When thinking of medical innovations, we recall machines of science fiction lore, and advances in areas like stem cell research have approximated the vastness of a Wellsian imagination.
Healthcare innovation is a point of pride for us as a country, as it well should be, but what if America’s global lead on healthcare innovation dissipated?
Forbes writer Grace-Marie Turner posed that question earlier this year, citing efforts by competing countries to lure research facilities and jobs away from the US, boasting friendlier regulatory policies, lowering taxes, and offering numerous monetary incentives, namely better access to investors.
Here is the US scenario: higher corporate taxes, a low OECD effectiveness ranking regarding our R&D tax and the ACA’s 2.3% tax on the revenue medical device manufacturers collect. Not to mention, the millions going to medical liability costs could be used towards innovations like medical information technologies.
Is the solution to call on Washington? Ask them to understand what heightened foreign competition could do to medical innovation? Many fear the ramifications of the ACA and future budget cuts will threaten our status as a world leader in healthcare technology, not to mention hospitals and health plans will be watching margins carefully in the years to come.
Perhaps the key is to use innovation as a tool for controlling healthcare costs, however. Healthcare leaders and entrepreneurs can defend the purpose and cost of innovation if they garner public support, and can do so by promoting cost-cutting solutions.
If members of all sides of the healthcare cost and accessibility debates could agree that an improved system is more important than any federal budget conflicts it may present, then perhaps healthcare innovation spending would be more justified. This is in a perfect world, of course.
Healthcare technology entrepreneurs need to continue promoting promising results and successes, demonstrating both to legislators and the public that ingenuity and efficient tech solutions result in improved care and outcomes, as well as lowered costs. This gives innovators reason to argue for sustaining an innovative climate in US healthcare.
Another solution? Reverse innovation. While the model of traditional innovation involves countries like the US developing high-end gadgetry that is later molded to work in lower-income countries, reverse innovation suggests we borrow existing ideas and rework them to fit high-end criteria.
The benefits of this process include affordability, no intermediaries, and a unique approach to problem-solving. General Electric, for instance, has developed low-tech infant warming devices to be distributed in third world countries, while Medtronic has invented the low-cost pill-sized pacemaker.
Not only can these countries market these solutions to emerging, fast-growing economies like China and India, but they can market these technologies as low-cost alternatives in slow-growing economies, like Europe and even the US.
Furthermore, reverse innovation can help us maintain an innovative healthcare culture, keep companies and jobs in the US and later justify the additional costs for the high-end technologies someone like H.G. Wells dreamt up.
Do you know what you need when setting up a new medical practice?
