Today I heard a new phrase. It's another reason why margins are ever tightening in the healthcare sector: the concept of negative goods.
Today, many healthcare companies feel the strain precisely because of 'negative goods'. Why? Because the products they are manufacturing today aren't things people want to buy. On the contrary, they're goods that people feel they:
- are entitled to
- would rather not have to spend money on.
And yet, they are saving people's lives!
A negative good, like medication, is "something we use or engage in because we have to, not because we want to."
So the reality is... Apple can keep charging more for their fashionable gadgets with very little push back, but it doesn't work when healthcare geniuses try and do the same. You see, healthcare is an entitlement people believe should be free. And gadgets? Well they are an extra we can pick or choose to have (or not have).
I think this resonated with me as I am definitely one of these people.
I know I would much rather spend the money on some material good I don't need, rather than something I need!
At OmPrompt we've already been able to help many healthcare companies:
- that work with tighter margins as the need grows
- as their geographical the remit increases,
- as the expectation of next-day delivery develops
- to process the transactions from the end-user that are arrive in whatever format that works for the individual customer.
Hopefully, we can now talk to our customers about "negative goods", and free up some resource to allow for this mentality.
An especially useful starting point for an aspiring healthcare company would be to think about ways to deliver a “positive good.” Most contemporary medicine is generally regarded, economically, as a negative good – something we use or engage in because we have to, not because we especially want to. While this creates a ready market, it’s also results in a tense and uncomfortable relationship between the “producers” of healthcare – who have often invested a significant amount of resources with the intention of making a profit – and consumers, who have little choice but to pay (or co-pay) for expensive care, and consequently tend to resent it.