Increased healthcare spending may have economic benefits but a major industry transformation is needed to curb the unsustainable cost trajectory of spending. The key is to shift away from traditional healthcare, which often focuses on reactive, prolonged and expensive treatments, towards newer developments focused on diagnostics and catching ailments before they become a problem. In Mellon’s view, advancements in newer forms of care like preventive implants and gene therapy are the “new realities of healthcare” and in our view these treatments have the ability to influence the rate of spending without ignoring efficacy and safety.
To ensure success, companies considered the “new realities of healthcare” need to be focused on research and development driven products, efforts to cut off runaway healthcare inflation, diagnostic and preventive techniques and the adoption of emerging technologies that could streamline workflows.
As the paradigm shifts towards greater emphasis on development of affordable innovations that improve health outcomes, as well as lower out-of-pocket cost and cost of care, the cure to an ailing industry does not seem far over the horizon.
Matthew T. Jenkin, Rick R. Rosania and Kyle M. McDonough, Mellon.