Viewpoints on Innovation

Innovation Agility in Healthcare Part 3

Clarify Understanding of Product Data

Medical Device Healthcare

With an increasingly complex regulatory environment, healthcare execs are looking for ways to innovate faster so they can cope with changes and compete. The third step for forward thinking healthcare payors is gaining a clear understanding of product data.

Healthcare payors face an increasingly complex environment. Healthcare executives and product development professionals are looking for ways to innovate faster so they can cope with changes and compete.

To build the organizational capability and strategic agility required to succeed, payors must focus on three key areas: strategic alignment, agile development capability and a clear understanding of product data.

Part 1 of this series focused on improving strategic alignment. By ensuring agreement, commitment and organizational focus on strategic goals and objectives at the executive level, organizations can focus innovation resources on priority areas. As market and strategic priorities shift, a clear decision-making and review process increases nimbleness and ability to compete.

Part 2 covered increasing development capacity through agile product development efforts. Making better, more agile use of resources to deliver products to market requires clear processes and timely decision making during the development effort, as well as clearly defined team structures and departmental involvement.

The third step for forward thinking healthcare payors is gaining a clear understanding of product data.

Struggling with Complexity

Health Plan product data structures are complex, reflecting strategies, capabilities and requirements. Plans have scores of components, each managed by different parts of the organization. Each component impacts documentation for regulatory filings, legal plan descriptions, adjudication requirements, marketing materials and customer service support.

In many organizations this documentation is managed as red-lined word documents in the equivalent of electronic filing cabinets, making cross-plan comparison difficult, if not impossible.

Typical Complex Health Plan Product Data Structure


To truly improve innovation capability, healthcare companies need to understand the following elements about their products. 

  • Responsiveness: When responding to regulatory mandates, competitive threats and sales opportunities, it’s important to quickly understand which plans have particular product options, which are customized and which are not.
  • Network – Product Alignment: Leveraging contracted facility / Independent Physician Association (IPA) relationships and meeting Medical Loss Ratio performance targets are more important than ever with regulatory-mandated targets approaching 85% or higher. Understanding which network sets are used in which products is crucial to both.
  • Level / Accuracy of Service: Alignment of product options to customer service and auto-adjudication capabilities is essential to delivering quality customer service.

Payors that develop searchable product data management (PDM) systems capable of maintaining product designs at the component level will be more equipped to respond to the evolving healthcare market. These systems will evolve the organization from the impenetrable filing cabinet to a collaborative system that allows them to:

  • Rapidly search for and reuse common product components, either for design or change purposes
  • Ensure the language used to describe product components meets regulatory filing, reporting and marketing requirements, while enabling multiple language support for plan documents
  • More quickly assemble product changes and generate plan filing documentation, improving market responsiveness

A Look Back at our Innovation Agility in Healthcare Series

Over this three part series on Innovation Agility in Healthcare, we outlined how payors should focus on three key areas of strategic agility to compete in the evolving healthcare market. Our top three recommendations are:

  1. Drive strategic alignment of corporate strategies to innovation strategies and activities
  2. Build agile development capabilities designed to standardize development practices and roles in the innovation process
  3. Ensure a clear understanding of product data to enable rapid development and change in response to regulatory, market or key account demands

Developing these capabilities will greatly enhance healthcare payor ability to focus scarce resources on developing the right concepts, at the right time, for the right market.

Originally published on May 21st, 2012

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Topics: Andrew Nygard, Healthcare, Healthcare Innovation, Healthcare Product Innovation, Healthcare Reform, Healthcare Research

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