Beyond the Hype: Valuing New Medical Technologies in a Changing Market

In my career, I’ve sat on both sides of the table. As a former investment banker at Credit Suisse, I built financial models to determine the value of healthcare companies based on EBITDA and market strategy. Today, as a practicing radiation oncologist and Chief of Radiation Oncology at Luminis Health, I sit at the bedside, where "value" is measured in tumor control, reduced toxicity, and a patient’s ability to return to their life.

The tension between these two definitions of value—financial return versus clinical benefit—is the central challenge of modern healthcare. We are living through a technological renaissance in oncology, from proton therapy to adaptive radiation. Yet, in a market rapidly shifting from fee-for-service to value-based care, the coolest technology is irrelevant if we cannot build a sustainable reimbursement model to support it.

The Valuation Paradox

When I advise the C-Suite on capital purchases for our cancer service line, the question isn’t just "Does it work?" The question is, "Does the payment model support the practice change required to use it?".

In the traditional fee-for-service world, we were incentivized to treat more. If a new machine allowed for more fractions (treatments), it was financially viable. But the market is changing. We are moving toward models like the Radiation Oncology Case Rate (ROCR), an initiative I have championed heavily through my work with ASTRO.

ROCR represents a paradigm shift: paying for the patient, not the fraction. In this environment, a new technology is "valuable" only if it improves outcomes or efficiency—not just volume. This fundamentally changes how we must evaluate innovation. We can no longer afford technology that increases costs without a commensurate increase in clinical value.

Inside the "Sausage Making" of Reimbursement

Often, physicians view billing codes as static numbers that just "appear." In reality, the valuation of medical technology is a rigorous, negotiated process—a process I’ve often described as "how the sausage gets made".

Through my role on the AMA’s Relative Value Update Committee (RUC) and as Chair of ASTRO’s Health Policy Council, I’ve seen firsthand that innovation dies without a CPT code. You can invent a revolutionary device, but if it doesn't fit into the coding hierarchy—or if it gets caught in the crosshairs of budget neutrality cuts—adoption will stall.

For example, we are currently navigating how to value adaptive radiation therapy and radiopharmaceuticals. These aren’t just new tools; they are new workflows requiring massive physician and physicist effort. If we don’t accurately capture that effort in the valuation process, we risk creating a system where high-quality care is financially unsustainable for community practices.

The Physician Executive’s Role

This is why I believe the "MD/MBA" skillset is no longer a luxury; it is a necessity for leadership. We need leaders who can bridge the gap between the clinical mission and the financial reality.

When I evaluate a new service line—whether it’s establishing a new freestanding center or developing a low-dose radiation program for benign diseases—I have to wear both hats. I have to ask:

1. Clinical: Does this improve the standard of care?

2. Financial: Can we model this to survive 23% cuts in Medicare reimbursement?.

3. Strategic: Does this align with our shift to value-based care?

The Path Forward

The market is unforgiving, but it is also ripe for opportunity. The future belongs to technologies that drive value—that lower the total cost of care while improving survival and quality of life.

For my colleagues, investors, and policymakers: stop looking at the sticker price of the machine. Start looking at the reimbursement architecture that surrounds it. That is where the real value—or the real risk—lies.