Subscription Models for Recurring Medical Supplies: Benefits for Both Buyers and Sellers

The medical supply industry often provides services on a recurring basis. Healthcare providers specializing in specific services need the same products and services regularly. That is why subscription is a beneficial model in this industry.

In fact, platforms that provide healthcare products and services on a subscription basis help hospitals and other providers improve patient care and operational efficiency. For instance, Dexcom’s devices for glucose monitoring and accompanying cloud solutions make convenient and efficient monitoring more accessible. They help patients keep their glucose levels within range. Also, patient data is made available to healthcare providers for informed decision-making.

In this article, we discuss how subscription models work in the medical supply industry, the ways to implement healthcare subscription models, and the challenges they face. We also cover prominent examples that prove the potential of this business model for recurring medical supply. As a result, you will know the benefits and ways of implementing subscriptions when building your SaaS product.

How subscription models work in the medical supply industry

Subscription as a business model is used in different platforms. When you think of services provided based on subscription, Netflix or Spotify come to mind first. But those are not the only cases. In fact, providing software and services for a recurring monthly or yearly payment is a go-to monetization resource for many companies.

As a SaaS development company, we’ve seen how businesses aim to deliver value with their cloud solutions for a subscription. In the medical supply industry, the subscription model also took off.

Subscriptions for medical supply buyers

• Patients with chronic diseases require ongoing services, and healthcare organizations buy products for their work time after time. Thus, medical product and service providers implement the subscription not only for savings but for timely technical advancements, similar to SaaS platforms.

Subscriptions for medical supply vendors

• Traditional sales cycles for medical suppliers included long-time research and manufacture, which was concluded with a revenue spike when the product was sold. Then, the cycle repeated. In contrast, the MedTech-as-a-Service (MTaaS) model embraces research, manufacturing, maintenance, updates, and other services users would need while applying the product on an ongoing basis.

This service bundling ensures recurring revenue in healthcare, flexibility in product and service delivery, and other benefits, both for providers and buyers. Let’s discuss them in more detail.

Read also: 30 SaaS Application Ideas for a Profitable Product in 2025

Benefits of subscription models for medical supply buyers

Cost predictability and financial flexibility

The major users of MedTech-as-a-Service are healthcare providers who use medical equipment to perform examinations. Traditionally, hospitals have to buy equipment for their operations. These expenditures are classified as capital expenditures (CapEx), and the assets are then depreciated over their useful life. CapEx spreads the tax deductions over several years.

On the other hand, MedTech subscription services allow healthcare providers to enter into agreements and pay regular fees for access to medical devices and associated services. These fees are categorized as operational expenses (OpEx). They are taxed in the same fiscal year, helping organizations deduct taxes at once and reduce their tax liability.

OpEx allows for manageable, periodic payments, in contrast to the substantial upfront costs of CapEx. Thus, OpEx offers simplified budget management, a quicker approval process, and faster access to tech advancements. Moreover, as subscription fees are planned ahead, healthcare organizations make informed decisions on their expenses.

Access to the latest medical technologies

The development of technologies moves fast, and what was an innovation recently becomes deprecated in the near future. Regarding the demand for innovative treatment methods in healthcare providers, access to top-notch advancements is a necessity.

Thanks to subscriptions, advanced functionality is not only accessible but also expandable within the subscription. Thus, a hospital can provide better care at an even better cost compared to traditional equipment investments.

What adds to better patient service with a subscription is automating processes. Thanks to digital solutions, which can also be equipped with AI, healthcare organizations leave tedious tasks to be automated and, thus, free resources to pay more attention to patients and their needs.

Strengthened supplier partnerships

Subscription models must provide ongoing value to help retain customers. As healthcare organizations need to get ongoing value, subscription providers aim to improve their services to meet those requirements.

As the vendor provides ongoing updates and scalability, their relationship with a buyer is a partnership, not a commitment for a one-time transaction. Therefore, this is a mutual process where buyers gain stronger connections with suppliers who offer constant updates, scalability, and relevant services.

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Advantages of subscription models for medical supply sellers

Predictable and recurring revenue streams

Compared to other business models, like commission, for example, subscription relies on providing constant value. It guarantees that buyers will gain that value for a stable recurring payment. The greater the value, the larger the customer base, and the more stable the income to a vendor.

Thanks to constant cash flow, vendors can plan their resource allocation, get operational stability, and build longer customer relationships. Thus, along with the main offers, vendors can provide additional products and services and increase their revenue even more.

Enhanced customer relationships

Subscription models help sellers to enhance customer relationships through several key mechanisms:

• Continuous services convert into long-term partnerships and engagement;
• Consistent quality and timely delivery from vendors build trust and strengthen loyalty to their brand;
• Ongoing subscriptions provide insights into customer preferences and behaviors;
• Based on customer feedback and data insights, vendors can make experience with their service more helpful and personalized.

