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February 21, 2024
Who Pays for Healthcare AI (Part II)
Morgan Cheatham's Substack
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Summary
Part II of Morgan Cheatham's article on Healthcare AI pricing models explores five usage-based options: Linear, Volumetric, Bundled Usage, Managed Services, and Device-Maintenance. Each model's strengths, weaknesses, and appropriate use instances are discussed, along with examples of companies employing each method. Critical decisions that AI companies must make are outlined when choosing a pricing model, including defining a unit of value and relating value delivered to the pricing model. The article also covers the funding of linear, usage-based pricing models, managing value assignment, and consumer cash pay. Transitioning between models and potential challenges faced are also discussed.
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