How to Price a New Medical Device for Reimbursement Success
By Bruce Krider, MHA, American Healthcare Appraisal, (ahca.com)
Launching a new medical device isn’t just about innovation—it’s about ensuring your product gets paid for. Without a clear reimbursement strategy, even the most groundbreaking technology can stall in the market. Here’s how to build a pricing strategy that aligns with payer expectations, supports adoption, and drives commercial success.
🧠 Start with Reimbursement in Mind
Reimbursement isn’t a post-launch problem—it’s a design-phase priority. From the earliest stages, your pricing strategy should reflect:
Coding pathways (CPT, HCPCS, DRG) and whether new codes are needed
Coverage logic for Medicare, Medicaid, and commercial payers
Payment benchmarks based on site-of-care, clinical outcomes, and cost offsets
Successful medtech companies bake reimbursement into their clinical and economic evidence plans from day one.
📊 Build a Value-Based Pricing Framework
To justify reimbursement, your pricing must reflect the device’s clinical value and economic impact:
Time savings for clinicians and staff
Reduced readmissions or complications
Shifts in site-of-care (e.g., inpatient to outpatient)
Improved adherence or usability
Use HEOR (Health Economics and Outcomes Research) and real-world data to quantify these benefits. Payers want proof—not promises.
🧩 Align with Stakeholder Expectations
Your pricing strategy must resonate with:
Value Analysis Committees (VACs) who assess cost-effectiveness
Hospital procurement teams focused on cost containment
Payers who evaluate total cost of care and disease burden
Strategic pricing for new medical devices means understanding what each stakeholder values—and pricing accordingly.
🌍 Consider Global Pricing and Market Access
If your device will launch internationally, align pricing with:
Local reimbursement systems and coding logic
Reference pricing in key markets
Distribution and regulatory costs
Global pricing alignment avoids reimbursement delays and supports faster market penetration.
🛠️ Common Pitfalls to Avoid
Treating reimbursement as an afterthought—this leads to stalled adoption
Ignoring payer evidence requirements—without data, coverage is unlikely
Overpricing without clinical justification—this triggers resistance from VACs and payers
📞 Need Help Pricing Your Device?
At AHCA, we specialize in medical product launch pricing strategy and healthcare reimbursement pricing analysis. Our frameworks help innovators price for success—across clinical, commercial, and regulatory domains.