The global healthcare market continues to be influenced by ongoing cost-containment strategies in an attempt to limit growing healthcare expenditure. Focus on work-flow efficiency, patient compliance and patient-centric care are just some of the strategies being employed to streamline spending, particularly in markets where profit margins are becoming increasingly tight. The respiratory care market, including the markets for ventilators and sleep devices, is no exception to this trend; such strategies are driving the use of efficient and cost-effective devices.
Slow economic recovery continues to restrict growth of respiratory care in the mature, established markets and stifles development in the emerging markets, where the focus remains on basic healthcare provision. Healthcare spending on respiratory care is high in North America, Western Europe and advanced Asian markets including Japan. In the United States alone, spending on chronic obstructive pulmonary disease (COPD) only is estimated at approximately $34 billion per year. In these mature markets, where growth remains limited and healthcare providers demand more cost-effective solutions, the ‘cash-cows’ are automated devices (i.e., those with automatic feedback systems that change the level of care provided based on the patients’ changing needs, for example closed-loop ventilation and auto-PAP sleep therapy devices), and home-care devices that allow patients to be treated with minimal intervention by healthcare staff.
As a result of high costs associated with respiratory care, cost-containment strategies are already being implemented in the respiratory market:
- Using home-based diagnosis and treatment as early as possible, improving patient compliance to reduce readmission of patients.
- Use of automated devices is increasing to reduce the burden of patients on staff. This is driving a shift away from the use of complex, high-end devices for basic diagnosis and treatment. More diagnostic testing and high-acuity treatment are increasingly used only for patients who require this higher level of care.
A shift towards home care
Moving patients out of the clinical environment to the home is a cost-reduction strategy that has been used widely in recent years in healthcare, and continues to drive the respiratory home care markets. By allowing patients to be treated in the home, the overall cost of patient care is significantly reduced. Remote monitoring of patients can further improve the efficiency and level of care provided. Respiratory care staff can assess more patients in a shorter period of time, attending those who require assistance only when needed. However, the penetration of remote monitoring-enabled solutions has been slow to date due to security concerns about the use and storage of patient data.
Increased sophistication of home care devices and better understanding of the benefits associated with home care have allowed growth in the home care respiratory markets to continue. Stable patients are now able to receive a sufficient level of care in the home environment, driving the use of home care as a cost-containment strategy. For example, in the ventilator market, the use of non-invasive ventilation is increasingly accepted, with numerous studies proving that it is sufficient to treat stable patients. Also, patients experience an improved quality of life by receiving care in familiar surroundings, which can help to improve compliance.
In the sleep market, the use of home diagnostic testing can significantly reduce the overall cost of diagnosis; home testing devices are far less expensive than those used in the clinical setting, and do not require a sleep technician for the duration of the test. Home sleep testing is now considered sufficient in the United States for a diagnosis of sleep apnea; where previously a secondary, laboratory-based test would have been required. This highlights how home care is becoming regarded as sufficient, as cost continues to influence the healthcare market.
Improved compliance to reduce patient readmissions
Although treating patients in the home plays an intricate role in the effective management of the growing patient population, patients are required to maintain their therapy in order for this to be successful. Patient readmission is a huge burden to healthcare providers. Initiatives to improve the quality of care provided -- ensuring patients are well enough before they leave the hospital or clinic -- can only go so far to prevent readmission. Patients must be treated sufficiently to ensure that their condition does not decline further. In the United States, methods to encourage healthcare providers to prevent readmission include financial penalties for readmission of COPD patients within 30 days of discharge. Proof of use of therapy devices is also required to gain reimbursement, typically through remote monitoring of the patient.
This has led to demands from healthcare providers for manufacturers to provide solutions that encourage compliance. While financial penalties will drive healthcare providers to do all that they can to ensure patients use their therapy, the responsibility ultimately lies with the patient. Even in situations where the therapy provides an immediate and obvious benefit to the patient, for example, the use of CPAP therapy to enable patients to maintain breathing during sleep, compliance rates commonly drop to around 50 percent after the first year of therapy. This is common with home care solutions. Development of products to increase compliance has resulted in improvements to the fit and style of interfaces, particularly driving demand for full-face interfaces, which are the most popular in respiratory therapy. Ease-of-use is also important, particularly in markets where compliance is required for reimbursement, demonstrating how care is becoming increasingly patient-centric, to ensure long-term compliance.
Automation to reduce workload
The use of automated devices can improve patient experience, increase compliance, and reduce the workload of respiratory care staff. In the clinical setting, the inclusion of features such as closed-loop feedback in ventilation improves work-flow; devices automatically adjust based on the patient’s changing needs. This also improves the quality of care provided, as adjustments are instantaneous, ensuring the patient receives sufficient respiratory care at all times. Similarly, the use of auto-PAP devices for sleep therapy allows patients to receive the correct level of care, and reduces the frequency of visits required by the therapist. This is beneficial to the patient, but also improves the productivity of staff, making this therapy option more cost-effective than alternative CPAP therapy.
What does this mean for the respiratory care market?
Such cost-containment strategies continue to drive shifts in the market, with preferences moving from traditional diagnostic and therapy devices to simpler, less expensive alternatives. This is evident in the sleep diagnostics market, with the move away from complex, expensive laboratory-based diagnostic tests towards the use of home sleep testing devices. Meanwhile, in the therapy market, there is an evident shift from the use of CPAP to auto-PAP in the mature markets; IHS predicts that the CPAP market will decline for 2013 to 2018.
In the ventilator market, similar trends are seen with the continued uptake of home ventilation, and the use of sub-acute, long-term care facilities to transfer stable patients from the clinical setting. The impact on the use of critical care ventilators will be lower than hospital-based devices in the sleep market, as there will remain a patient population that requires high-acuity care.
Ultimately, IHS predicts that healthcare providers will continue to purchase the most cost-effective and efficient solutions available which, in this case, will drive the uptake of home care and automated devices. This is particularly important in the respiratory care markets, where a growing patient population will require forethought to ensure effective management.