Real-World Data vs. Traditional Studies: What MedTech Innovators Need to Know

If you’re a medtech innovator, you’ve likely come across the term “real-world data/evidence” (RWD or RWE) in conversations about Medicare, which recently published guidance on a RWE framework. It’s an exciting development, but what exactly makes RWD different from running another study? Let’s unpack this together and explore how RWD could fit into your innovation journey.

What Makes Real-World Data Unique?

Real-world data comes from settings where healthcare happens naturally—electronic health records, claims data, wearable devices, patient registries, and more. It’s a reflection of care as it’s actually delivered, capturing all the complexities and messiness of real life.

In contrast, traditional studies like randomized controlled trials (RCTs) take place in controlled environments. They are designed to minimize variability and focus on proving efficacy and safety under ideal conditions. Both approaches have their place, but RWD gives us a broader and more practical perspective on how a device performs outside the lab.

The goals of RWD and traditional studies are also distinct. While traditional studies aim to answer whether a device works in a controlled environment, RWD asks a different set of questions: How does this technology perform in routine practice? Does it improve patient outcomes? Is it cost-effective? These real-world insights are critical, especially when engaging with payers who want to understand the practical value of your innovation.

Challenges with Real-World Data

While RWD offers exciting opportunities, it also comes with challenges. For medtech innovators, collecting high-quality data from diverse sources like electronic health records and patient registries can be complex and resource-intensive. Ensuring the data is standardized, validated, and free of bias requires significant effort and expertise.

From a U.S. payer perspective, the variability in RWD quality and the lack of consistent methodologies across studies make it harder to draw actionable conclusions. Payers also need robust evidence that directly ties the use of a technology to improved outcomes and cost savings—a threshold that many RWD studies struggle to meet due to confounding factors or incomplete datasets. Balancing these hurdles is critical for both innovators and payers as they work towards aligning evidence generation with coverage expectations.

How Do Registries Fit In?

When we talk about RWD, registries often come up as a central example. Registries are systematic tools for collecting data on patients who are using a specific treatment or device over time. They’re incredibly valuable for several reasons. First, they include diverse populations that mirror the real-world spectrum of patients—not just the ideal candidates selected for a clinical trial. Second, registries provide a longitudinal view, tracking outcomes over years to offer insights into long-term safety and effectiveness. Finally, registries are a go-to resource for supporting Medicare Coverage with Evidence Development (CED) and for making compelling cases to other payers.

Why Not Just Run Another Study?

If you’ve already completed traditional studies to secure regulatory approval, you might wonder why RWD matters. The reality is that payers like CMS aren’t just looking for efficacy under perfect conditions—they want to know how a device works in the real world. RWD helps answer questions that traditional studies can’t: Does this technology improve quality of life? Does it reduce hospital readmissions? Is it worth the investment? Moreover, leveraging existing RWD sources such as registries or electronic health records can save significant time and resources, letting you focus on scaling your innovation.

For many medtech innovators, the decision isn’t about choosing between traditional studies and RWD; it’s about finding the right balance. Traditional studies provide the foundation for regulatory approval, while RWD builds on that foundation to demonstrate real-world value. Together, they tell a complete story about your technology’s impact.

How Medicare’s RWD Framework Relates to Private Payers

Medicare’s framework for incorporating RWD offers useful guidance for medtech innovators, but it’s important to recognize its limitations when dealing with private payers. Historically, private payers have used Medicare policies as a benchmark, but this has become less common in recent years. Many private insurers have invested heavily in their own evidence analysis processes and platforms, tailoring their frameworks to the specific needs of their member populations. While Medicare’s guidance provides valuable structure, private payers will reserve the right to evaluate technologies based on their own criteria. For medtech innovators, this means that while aligning with Medicare’s RWD expectations is a great start, additional effort may be needed to meet the diverse and evolving requirements of private payers.

The Bottom Line for MedTech Innovators

RWD is not just a buzzword; it’s a powerful tool for bridging the gap between clinical trials and real-world care. It complements traditional studies by offering a practical perspective that resonates with payers, providers, and patients alike. If you’re considering how to incorporate RWD into your strategy, think of it as an opportunity to show the full picture of your innovation’s potential—not just in theory, but in practice.

Nicole Coustier has been helping medtech companies achieve widespread coverage and reimbursement for their innovations with US health plans for over 20 years. If you would like to set up a call to brainstorm your evidence options, set up a time here.