Improved demand forecasting and inventory management

As buyers outline their needs in the subscriptions, sellers can predict order volumes and items to be supplied. These forecasts help vendors keep inventory in the right volumes, avoiding excess or shortages. Moreover, with a steady revenue stream from subscriptions, vendors can better predict cash flows. So, they get facilitated and more effective budgeting and financial management.

Medical supply subscription benefits also provide for efficient stock control. Knowing the exact quantity of products that subscribers need enables sellers to maintain optimal inventory levels. This precision leads to cost savings and improved operational efficiency in medical supplies.

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Implementing subscription models: key considerations for vendors

Providing a subscription for recurring medical supplies must be beneficial for both buyers and vendors. Below, we discuss the main considerations that help sellers provide better value with subscriptions and win and retain customers.

Customization and flexibility

Healthcare providers that use subscriptions vary in size, specialty, and patient needs. Therefore, vendors should tailor subscriptions to those variations. Here is how vendors can do that with customizable and flexible plans:

• Meet diverse needs. Suppliers should provide customized subscription plans to help healthcare providers address specific needs and ensure that each healthcare provider receives the products and services they need. Thus, personalized and scalable services will help vendors improve their retention rates.
• Support better health outcomes. As healthcare providers invest in subscriptions, they should gain access to services and products that directly align with their patient care needs. As a result, subscriptions can support more effective treatments and interventions, leading to improved patient outcomes.
• Increase engagement and loyalty. If a vendor provides high-quality services that meet buyers’ specific demands, it strengthens partnership relationships. Thus, buyers will renew their subscriptions from their preferred vendors.

Technology and infrastructure

Vendors will be able to provide robust and tailored services if they use proper technologies and infrastructure. Here are essential aspects of choosing technology and infrastructure that help deliver high-quality subscription services to healthcare providers.

Technology

Subscription services should be tailored to buyers’ needs and offer personalized services. However, we can name several must-have features that a vendor should include in their tech services to meet healthcare providers’ expectations:

• Electronic health records (EHR) integration. This integration enables vendors to get timely updates on patient care protocols and adjust their services accordingly.
• Health data interoperability. By following the interoperability standards, such as Health Level Seven (HL7), you ensure data exchange between different healthcare systems and reduce errors.
• Advanced customer relationship management (CRM) systems. These provide automated scheduling, follow-ups, feedback collection, and tailored customer support.
• Comprehensive analytics and reporting tools. These help vendors gain insights into service, forecast future trends, anticipate provider needs, and adjust services accordingly.
• Implementing AI. Thanks to advanced algorithms, AI enhancements provide operations efficiency, improved data management, and personalized experiences.

Further reading: How Much Does AI Cost in 2025?

Infrastructure

From our experience in DevOps services, we recommend you use cloud infrastructure as it facilitates scalable and flexible storage for extensive healthcare data. For example, AWS (Amazon Web Services), Microsoft Azure, and Google Cloud Services provide robust and flexible infrastructure used by companies of various sizes and needs.

Also, vendors should implement robust encryption methods, strict access management, and well-thought-out billing systems. Those safeguard sensitive patient information, ensure compliance with data protection regulations and allow for flexible and timely financial transactions.

Regulatory compliance

Vendors who provide subscriptions for recurring medical supplies must adhere to specific standards. These include the following:

• Health Insurance Portability and Accountability Act (HIPAA) compliance. Vendors must implement safeguards to secure electronic protected health information (ePHI). In addition, vendors handling ePHI are considered business associates and must enter into Business Associate Agreements (BAAs) with covered entities. Also, vendors operating in the US must adhere to local state laws regarding the healthcare industry.
• General Data Protection Regulation (GDPR), European Health Data Space (EHDS), and National Laws on Electronic Health Records. These are the primary regulatory standards for health data management in the EU. They ensure that electronic health records are maintained securely and are interoperable within the European framework.
• Vendor credentialing and oversight. Healthcare organizations often require vendors to undergo credentialing processes and verify their qualifications, compliance with regulations, and adherence to facility policies.

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Challenges and solutions in subscription-based medical supplies

Managing upfront costs

Implementing subscription-based models for medical supplies offers numerous benefits, including predictable costs and efficient operations. However, managing upfront costs remains a significant challenge for both providers and suppliers. Our experts explore these challenges below and propose potential solutions.​

Vendors face the following challenges regarding upfront costs:

• Initial infrastructure investment. To get their service up and running, vendors must invest in technology infrastructure for billing and inventory management. Also, transitioning to a subscription-based system may involve training staff to manage new processes.
• Financial risk and cash flow concerns. The subscription model often involves receiving smaller, recurring payments over time. It may delay ROI compared to traditional sales.

Solutions for vendors to manage the upfront investment:

• Adopt a phased implementation approach. Start the subscription model with a pilot program. It will allow you to test and refine without committing extensive resources upfront. A vendor can start their solution as a minimum viable product. Then, with gradual scaling, it is possible to add more features and manage costs and resources effectively.
• Use hybrid monetization models. These combine traditional sales and subscriptions. The combination will help the vendor to transition or choose those that work best.

