via minimally invasive procedures that mean patients need to spend less time in hospital. We no longer see ourselves as purely a supplier of medical equipment and innovative technology, but as a supplier of services that create value for the patient.”

“We are placing greater emphasis on innovation in the care pathway and efficiencies in the system” Lydie Vancauwenberghe, Head of Reimbursement, Health Policy & Economic Value, Medtronic

Attention from Switzerland

Olivia: “In this partnership, we want to examine what form that model can take by bringing together a wide range of expertise: Vlerick, KU Leuven and UZ Leuven are contributing the academic/methodological expertise1, with UZ Leuven also contributing the medical expertise, and Medtronic the technological expertise. This project is being closely followed by our European parent company in Switzerland, so that it can be rolled out as an example in other European countries in which Medtronic has a presence.”

Remuneration for comprehensive solution

Ruben Cornelis (Medtronic)“This study must lead to a platform to which we can apply new financial business models, e.g. based on remuneration for a comprehensive solution”, says Ruben Cornelis, Business Manager Spine/Pain at Medtronic. “During the study, all results and costs across the entire care pathway are uncovered. We can then go and look at what the impact of that is on the total, whether it has a positive influence on the quality for the patient and on the total cost of the care pathway. It is also important for us to be able to bring the benchmarks from the study into our contacts with the government and with the insurance institutions. Indeed, reimbursement does not currently always correspond to the true cost.”

“This study must lead to a platform to which we can apply new financial business models” Ruben Cornelis, Business Manager Spine/Pain, Medtronic

Interdisciplinary

This partnership is also strategically important to Vlerick. “Healthcare is one of our focus areas”, explains Marion Debruyne, Dean of Vlerick. “As an independent party, it is our ambition to bring together a variety of different players in the healthcare field. As the research is focusing on the rollout of a financial business model for Medtronic, we are offering our academic knowledge and insights in the fields of Finance & Accounting at the Vlerick Healthcare Management Centre. This kind of interdisciplinary approach is the best recipe for out-of-the-box thinking. On the other hand, the collaboration with UZ Leuven strengthens our academic ties to KU Leuven, together with which Vlerick set up the Health Sciences & Business Institute earlier this year.”

“This kind of interdisciplinary approach is the best recipe for out-of-the-box thinking” Marion Debruyne, Dean of Vlerick

How is this research tackled? Read the ‘Value scan of a care pathway’ article.

1 From KU Leuven there is collaboration from the IORT (Institute for Orthopaedic Research and Training); UZ Leuven is providing the AZ-CP model.