Getting Ready to Launch a New Product? Don't Make Either of These Timing Mistakes

Developers and entrepreneurs spend months or even years preparing their product for market introduction. A danger they face is misjudging when to launch. They must heed the old saying, “You only have one chance to make a first impression,” but some may obsess over this too much and, therefore, delay their product’s introduction longer than necessary. This can lead to losing the first-in-market advantage and/or missed sales. However, in an attempt to beat the rest of the market, other vendors make the mistake of launching prematurely, with sometimes-devastating results.   

Do you remember Apple’s disastrous 2012 launch of its new Maps app? It worked perfectly unless you didn’t want to have to find a train station in the middle of lake or were confused by aerial-view interstate maps that resembled overcooked spaghetti. Once a product gets cast as inferior, it can take years to recover. Some never do.

In order to avoid this mistake, some companies overcompensate and wait too long. This potentially creates two problems:

·         If your product is groundbreaking or transformational, a delay gives competitors extra daylight, and you could forfeit your “first to market” advantage.

·         Delays slow down cash flow, something which can prove fatal to a cash-starved startup.

Recommendation:  If you are introducing a groundbreaking service or product, seek the sweet spot where your minimally viable product performs all its essential functions adequately yet still gives you a head start in the market. A product that does exactly what it purports to do – even if it’s not particularly fancy – establishes your credibility and starts the cash flow so vital to continued development. If early adopters like what they see, they will likely talk your product up among their peers.

A Possible Compromise Regarding Healthcare as a Right

One of our thorniest health policy issues is whether or not healthcare coverage is a basic human right. Those who say “yes” feel that it’s immoral to deny anyone care. Those on the other side point to the economic challenges – including likely rationing – of providing expanded care for all. In this contentious, polarized political climate, it’s unlikely that either side will convince the other any time soon. But, if I may be so bold, there may be an acceptable compromise.

Before I present my idea, let’s consider three primary drivers that brought healthcare coverage into the public’s consciousness in recent decades.

·         Charges of hospital emergency rooms “dumping” patients in the 1980s. Some highly publicized cases where hospitals allegedly dismissed uninsured patients from ERs without properly stabilizing and treating them caused understandable public outcries and played a major role in passing the Management and Treatment of Active Labor Act of 1986 (EMTALA).

·         People being denied coverage or having extraordinarily high premiums because of pre-existing medical conditions.

·         People literally being bankrupted by crushing medical bills triggered by catastrophic medical crises.

Here’s my proposal. What if we had a two-part hybrid system?  

·         Part 1 – A national public plan that provides emergency/preventive/primary care and catastrophic care for everyone. It would be backed by a combination of increased employer taxes and redeployment of some existing funding for Medicare, Medicaid and the Children’s Health Insurance Program.  

·         Part 2 – A reconfigured private insurance market that offers coverage to fill the gap between emergency/preventive/primary and catastrophic care. This supplemental insurance would be paid for either by individuals who wish to purchase it or employers who want to provide extra coverage for their employees. Additionally, state Medicaid programs could help fill the gap for Medicaid patients if they so chose.

This approach would address all three problems listed above.  It would:

·         Guarantee coverage for life-threatening situations

·         Keep pre-existing conditions from freezing people out the insurance market

·         Minimize bankruptcies caused by catastrophic medical bills.  

Even though employers’ taxes would rise, their total healthcare spend probably would not.  Their increased taxes would be offset by decreased insurance premiums since they would no longer have to pay for the emergency/preventive/primary and catastrophic care they pay for in their current policies.  

Importantly, this concept also maintains a place for private insurance companies, who are understandably dead-set against a fully socialized program that would render them irrelevant. 

The “healthcare is a right” group should be pleased that everyone has guaranteed access to basic care, and those on the other side should see this as a more affordable option than all-out, expensive full coverage for everyone.  

Some might complain that this concept would establish a two-tiered system since not everyone would have the supplemental private coverage. But I would argue that in a free society, not everyone accesses the same products and services. That’s why we have both EconoLodge and Ritz-Carlton hotels. Furthermore, our current system does not adequately care for the needs of the “have nots.” This would at least be a good step toward more equity.

Let me know what you think.



As the ACO Program Illustrates, Mandates Only Go So Far

The following letter was printed in the "Comment" section of  the May 28, 2018 edition of MODERN HEALTHCARE magazine. 


The article “Rather than face risk, many ACOs could leave” (, May 14) illustrates the limits of top-down mandates.  Accountable Care Organizations can be a great way to improve patient outcomes in an economically viable way.  But between the CMS program’s constantly changing rules and increased pressure on ACOs to accept financial risk, it’s not surprising that some are re-evaluating the cost/benefit of the program and considering leaving.  

Additionally, the concept of assigning patients retrospectively makes no sense.  Expecting physicians to manage an undefined group of patients sounds like someone’s master’s thesis that somehow got implemented as policy. The first step in any management process includes defining upfront who and what you are trying to manage.  

We are seeing a similar pattern in the provider world, where many older physicians are deciding that the overhead burdens from MACRA and other regulatory requirements outweigh the benefits of remaining in practice and are retiring early.  

Those who want to prompt new behaviors have two choices:  Design something that achieves the program’s objectives while being acceptable to those on the receiving end, or make the changes mandatory and live with the consequences.


Glenn E. Pearson, FACHE

Principal, Pearson Health Tech Insights, LLC

Marietta, GA




MH ACOLEtter Cover May 28 2018.jpg

Will Value Based Reimbursement Finally Bend the Cost Curve?

On April 19, I had the pleasure of moderating a Georgia Association of Healthcare Executives panel addressing The Shift to Value-Based Purchasing.  Panelists were Ray Snead (Interim CEO, Grant Memorial Hospital in Petersburg, WV), Ellis “Mac” Knight, MD (SVP and CMO, The Coker Group), and Mike Cadger (Founder/CEO, Monocle Health Data).  