Challenges in costs that buyers face when choosing the subscription:

• Budgetary constraints. Healthcare providers may face difficulties reallocating budgets from CapEx to OpEx, especially when existing financial structures are rigid.​
• Long-term commitment. Subscription models often require long-term contracts. It can be daunting for healthcare providers who are uncertain about future needs or financial conditions.

Solutions for buyers to handle upfront costs:

• Flexible subscription plans. Healthcare providers can choose vendors that can offer customizable subscription options. They will align with the specific needs and financial capabilities of buyers.
• Choosing subscriptions with flexible conditions. To ensure flexibility and scalability of service, buyers can opt for vendors who provide subscriptions with changeable services that adapt to buyers’ needs.

Ensuring product quality and consistency

High-quality products and services are paramount as they directly impact patient safety and healthcare outcomes. Here is what medical supply vendors and buyers face in terms of quality and how they can deal with it.

Vendors face the following challenges regarding medical product quality:

• Fluctuations in raw material quality or manufacturing processes can lead to inconsistencies in product quality;
• As demand grows, scaling up production without compromising quality becomes challenging;
• Adhering to international standards like ISO 13485 requires rigorous quality management systems;
• Ongoing compliance efforts are necessary to pass regular inspections by regulatory bodies.

Here are solutions for vendors to maintain the high quality of products and services:

• Achieve ISO 13485, MedAccred, and other relevant certifications and conduct internal audits;
• Conducting internal audits helps in early identification and correction of quality issues;
• Implementing strategies for healthcare supply chain management avert potential quality issues before they arise.

Challenges for healthcare providers in medical supply quality:

• Dependence on vendors and assessing the quality management practices of vendors can be challenging;
• Difficulty in tracing products back to their manufacturing batches can complicate recalls or quality assessments.

Solutions for healthcare buyers to get supplies of high quality include the following:

• Evaluate suppliers based on their quality management certifications, compliance history, and performance metrics;
• Conduct periodic reviews of supplier performance to ensure ongoing compliance with quality standards;
• Use systems that provide real-time data on inventory levels and product origins;

Set up notifications for product recalls or quality issues to facilitate prompt action.

Case studies: successful subscription models in healthcare

MedTech companies adopting recurring revenue models

Medtronic

The company provides subscriptions for using insulin pumps and continuous glucose monitors (CGMs) for people with diabetes. This computerized diabetes management technology helps patients stay in range and avoid sugar highs and lows.

Emergo by UL

It is a platform that provides comprehensive SaaS solutions to help companies monitor and meet compliance requirements. The solutions include OPUS (Optimal Product Usability Suite) and RAMS (Regulatory Affairs Management Suite). OPUS provides access to human factors engineering (HFE) intelligence and trains medical product manufacturers’ teams on product quality and compliance. RAMS helps with medical device regulatory compliance and market insights.

Philips Healthcare

Philips MR Subscription is an example of Device-as-a-Service in healthcare. The company offers MRI machines through a subscription service that includes medical equipment leasing, ongoing maintenance, and software updates. The subscription helps customers reduce their operation costs by 7%, increase MR usage efficiency by 29%, and increase revenue by 35% over 5 years.

HealthCatalyst

The platform provides a data and analytics ecosystem for health information exchange, centralized data governance, and many more use cases for healthcare. AI used in the solutions is trained and adjusted specifically to healthcare services. Thus, healthcare providers save millions thanks to safety improvements, optimize healthcare cost management, and avoid millions in penalties, as the company’s case studies show.

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Healthcare providers benefiting from subscriptions

Bupa UK

It is a British multinational health insurance and healthcare company with over 43 million customers worldwide. Bupa UK has launched Well+, a doctor-on-demand subscription service for both individuals and corporate employees. This service offers same-day GP appointments via phone, video call, or in-person consultations. Subscribers gain quick and convenient access to healthcare professionals, potentially enhancing early intervention and treatment.

Amwell

The company provides a subscription-based telehealth platform. It enables healthcare providers to offer 24-hour teleconference access to licensed physicians. The platform offers urgent care and online consultations on specialty care and behavioral health. Thanks to the subscription, qualified and personalized help has become more accessible.

Read also: Mental Health App Development: Types, Cost, and Process

To wrap up: the future of subscription models in medical supplies

The medical supply subscription model, done right, provides better patient care for less upfront investment compared to traditional sales. Subscription-based healthcare solutions typically include regular updates and maintenance, ensuring the provision of top-notch equipment and services. Moreover, integrating subscription models with digital health platforms makes it easy to collect and analyze vast amounts of data. It will help vendors get buyer feedback and adjust their services as needed.

These crucial benefits of subscriptions in the medical supply industry ensure strong vendor-buyer relationships and high-quality care for patients.

If you have a medical supply project in mind that involves SaaS or online marketplace development services, we are eager to help you. With dozens of successful projects, we know how to use technologies to turn your idea into a successful medical supply solution. Check out our portfolio, and contact us to discuss your project.