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Hospitals look for new revenue in tech-related enterprises


A center of entrepreneurialism.

HealthcareDIVE discusses how  some health systems, faced with falling inpatient populations and  being pushed into value-based reimbursement, seek new ways to grow their revenue by setting  up tech and tech-related enterprises.

“One example is the University of Pittsburgh Medical Center, which two years ago created UPMC Enterprises to develop and commercialize novel technologies.

“As lead investor in a $5 million funding round, the health system is pursuing precision medicine with Pittsburgh-based Cernostics. UPMC’s support … will help bring to market a diagnostic test for people with Barrett’s Esophagus, a serious complication of gastro-esophageal reflux disease that can lead to cancer.”

“Another area that UPMC is focusing on is clinical decision support, making sure that technology that physicians and nurses use at the bedside actually helps, rather than hinder, them make the right decision. The health system has secured a majority interest in New York-based MedCPU and plans to co-develop future products with applications in population health, care management and consumer engagement, in addition to buying and using the company’s existing decision-support technology. ”

“Children’s Hospital of Philadelphia (CHOP) is also pushing the business model, looking at everything from devices that go on a child’s pinky to implantables that remain in the body throughout one’s life. Currently, the health system has about 50 projects running concurrently, says Patrick Fitzgerald, vice president for entrepreneurship and innovation at CHOP.”

He said that “CHOP’s focus, with entrepreneurship, is three-pronged: Create a culture that encourages ideas and innovation; make CHOP’s vast repository of knowledge and experience available to other hospitals and customers beyond the health system; and look for internal solutions that can be translated into new service offerings for CHOP patients.”

Hospital C-suites, however, should remember that health systems must carefully study whether they have the technical skills and leadership expertise to successfully pull off a venture.  They must ask themselves if they can build those resources in-house, partner with an organization that already has the expertise or hire a consultant to help set up the initial program.

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