Editor’s note: Jeff Stinson has for the past 11 years managed the Fund for Arkansas’ Future, and is now also a member of HubX-Life Sciences.
Opinions, commentary and other essays posted in this space are wholly the view of the author(s). They may not represent the opinion of the owners of Talk Business & Politics.
To say healthcare has become a dominant, fast-growing business is a true understatement.
According to a new report by the U.S. Bureau of Labor Statistics (and as recently reported by Talk Business and Politics), healthcare support occupations and healthcare practitioners and technical occupations are projected to be the two fastest growing occupational groups during the 2014 to 2024 projections decade. These groups are projected to contribute the most new jobs, with a combined increase of 2.3 million in employment, representing about 1 in 4 new jobs, BLS said.
But how does a founder of an early stage, health care company capitalize on this opportunity? First, we have to recognize the emerging shift to fee-for-value from fee-for-service. This shift puts extraordinary emphasis on creating value for the patient, which puts pressure on payers and providers to work together to create this patient value.
As Gre’ Juana Dennis, a senior executive at Baptist Health in Little Rock, said, “Payers are being challenged to manage financial gaps and improve the care of their members within an evolving regulatory environment. Providers must transform business models to deliver cost-competitive services that improve patient outcomes. Now more than ever, our worlds are inextricably linked, and there’s an interdependency as we all share the goal of lowering the cost of care while providing better quality of care.”
The need for payers and providers to work together has fostered a number of formal partnerships, like the Partnership for a Healthy Arkansas, which is a Shared Services Organization between Arkansas Blue Cross & Blue Shield and four Arkansas-based hospital systems.
So payers and providers are collaborating to drive patient value, but what does that mean for healthcare entrepreneurs? It means you need to work with each of them during the early stages of your company’s development, as they each have a critical role in the industry. Innovation rarely happens unless providers are able to be paid for new products and services, and payers won’t approve payment unless they see a clear cost-benefit for doing so.
For founders, the benefit of an accelerator like HubX-LifeSciences – sponsored by Arkansas’ largest payer and hospital system – is you’ll receive granular input in the critical, formative stages of your company’s development, by both the payer and provider. And because these organizations are collaborating more than ever, a unique opportunity is created to have them working together to help you develop your reimbursement and distribution model.
As an early stage company, where else can you gain that level of input and mentoring from such large companies with deep resources?