Gary W. Herschman, Health Care Mergers and Acquisitions attorney, in the firm’s Newark office, was quoted in the Health Advances Blog, in “AAOS 2023: Implementing and Scaling New Technologies in a ‘Post-COVID World,’” by Masha Dumanis.
Following is an excerpt:
It’s BAAAAACK!!! If we are using AAOS booths to judge the impact of COVID, it’s safe to say the MSK world is ready to leave the pandemic behind. At 10 am Wednesday morning, the exhibit floor was bustling with activity. The booths are bigger than in ’21 and ’22 and foot traffic is up, if not 100% of former volume.
Industry Connector
What is valuable about AAOS beyond its baseline value as a conference for clinicians to share research, catch up on CE, and for OEMs to display their technology – it is a massive congregator of the entire MSK industry. Last week the top innovators, financiers, marketers, and strategists in MSK – along with their connectors, gathered in Las Vegas to assess the state of orthopedics and discuss how to move the industry into the next era. This included several conferences and events around the mainstage event. I had the privilege of attending several of these industry leading events, Canaccord Genuity’s Annual Musculoskeletal Conference and Epstein Becker Green’s Annual Physician Transaction Conference which helped inform my thinking on the evolution of the industry.
Addressing the Triple Aim with Innovation Will Require Cost Reduction
Most of you know the Institute for Healthcare Improvement’s framework of the “Triple Aim” for optimizing health system improvement. It states that new products must do 3 things 1. Improve the patient experience of care (quality and satisfaction), 2. Improve population health, and 3. Reduce the per capital cost of healthcare.
While it’s true that for each individual innovative product we examine, we are often looking for a cost-effectiveness story to present to the facility administrators, or to payers to improve coverage, I believe we are at a cross-roads where the reality is we are not going to achieve a “price premium” for most innovative products. Pricing pressures in the industry have been felt for nearly a decade, and with a mass migration of procedures to the lower-cost ASC setting, price becomes even more front and center. We will need to be able to find ways to fit innovation into current pricing models and to draw value for the innovators through the scale achieved. Displacing outdated technology, improving efficiency (more on this later), improving outcomes, and for those with winning products, gaining share.
COVID Impact, Private Equity, and OR Efficiency
Demand for orthopedic services, particularly surgery, in many markets continues to climb as we work through the COVID backlog, continue to deal with an aging population, and manage the early retirement of many in the orthopedic surgery profession through COVID. The increase in demand and decrease in supply highlights the need for efficiency in the field. “There has definitely been an acceleration in orthopedic practice roll ups,” said Gary Herschman, National Leader of Epstein Becker Green’s Healthcare Transaction Group. “Physician groups have been facing challenges: reduction in reimbursement, value-based care, and higher staff costs. Bigger organizations can address that better,” Gary added, speaking at the welcome event for his annual Physician Transactions Conference.
