Medical Device Manufacturers as Providers: A New and Emerging MedTech Model

Randy Horton

Published on: August 6th, 2025

Executive Summary

Medical device manufacturers (MDMs) are increasingly stepping into provider roles. This shift represents an evolution in MedTech business models, which leverage software, data, and connectivity to improve the delivery and impact of MedTech in patient care. This strategy extends access to care, streamlines the delivery of that care, and ties device performance closely to patient outcomes while building sustainable businesses that align clinical impact with commercial success.

In this webinar, leaders and pioneers from Australis Scientific and Corvista Health explored the key reasons why this is an accelerating trend: cloud platforms and connectivity, lower-cost sensors and miniaturization, changing reimbursement dynamics, and pressure to simplify workflows at outpatient sites. For manufacturers, the move requires new skills in clinical operations, billing, and data management. The rewards include earlier patient access, richer data, and recurring revenue. The challenges include site of service rules, evolving AI valuation, and the complexity of running services at scale.

A key lesson from early movers is that reimbursement must be treated as a design parameter, not an afterthought. Scalable billing infrastructure, evolving AI policies, and market-specific approaches are important for long-term viability. The financial sustainability must also be paired with a digital foundation that makes these services scalable and compliant.

The panelists emphasized four key themes:

Care is moving closer to patients
Reimbursement must be built into products from the outset
Data is a strategic asset
Cross-functional teams are essential

Together, these themes highlight how device makers are redefining value delivery.

Why Manufacturers Are Expanding Into Care Delivery

Selling devices alone does not ensure adoption or sustained use. To succeed today, manufacturers sometimes find that they need to bundle their devices with clinical services that make them more practical for providers and accessible to patients.

Local access matters. Corvista compared health systems to hubs and spokes, noting that many patients are funneled into costly hospital hubs when care could be delivered closer to home. By enabling diagnostics at outpatient clinics and rural sites, manufacturers can keep patients local, cut costs, and shorten delays.
Capital costs create barriers. Smaller clinical sites often cannot afford high-cost machines, which is why device-as-a-service models can serve as an alternative to traditional capital expenditures, offering a blended package of hardware, software, and operational support.
Multiple stakeholders require coordination. In modern workflows, the person who runs a test isn’t always the one who interprets it. Manufacturers can step in to coordinate across those roles, reducing friction for providers.
Cloud computing makes it all possible. With reliable connectivity and modern computation, manufacturers can now deliver complete services that include device oversight, clinical reporting, and billing support.

Real-World Examples of Hybrid Models

Australis Scientific – Urology Therapeutics

Australis’ Confidence Smart Patch for percutaneous tibial nerve stimulation (PTNS) addresses a long-standing challenge in treating overactive bladder and related urological conditions. Traditionally, PTNS requires weekly in-clinic needle placement. Their device combines anatomical landmarking tools, sensors, and a mobile app, allowing patients to safely self-administer the device at home, with impedance checks ensuring proper use. Clinicians then provide oversight through telehealth or asynchronous review, supported by continence nurses for technical assistance. This reduces clinic visits from 45 minutes to roughly 10 minutes of remote reviews, with potential for near-instant oversight in the future.

“For clinicians, what we provide is a technology that allows them to treat patients better in their own homes, rather than in their clinic, and we turn that around from a 45-minute weekly session with a patient into a 10-minute screening virtually.” – Nick Agahari

Corvista Health – Cardiovascular Diagnostics

Corvista extends diagnostic capability to outpatient “spokes” rather than concentrating in hospital hubs. Their non-invasive device analyzes electrical and hemodynamic signals to assess cardiovascular disease, providing clinicians with actionable insights without the need for high-cost imaging equipment. Corvista CEO Adrian Lam described healthcare systems as “hubs and spokes,” where patients are often funneled unnecessarily into tertiary hospitals for access to advanced equipment. Many smaller sites lack both the equipment and billing systems needed for digital diagnostic services. To address this, Corvista bundles diagnostic technology with administrative services, including billing, under the Independent Diagnostic Testing Facility (IDTF) model. This enables clinics to access advanced diagnostics without incurring significant capital investments or administrative overhead. Adoption has been strongest where the administrative burden is reduced; providers care most about whether the technology is reliable and reimbursable.

“We actually need to be a provider, because number one, multiple archetypes of stakeholders use our product. Number two, it’s used in a place where there’s not a lot of capital equipment, and there’s no big budget. And so, in a way, there’s this trend from CapEx to OPEX.” – Adrian Lam

Reimbursement as a Design Parameter

Reimbursement often determines whether device-plus-service models can scale. Manufacturers must incorporate financial pathways into product design, rather than treating them as an afterthought. Getting reimbursement right shapes provider adoption, patient access, and long‑term sustainability.

Use existing codes when possible. Australis leverages an established CPT Category I code for PTNS, but must secure reimbursement that recognizes at-home sites of service.
Fill gaps when codes don’t exist. Corvista is still awaiting permanent coverage, so it currently performs billing services itself, sometimes with the support of AI automation, to bridge the gap.
AI creates valuation challenges. Traditional reimbursement models are designed to pay for minutes of human effort, not near‑instantaneous algorithmic analysis. Regulators are still working through how to classify and reimburse AI‑enabled services.
Geography matters. In the U.S., “site of service” rules often complicate reimbursement, whereas international markets tend to prioritize clinical outcomes over location, sometimes facilitating faster adoption.

Building a Digital Ecosystem

For manufacturers stepping into provider roles, building a digital ecosystem is not optional; it is the foundation that makes new service models scalable, compliant, and economically sustainable. A well-designed digital backbone ensures data integrity, supports regulatory requirements, and provides the operational visibility necessary to enhance both clinical outcomes and business performance.

