No systematic link between medtech innovation and increase in healthcare expenditure

Assessing impact medtech on rising healthcare expenditure requires looking beyond cost alone

MedTech Europe, the alliance of European Medical Technology Industry Associations, welcomes new research from the European Health Technology Institute (EHTI) confirming that there is no uniform relationship between medtech innovation and an increase in healthcare expenditure.

Serge Bernasconi, MedTech Europes Chief Executive Officer
Serge Bernasconi, MedTech Europe's Chief Executive Officer

The impact of medical technology on healthcare costs is a result of multiple, dynamic factors, such as whether a technology expands the number of treatable conditions, improves the capacity of the system to treat more patients, or extends life, inducing additional years of healthcare consumption. Consequently this impact varies greatly and can result in novel technologies being cost-saving, cost-neutral or cost-increasing.
At a time where public budgets have been under increasing pressure and scrutiny, public spending on healthcare has grown at a faster pace in the last decade than the economic growth. Although there is awareness of the impact of demographics and chronic diseases on the healthcare budget, progress in medical technology is often seen as a key driver of this rising healthcare expenditure. The findings of research by the European Health Technology Institute (EHTI), however, stipulate that viewing the relationship between rising cost and medtech as static and straightforward is not productive and a more balanced view is needed.

These findings of a broad literature review of 86 publications including both qualitative and quantitative research indicate that the relationship between rising healthcare expenditure and medical technology progress depends on many factors including the availability of alternative interventions, characteristics of the patient population, the treatment setting or whether the therapy is for a previously untreatable condition.
"A technology that increases costs in one setting or in one group of patients can be cost-neutral and even cost-saving under differing circumstances;" lead researcher Dr. Corinna Sorenson said on the EHTI research findings. "Moreover, even if a given technology increases costs, it may increase benefits by an even greater amount and therefore be considered a worthwhile investment. A sound and comparative evaluation of technologies is needed to optimise investments in healthcare."

The research also noted that the term 'medical technology' is often used in studies to cover a wide range of interventions, including novel drugs in areas such as cancer, many of which greatly add to costs. For medical technology not including pharmaceuticals, the healthcare budget invested has remained stable over the last decade.
"Our 5-year industry strategy, endorsed by our entire membership, confirms the medtech industry's commitment to value-based innovation as a way to steer Europe's healthcare systems onto a sustainable path while ensuring improved patient outcomes. To achieve this, Europe needs smart investment in health which also considers patient and broader socioeconomic benefits," said Serge Bernasconi, MedTech Europe's Chief Executive Officer.
In the Europe 2020 initiative policymakers call for the region to be a smart, sustainable and inclusive economy fuelled by a healthy population. The European Commission recognises that health is a precondition for economic prosperity and efficient investing in health can promote growth.
An ageing population, increased incidence of chronic diseases and greater patient demand will continue to be factors impacting healthcare expenditure. Only when we no longer see medical technology solely as a cost driver, but rather as a partner in Europe's health and economy will we be able to realise the promise of the Health Strategy.

  • Download the research “Medical technology as a key driver of rising health expenditure: disentangling the relationship”
  • Download the medical technology industry’s 5-year Strategy “Contract for a Healthy Future”
  • Download "Creating Value in European Healthcare" - Delivering on the promise of the Contract for a Healthy Future.


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