EXECUTIVE SUMMARY

Health care innovation does not succeed on clinical performance alone. To achieve adoption and scale, new technologies must demonstrate value across a complex ecosystem of stakeholders - each with different priorities, incentives, and definitions of success.

An innovation that improves outcomes for patients may not immediately show value for providers or payers. Likewise, cost savings realized in one setting of care may depend on decisions made in another. Understanding these dynamics is essential to communicating value effectively and ensuring innovations deliver their full potential.

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Value Depends on Who Is Defining It

The value of a medical innovation is not universal. It varies depending on who is evaluating it and what they are accountable for.

“Multiple metrics are essential to the aggregate of ‘value’; however, their relative importance is subject to variation among patients, providers, and payers.”
Annals of Surgical Oncology, 2024

These differing perspectives shape how stakeholders assess whether an innovation is worth adopting or reimbursing.

• Patients want to feel better, recover faster, and improve their quality of life.
• Clinicians focus on whether an innovation improves outcomes compared to the current standard of care.
• Health system providers assess whether it improves outcomes while also enhancing efficiency.
• Payers are primarily concerned with ensuring high-quality care is delivered at the lowest possible cost, particularly when improvements reduce avoidable downstream utilization

Because these perspectives differ, an innovation that is compelling to one stakeholder may be less compelling to another unless its impact is clearly translated.

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Translating Clinical Improvements into Meaningful Impact

Demonstrating improved clinical outcomes is necessary—but not sufficient. Stakeholders need to understand how those improvements translate into outcomes that matter to them.

For example, fewer complications may improve recovery for patients, reduce clinical risk for providers, improve efficiency for health systems, and lower costs for payers. Communicating value requires connecting clinical outcomes to financial, operational, and experiential benefits in ways that resonate with each audience.

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When Incentives and Benefits Are Misaligned

Often, the stakeholder responsible for purchasing an innovation is not the one who realizes its financial benefits.

For example, a technology used in the operating room may reduce post-surgical complications and readmissions. While the surgical team may purchase the technology, cost savings are often realized later in emergency or post-acute care settings. When benefits occur downstream, they may be undervalued during purchasing decisions, even if the innovation delivers system-wide value.

In other cases, improved outcomes may reduce revenue. A technology that decreases the need for repeat procedures benefits patients but may reduce procedural volume for providers. Without aligned incentives, these tensions can limit adoption.

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Evaluating Value Across the Patient Journey

To fully realize the value of innovation, its impact must be evaluated across the entire patient journey and not just at a single point of care. This includes clinical outcomes, operational efficiency, downstream utilization, and total cost of care.

When incentives are misaligned, the true value of innovation may not be realized. Aligning stakeholders around shared goals and transparent measurement is critical to achieving sustainable impact.

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What's Next in This Series

Defining value is only the first step. Real-world impact depends on how innovations are implemented and measured across settings of care.

In Part 2, we will explore why improvements demonstrated in clinical trials do not always translate into reduced health care utilization in practice and how enabling practice changes across the care pathway is critical to realizing value.

In Part 3, we will examine how selecting the right clinical, operational, and utilization metrics enables stakeholders to measure impact consistently and supports value-based procurement models.

Together, these articles outline how defining value, enabling practice change, and measuring impact work together to ensure innovation delivers measurable, system-wide benefit.

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‍Eva Baginska is Senior Director, Value and Access at Alkemi. She helps life sciences teams turn clinical results into clear value for each stakeholder, so treatments earn access and adoption across settings of care.

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‍Citation:

Bartlett CJ, Allen CJ, Greene AC, Joseph EA, Dunung R, Knotts CM, Chalikonda S, Bartlett DL. Exploring the Perception of Value in Cancer Care: A Comparison of Patients, Providers, and Payers. Annals of Surgical Oncology. 2024;31:6364–6365.