Data is strategy. Systems must capture the chain of custody, audit trails, and permissions to ensure both clinical and secondary uses remain possible.

“The core baseline of all of that is having a good data chain of custody, right? Where did the data come from? Do you have access to it? Has it been altered in any way, shape, or form?” – Bernhard Kappe

Signals go beyond the clinical. Corvista collects multimodal signals, electrical and hemodynamic, while Australis turned a safety sensor into a continuous biomarker platform with potential to preempt symptoms like nocturia.
Compliance is measurable. Australis’ predicate in clinic PTNS shows under 50% adherence at one year. Australis’ patch and app can measure usage, deliver reminders, and flag lapses for timely intervention.. That compliance signal matters clinically and economically: it supports outcomes claims and sustains recurring revenue by demonstrating real-world therapy delivery.
Operational visibility adds leverage. Offering services provides manufacturers with visibility into operational bottlenecks, such as onboarding delays or claim preparation times that were previously invisible. Capturing those operational metrics lets teams improve workflows, reduce friction for provider partners, and strengthen the economic case for adoption.

Of course, digital infrastructure alone doesn’t drive adoption. It takes the right mix of people and expertise to bring these systems to life.

New Skills and Teams Manufacturers Must Build

MDMs now need to build capabilities that historically were outside their scope. Delivering services alongside devices requires expertise in clinical operations, reimbursement strategy, regulatory engagement, and data science, disciplines that extend well beyond traditional engineering and manufacturing.

The professional diversity of Corvista’s founding team illustrates this shift. It included a physician, a bioinformatician, an engineer, and a biologist, reflecting the broad mix required to develop both technology and service operations. Leaders often pivot between conversations with investors, machine learning engineers, and clinicians on the same day, underscoring the versatility needed to scale hybrid models.

The panel drew on David Epstein’s book Range, which highlights the power of broad, cross-disciplinary talent. This kind of range is critical when products span sensors, algorithms, workflows, and reimbursement mechanics. Several companies have already shown how combining technology, services, and talent can reshape markets.

Market Precedents and Case Snapshots

These companies illustrate how pairing devices with services can redefine markets, accelerate adoption, and strengthen reimbursement pathways.

iRhythm: The company expanded beyond device sales by offering reimbursable clinical reports, which helped build a massive ECG dataset. That dataset, in turn, enabled new licensing opportunities and additional service lines, supporting multi-billion-dollar growth.
TransMedics: Originally focused on organ transport devices, TransMedics expanded to provide comprehensive logistics and perfusion services. This shift changed its revenue profile and ultimately included acquiring an airline to integrate transportation into its model.
Australis & Corvista: Both are emerging examples of how at-home neuromodulation and spoke-first diagnostics can successfully connect devices to services and reimbursement, demonstrating the practical impact of hybrid models in practice.
SPARK Neuro: The company combines EEG with AI‑driven biomarkers to identify and monitor cognitive disorders. By pairing diagnostics with specialist evaluation services and payer/provider engagement, SPARK moves beyond hardware toward reimbursable care.

Together, these precedents demonstrate how layering services onto devices accelerates reimbursement, improves adoption, and builds long‑term sustainability.

Policy and Regulatory Signals

Policy and regulatory signals shape whether innovative device-plus-service models can scale. Clear rules on reimbursement, service delivery, and digital adoption set the boundaries for how quickly companies can move and how sustainably they can operate.

U.S. regulators are actively exploring ways to support earlier, out-of-hospital diagnostics and treatments. Agencies such as HHS, CMS, and FDA are investigating how to reimburse new models, rather than asking if they should be covered. At the same time, reimbursement frameworks for AI-enabled work remain unsettled, prolonging an existing obstacle to reimbursement.

Non-U.S. healthcare markets may prove more flexible. Instead of requiring site-specific justifications, such as whether a service is delivered in a hospital, clinic, or home, many international payers focus primarily on whether the intervention produces strong clinical and economic outcomes. Once value is demonstrated, reimbursement can often be applied across settings, which can accelerate adoption. Companies must therefore tailor their approach accordingly.

Practical Steps for Companies Considering This Model

Companies exploring hybrid device‑care models often ask where to begin. The following steps distill lessons from early movers into practical guidance for building sustainable, digitally enabled businesses.

1. Integrate reimbursement strategy into product design.
Companies should map billing codes, documentation requirements, and site-of-service issues early to ensure financial viability is built in from the start.

2. Treat business-model design as a part of R&D.
Companies should study how trailblazers structured reimbursement and scaling pathways, and adapt lessons to their own market context.

3. Build the digital backbone early.
It is important to establish secure telemetry, auditable data pipelines, and compliance-ready infrastructure before attempting to scale.

4. Solve provider pain points that providers cannot solve themselves.
Companies should offer services that remove barriers such as billing workflows or administrative burdens, while leaving clinical decisions to providers.

5. Assemble cross-disciplinary teams.
Recruiting “deep generalists” who can bridge engineering, clinical workflows, regulatory requirements, and business strategy is key to long-term success.

How Orthogonal Can Help

Integrate Business Models with Compliance: We align reimbursement, regulatory, and technical strategies so payer and compliance needs are embedded directly into product design and development.
Unify Teams Across Functions: We help engineering, regulatory, and business stakeholders work from a shared execution model, reducing friction and keeping innovation moving.
Build Scalable Data Ecosystems: We design compliant cloud architectures and digital platforms that capture, govern, and operationalize data, scalable from startup pilots to enterprise-grade systems.
Enable Sustainable Growth: By embedding compliance, safety, and scalability at every stage, we help organizations turn innovative devices into sustainable, patient-accessible services.

Watch Webinar Recording

Randy Horton, VP of Solutions and Partnerships, Orthogonal