Ray Snead, Dr. Mac Knight, Mike Cadger, and Glenn Pearson

Ray Snead, Dr. Mac Knight, Mike Cadger, and Glenn Pearson

To kick things off, I observed that, over my 30+ year career, I have lived through various inflation control attempts:  DRGs, HMOs, Provider-Sponsored Organizations, and others.  Few would argue that the strategies of the last three decades have been a smashing success.  Thirty years ago, healthcare represented 11.0% of GDP, and in 2016 it was 17.9%.  Is Value-Based Reimbursement (VBR) just another in the long string of marginally successful efforts?

One of the great things about panel discussions is the variety of opinions.  True to form, our group had varying predictions about VBR’s ultimate impact.  Dr. Knight had the most positive expectations, while Ray Snead was more skeptical.  

Dr. Knight pointed to evidence from such risk-bearing organizations as Intermountain Healthcare whose emphasis on prevention and coordinating care has yielded modestly favorable results –  Intermountain’s ability to tamp down its inflation level to CPI plus 2%.  

As CEO of a small, rural hospital, Ray was not so upbeat.  Although all hospitals face daunting financial challenges, rurals seem unusually stressed.  The fact that rural hospitals are disproportionately represented in the hospital closure statistics demonstrates their extraordinary hardships.  Ray lives them out every day, and he is not all-that-optimistic about smaller hospitals (or, for that matter, safety net hospitals) being able to adapt the VBR model to their settings.

Although I appreciate the points Dr. Knight made, I lean more towards Ray’s position.  VBR is a great idea.  I’m all for stressing common sense preventive care and aligning incentives.  However, so many factors must be in place for true sustainable impact.  Among other things, hospitals need working relationships with primary care physicians, specialists, community-based services, and post-acute care providers.  Furthermore, patients and their families and/or extended communities must be actively engaged.  Tying all this together requires reliable wrap-around communications processes.  All this is challenging for many hospitals, and all-the-more so for rurals.

For years, I have suspected that the designers of each new approach to cost containment has a particular hospital profile in mind:  a medium-to-large hospital or health system, probably suburban-based and at least reasonably successful financially.  (Intermountain fits this description.)  Even though these systems may include rural hospitals, those rurals have the advantages of a deeper healthcare delivery system backing them up. 

I don’t want to in any way diminish the successes of Intermountain or others in response to VBR incentives.  However, I sympathize with rural and inner-city hospitals that face such extra challenges as poor payer mixes, difficulties in attracting physicians and other clinical personnel, typically out-dated facilities, and other problems.

So will VBR succeed in controlling costs?  I certainly hope so, but I think the complexities healthcare faces outstrip the ability of a single concept to deliver the silver bullet.

VBR Panel GP.jpg

Why Startups Fail

One of Facebook’s cool features is its habit of occasionally reminding you of your previous posts.  Our friends in Menlo Park recently notified me of a link to an article called The Main Reason Why Startups Fail I forwarded two years ago when my business – Pearson Health Tech Insights, LLC (PHTI) – was still relatively new.  (PHTI helps tech-oriented startups selling into the hospital world hone their strategies to maximize market success.)  As I re-read the article with two more years of helping clients under my belt, I was able to confirm just how easy it for a hospital-targeted product to get derailed.  PHTI’s tagline is If you build it, they might not come.   

The article’s author Gijs van Wulfen presents some sobering statistics.  He cites a study of 2,000 startups financed by venture funds between 2004 and 2010 that reports that an estimated 30% - 40% failed outright.  Only 60% lasted three years or more, and only 35% made it to ten years.  Van Wulfen also references a report by cb insights that presents the top 20 reasons why startups fail.  (Since failures are caused by multiple factors, the total percentages add up to over 100%.)  The top two reasons for startup failure were:

·         No market need – Cited by 42% of the failures

·         Company ran out of cash – Cited by 29%

Other factors were:

·         Poor product – 17%

·         Need for or lack of business plan – 17%

·         Poor marketing – 14%

·         Product being mis-timed – 13%

In addition to these factors which plague startups in any industry, companies selling to hospitals face additional challenges.  A couple of weeks ago, I met with the CEO of a leading medical device innovation center.  Her opening statement reflected what her organization has learned over the last few years.  She observed that most device developers clearly understand the following hurdles:

·         Achieving FDA approval

·         Understanding the reimbursement climate

However, she said they often overlook one that is equally important:

·         Figuring out how to get hospitals and clinicians to actually adopt their technology

And that brings me back to our tagline:  If you build it, they might not come.

PHTI can help any company targeting hospitals sharpen its approach and strategy.  Our signature offering is the Healthcare Marketing Tune-Up Program that consists of three parts:

1.  A review of the company’s products in light of the “7 Ps of Marketing” 

  • Product
    • Place (distribution methods)
    • Positioning
    • Promotion
    • Packaging
    • Price
    • People

2  Suggestions for avoiding the relevant pitfalls PHTI has identified from our list of 79 Pitfalls of Marketing to Hospitals

  • 3 Timing Pitfalls
    • 9 Credibility Pitfalls
    • 4 Product Design Pitfalls
    • 3 Market Misreading Pitfalls
    • 10 Data/Technical Pitfalls
    • 9 Communications Pitfalls
    • 14 Financial Pitfalls
    • 3 Legal/Regulatory/Bureaucracy Pitfalls
    • 2 External Political Pitfalls
    • 11 Internal Political Pitfalls
    • 11 Organizational/Operational Pitfalls

3.  A summary S/W/O/T analysis


Let us help you avoid becoming an unfortunate statistic.  Contact me at or (770) 861-6941.