Business Models for ehealth Initial Overview of Results Brussels 17 November 2009 SIMPHS Validation Workshop
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1 Business Models for ehealth Initial Overview of Results Brussels 17 November 2009 SIMPHS Validation Workshop
2 Project Objectives The project wants to assess the size of the ehealth market in Europe and identify the underlining business models for sustainable ehealth systems; the collected evidence is expected to provide the basis for the identification of new policy options for fostering sustainable ehealth in Europe - Project objectives - Objective Business model evaluation Description Identification of evaluation methodology for the assessment of business models in the ehealth environment ehealth Market Assessment of the current market size for ehealth applications and services in the four areas identified in the ehealth Action Plan and make predictions of future size by 2012 Business Models for sustainable ehealth systems Identification of ehealth business models representing best practices throughout the EU member states through expert interviews and case studies Policy Identification and Vision Structuring of national and international policy initiatives and interventions aimed at the identification of business models supporting the sustainability of ehealth services and applications Today 22
3 e-healthcare business models: going beyond financial issues The notion of business modelling in ehealth is novel and highly unexplored. Still, the literature clearly indicates that, in light of the current evolution of healthcare delivery overall, the sustainability of ehealth systems is not just linked to financial performance but to the satisfaction of specific social-economic elements - Evolution of healthcare delivery- - Challenges for Business Modelling for ehealth Financial sustainability of ehealth systems connected to the satisfaction of non-financial situations Importance of considering ehealth systems not as platforms for the delivery of healthcare service but as tools supporting efficiency and effectiveness of healthcare delivery processes Socio-Economic Trends Aging Chronic Diseases - Affecting Trends- Health Specific Trends Funding complexities Patients Mobility Financial (and operational) sustainability is related to the implementation of change management within the entire development and implementation phase of an ehealth system Extended timings for the ehealth system development Un-healthy behaviour Healthy and independent lifestyle Standardisation Cultural differences 33
4 Business models: Identifying the interactions The literature clearly indicates that a business model is the design of interactions among resources customers to identify an offer from which to extract value Resources Offer Customer Co-creation - Interaction MappingeHealth Value Proposition Interactions Change management Data collection PROFIT Financial Performance 44
5 In our vision the maturation of e-health is evolving in four (overlapping) generations IV. Telemedicine Direct P2D C.I.S. Level II I.H.C.I.N. Level III C.I.S. Level II Patient / client IV. Telemedicine Integrated / Regional E-Health generations I. S.U.N.C.S. = Secondary Usage Non-Clinical Systems II. C.I.S. = Clinical Information Systems III. I.H.C.I.N. = Integrated HealthCare Information Network IV. Telemedicine: - Direct Patient to doctor oriented telemedicine - Integrated Telemedicine: based on a standardized and flexible (regional) infrastructure C.I.S. Level II 07 July
6 The WPII approach was worked out in seven steps 1. Determine clustering criteria and research quantitative data per cluster criterion 2. Cluster EU27+2 to five clusters with one representative country each based on cluster criteria 3. Estimating total ehealth market sizes for EU27+2 in Segmenting ehealth market sizes for EU27+2 in Determining final market sizes for each market segment of each Lead country 6. Expectations on growth and shifts of market segmentation for the Lead countries until Extrapolation from Lead Countries to ehealth market for all segments for EU27+2 from 2008 till
7 Estimating total ehealth market size for Europe in 2008: Estimation of size of the European ehealth market in 2008 ehealth has been defined as ICT for health by the European Commission (EC) in several communications From Gartner Healthcare Provider IT Spending was taken as the market size for ehealth. Gartner includes internal services in its market size of Healthcare Provider IT For the purpose of this analysis, internal services component has been removed from the total market. For the EU27+2 we get that the ehealth market size in 2008 was M and is projected to reach in July
8 Estimating total ehealth market segments for Europe in 2008: Estimation of sizes of the four ehealth market segments In addition to the four EU-identified market, a fifth market Underlying Technolgy was considered and distributed amongst the four market segments in proportion to their relative market sizes. Combined with available market information from Gartner (2008) the ehealth market segments in Europe are estimated to be distributed as: Market Segments Underlying Technology 40% CIS 13.5% IHCIN 3% Telemedicine 0.54% SUNCS 42.96% Total 100% Percent distribution of each segment Relevant secondary sources (e.g. Frost & Sullivan) were used to underpin the market segment distribution: - European Hospital Information Systems (HIS) market, European Hospital Administrative Systems (HAS) market, Market size of Telemedicine in Europe in 2008 This resulted in the following normalized composition for the 2008 European ehealth market % composition in 2008 Initial % for 5 segments Underlying Technology Distribution Final % composition SUNCS 42.96% 28.64% 71.60% IHCIN 3.00% 2.00% 5.00% CIS 13.50% 9.00% 22.50% Telemedicine 0.54% 0.36% 0.90% Underlying Technology 40% 07 July
9 EU 27+2 Total ehealth market 2008 & July
10 EU 27+2 ehealth growth rates per segment July
11 EU 27+2 ehealth market segments July
12 Case studies - CIS: TelemedEscape - Telemedicine: Tactive University College London - IHCIN: Naviva - SUNCS: Centro Unico di Prenotazione (CUP) Umbria 12
