I looked over the year that was 2009 in the cardiovascular ultrasound industry and decided the future was more important to focus on than history.
Not that history is unimportant. I just think it can serve a better purpose by being used to predict future trends. Trends that will lead to growth and new standards in the decade to come are what I focus on.
Future trends can be seen by placing what has already been accomplished along side advances that can be reasonably expected from engineering and materials science breakthroughs. Now these technology changes do not deploy in a vacuum so other forces will impact the degree to which these trends will impact individual markets.
So here are three trends for the coming decade.
1.) Ubiquitous Access & Interpretation
There is little debate among us that ultrasound has improved outcomes and reduces accidents when used at the point of care.
In 2009 healthcare executives spent on ultrasound across nine clinical settings: medical-surgical, emergency departments, cardiology, radiology, cath lab, operating room, Labor & Delivery and Other.
I expect this "other" category to grow tremendously by 2020 if you include pocket ultrasound devices.
By the end of this decade dozens of pocket sized ultrasound systems will be available to clinicians and hospital executives to deploy ultrasound more thoroughly across all patient encounters. How this new category of ultrasound devices will change the industry's approach to sales, distribution and support will vary across individual markets.
I believe at the end of the decade a given market's acceptance of these devices and their cost effective utilization will depend on:
-training thousands of clinicians the basics of transducer skills
-embedding technology in these devices that will allow over reads to occur by experts or more seasoned users remote to the bedside
2.) Fixed Technology and Service Costs
The large ultrasound manufacturers are signing contracts every day with large healthcare organizations that guarantee access to new technology and ongoing service for a fixed monthly cost without any up front capital outlay.
As large buyers continue to scale their operations to accommodate more patients this model of locking in a price for technology and service over the life of a outpatient facility will become standard.
How will this impact smaller organizations? It seems reasonable to expect a similar version of this financing plan to be offered to individual buyers.
And in the case of pocket devices we may expect to see a subscription based model more similar to mobile phone or net book plans, where the device is relatively affordable but the service and connectivity to the network is where companies try and make their money.
3) Economic Incentives Modifies Behavior
Health care reform, its financing and payment system in the USA, is difficult to understand, but will have the longest term impact on the industry as a whole.
As I write this it seems out patient facilities and hospitals are "cleared for take off" if you will. Uncertainty remains but executives in these two areas are beginning to have some clarity as to the realities of their cash flow and can begin to model around future expansions-or contractions to their facilities and service.
Once a patient is admitted deployment of ultrasound is increasingly seen by the insurance payers as a adjunct to care much as a blood pressure or other vital sign.
Many hospitals are in contract negotiations with insurance company's to cap or guarantee payment for the management of specific admission diagnosis, e.g. congestive heart failure. With the provision that the number of ultrasound procedures done is immaterial to the payment for that patients admission. The point is providers can use ultrasound as much or as little as they think best for a given patient but they will not expect higher payments for higher utilization of the ultrasound exam.
Thus deployment and utilization behaviors will change as a result over time.
I expect a significant number of cardiology practices that currently generate billings < 10 million US dollars per year will close in the first half of this decade.
Whether this will be fully attributable to the 40% reductions in Medicare payments for echocardiography over the next four years the ACC and other organizations are fighting by legislative and legal remedies remains to be seen.
Many small practices were already feeling economic pressure in the USA as a result of the severe recession gripping the country and are in the midst of considering selling their practice to a hospital or competitor.
Regardless of the office based remuneration rate we expect there to always be a place for small practices, but even their behavior will tend to mimic that of the hospital based utilization, because newer doctors will be trained to utilize and deploy ultrasound technology differently than the previous generation of practioner's. And consumers will come to expect a different deployment pattern based on their other healthcare encounters.
Successful companies will learn to navigate through these changes in the USA and other equally as challenging Markets across the globe in Europe, Asia and South America.
The manufacturers must develop new business models that adapt to these new economic environments or they will cease to exist.
So there you have it my big three trends for the coming decade.
Product Reviews
American Heart Association 2008, New Echocardiography Systems
Michael Adams, Product Manager, Biosound Esaote
Philip Coles, President, PCI Medical
John Davidson, Siemens, Acuson SC2000, 4D Echo System
Mike Graham, Institutional Sales, Anthro Corporation
Bill Kenny, Toshiba's Aplio™ Artida™ 3D Echocardiography System
Ron Marrocco, Philips Echocardiography Systems
G. Wayne Moore, President and CEO, Sonora Medical Systems
Richard Taylor, National Sales Director, ScImage, Inc
Don Wauchope, President & Founder, A2D Imaging
Researchers
Brian A Haluska, PhD, RDCS, AMS, FASE
Rob McDonald, RDCS, RCS, RCIS, FASE