13 To analyse case studies of sustainable ehealth Business Models we co-created a four phased approach ehealth Business Model Approach I. Case Study Overview II. Business Model Analysis per case study III. Impact of the Business Model change on the ehealth service IV. Comparison of ehealth Case Studies with Expert Insights Identify the main drivers for ehealth Environment Main drivers to change the business model Solution Key Success Factors Map the situation and solution: Market segment Geographic position Value Proposition (Offer) Value Chain (care chain) ehealth Business Model Changes on the building blocks Effect of Value Proposition Determine perceived value of the new offer Effect of Financial Performance Business case insight Key Performance Indicators on: Resources Value Proposition Client/Patient Financial Performance 13
14 What offers the service to its clients, how are patients/users/doctors reached, what relationship is build, which resources are needed, how is money earned? Business Model Outline KEY PARTNERS What can partners do to leverage your business model (better, at lower cost)? KEY ACTIVITIES What key activities do you need to perform and how easily can you do this? KEY RESOURCES VALUE PROPOSITION Which of you clients problems do you solve and which needs are satisfied? RELATION PATIENT / USER / DOCTOR SEGMENTS What kind of relations does your patient/user/doctor expect and which kind do you maintain? CHANNELS What are your patients, users, doctors needs, problems, desires, and ambitions? What key resources does your business model require? Through which means do your clients want to be reached and which means do you utilize? COST STRUCTURE REVENUE STREAMS What is the cost structure of your business model and is this in line with the core values of the business model? What value are your clients willing to pay for and what is the preferred payment mechanism? 14
15 Centro Unico di Prenotazione (CUP) (Umbria, Italy) is an electronic system through which patients can book/reschedule/cancel and pay for specialist visits/tests requested by GP or following an hospital stay Identify the main drivers for ehealth system Environment Main drivers to change Business Model Solution Booking/cancellation/rescheduling and payment by patient of specialised visit or tests following the request by the GP via contact point at hospitals, health local authorities and private or local authority pharmacies Integration with Umbria s local radiology information system, laboratory information system and hospital information system Direct link with Italy s Ministry of Economic and Finance Multichannel access for patients to book/cancell/rescheduling of specialised test or visit Facilitation for rural areas Efficiency in in the collection of payments for test (tickets) Financial incentives for the involvement of private pharmacies Client/Server solution via regional Intranet solution managed by Umbria s in-house IT company Webred Actors involved: 2 Regional Hospitals (Perugia/Terni), 4 local health authorities (Citta di Castello, Perugia, Terni, Foligno) and 266 pharmacies (144 in in rural areas, 122 in in urban areas) and 487 specialist doctor or approved laboratories Potential users: over ca citizens, of which foreigners ( in in the Province of Perugia and in in the Province of Terni) Key Success Factors Business Model Direct involvement of of all actors in in the development of of the system Financial incentives for private pharmacies to to link-up to to the system Centralised IT IT infrastructure ITIL-aligned approach with IT IT support call centre (especially for private pharmacies) and for specific operational issues (e.g. suspension of of booking by a single laboratory/diagnostic centre due to to long waiting lists) 15
16 Through the direct involvement of 266 pharmacies, Umbria s regional health authorities have extended the point of access for booking specialist visits in the entire regions CUP without pharmacies CUP with pharmacies Outpatient Radiology Departments Outpatient Laboratories Hospital Radiology/Laboratory Outpatient Radiology Departments Outpatient Laboratories Hospital Radiology/Laboratories 3 3 Web-Red IT infrastructure Web-Red IT infrastructure Regional Hospitals 4 Local Health Authorities 2 Regional Hospitals 4 Local Health Authorities A144 Rural Pharmacies A122 Urban Pharmacies A15 GPs 1 1 Citizen/Patient Citizen/Patient 1: Request of test/specialist by patient/citizens 2: Automatic check on availability and assign date/time for visit 3: Response back on availability/available time 4: Booking/rescheduling complete-payment for visit by patients 16
17 CUP has extended the delivery channels on specific elements of the management of laboratorychanged individual elements of the business models related to the delivery of clinical documents by ULSS 9 diagnostic centres ehealth Business Model (changes are marked in red) KEY PARTNERS Hospital wards Diagnostic Tests 144 Rural Pharmacies 122 Urban Pharmacies 15 GPS Web (TBD) KEY ACTIVITIES 6 locations for booking/payment/reschedule/c ancellation of lab.test/specialised visit/ 281 locations KEY RESOURCES Diagnostic centres Hospital/Local Health Authorities Patients Pharmacies VALUE PROPOSITION High quality service Efficiency and effectiveness Multiple access points especially for rural areas Customer retention/additional revenues for pharmacies Management of the results of health awareness campaigns. CLIENT RELATION Distant relation Closer to needs of patients CHANNELS Hospital structures Local Healthcare authorities Pharmacies GPs Doctors GPs Patients Pharmacies PATIENT / USER / DOCTOR SEGMENTS COST STRUCTURE Personnel Direct cost (printing, etc ) Education & Training for pharmacies IT Call centre IT system integration IT support for pharmacies REVENUE STREAMS Pharmacies: 2 EURO per booking Better cash flow for pharmacies 17
18 Lessons from the case studies and public policy directions Mapping business model - Long term commitment of senior management - Not about new service but about news ways of delivering a specific healthcare care specific service Financial commitment - Stable financial support throughout project life line - Final support for supporting staff commitment Patient s needs - Patients viewed as clients or customers - Healthcare services aimed at providing more efficient services Open standards - Explicit use of technical open standards to foster integration and follow-up extension of functionalities Evaluation - Senior management commitment to a-priori and ex-post evaluation of the effects of IT-enhanced healthcare service 18
19 For more information Lorenzo Valeri, Research Leader, RAND Europe, 19
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