Over the next decade, emerging technologies and Value-Based Care (VBC) will completely transform the patient experience.
Venture fundraising in healthcare reached $10.4B in the first half of 2020, equal to all of 2019’s record year. Then, in the first half of 2021, global venture capital funding for digital health companies reached $15 billion.
Moreover, competitors outside the traditional healthcare space such as Amazon, Google and Apple have each announced plans to enter the market to “re-invent” healthcare as the patient-first movement helps consumers select the most convenient and effective means to prevent and manage illness.
M&A activity in the space has also been fierce: Microsoft acquired Nuance for $19.7 billion, Optum bought Change Healthcare for $13 billion, Datavant picked up Ciox Health for $7 billion, and KKR added Therapy Brands to its portfolio at a cost of $1.5 billion. Then there’s Boston Scientific (which acquired Preventice Solutions for $925 million).
All of this activity is focused on the movement to measure patient outcomes (versus quantity of services delivered).
Leaders across the healthcare industry are recognizing the value in designing patient-centric administrative and clinical systems as the industry re-orients its value towards patient outcomes versus the quantity of services delivered. As hospitals and clinics embrace this trend, executives are also stepping up their use of data, digital and agile service design to reimagine the registration, admissions, clinical service delivery, discharge and post-discharge patient journey.
Over the next decade, even more investment will flow toward making the experience highly personalized, seamless, and transparent across every physical and digital touch point.
Hospitals and clinics will also increase their investments in new platforms and digital tools to help patients find and match with a provider that meets their specific needs, understands their insurance coverage and ‘out of pocket’ costs while letting them to make payments anytime using any device.
As all of these trends mature, insurers will leverage their legacy databases to build platforms around all aspects of health and wellness, particularly in the management of chronic conditions. Increased harness of data and personalization will also help healthcare executives reduce risk and increase reward across all patient segments.
Care will happen anywhere and everywhere.
A recent US study found that healthcare travel and wait times are higher than any other service industry, resulting in $89B in lost opportunity costs. Long wait times are propelling all segments, , especially millennials and the elderly, to place more value on convenience, as they become more comfortable using in-store medical clinics, on-premises health and wellness clinics provided by their employers, and telemedicine.
In the US, the annual opportunity cost for travel and wait time in health care exceeds $88 billion.
Hence, expect to see hospitals and clinics expand their ability to provide these kinds of services over the next decade, and for insurers to expand the kinds of services, platforms, locations and providers they will support. More and more preventive and minor acute care will be delivered virtually “at home” outside of the regular workday, by what is likely to be a larger and more diverse set of providers (e.g. pharmacists, nurse extenders, etc.).
Simple speech will deliver faster, more accurate diagnoses.
Over the next few years, physicians will routinely add speech analysis to their diagnostic toolbox (since the tone and words a patients uses is proving to be a reliable means for detecting potential issues such as depression, PTSD, mental illness, dementia — even heart disease).
Innovation in the use of digital speech to augment clinical diagnosis has become especially active in the startup community where technologists are finding less invasive ways to detect abnormalities — sooner, thanks to advances in AI and machine learning.
For example, speech pattern analysis (from patient audio samples) can augment, or even replace, labor-intensive diagnostic processes that require highly educated medical professionals. Such decreases in the reliance on highly-trained experts and difficult-to-locate clinicians will also lead to earlier diagnosis, which would reduce both costs and the stress of long, arduous patient treatment regimens.
Patients will increasingly rely on speech-enabled chat-bots to help them efficiently navigate through health systems. As these systems begin to incorporate AI-supported ‘deep learning’ capabilities, it’s only a matter of time before these chat-bots advance to providing preliminary diagnosis and present data-based treatment options that are physician-approved and immediately made available to a patient in real-time.
AI will continue to enable healthcare breakthroughs.
Advancements in AI, data science and smart machines, particularly their contribution to algorithmic medicine, will radically improve clinical care as important decisions are made faster and with greater accuracy. Of particular promise is the ability of AI-enabled algorithms to reduce, even eliminate, human clinical involvement in highly routine care. Such savings from technology will give physicians more time to study complex situations and focus on health outcomes and patient satisfaction.
In a 2018 Nielsen survey of digital healthcare, analysis of US federal health data shows that $7 billion of physician’s time could be eliminated each year by shifting office visits to home through virtual care.
Moreover, clinicians often order tests and procedures that aren’t medically necessary in efforts to avoid malpractice or to protect themselves in other ways. Virtual care, powered by algorithmic medicine, could go a long way to dilute, even eliminate this overly cautious behavior which is expensive, time-consuming and lacking in contribution to effective patient outcomes.
AI and algorithmic medicine also promises to reduce waste and eliminate duplicate tests through best-practice standardization. And, millions of ER visits will be reduced or even eliminated thanks to the early detection from AI-enhanced virtual care.
Are Consumers Willing to Engage Virtual Assistants in Healthcare?
61% would use a virtual health assistant to estimate costs, schedule health care appointments and explain benefit coverage, bills and payment options.
55% would engage a virtual nurse to track medications and vital signs.
50% would use a virtual clinician to diagnose health issues and navigate them to the treatment options.
Source: 2018 Survey on Digital Health
Healthcare platforms will be more connected, collaborative and integrated.
Next-generation platforms will advance personalization as sensors and health tracking apps, embedded in IoT devices, collect data and alert patients and providers to precursors of disease. These advancements will enable earlier detection, prevention and slowing of progression. New platforms will also alert patients to changes in vital signs and body chemistry that may be leading indicators to more acute disorders. Hence, patients will immediately be provided with information, recommendations and options for preventing the onset of disease before it occurs.
As innovations such as IoT mature, healthcare platforms will evolve to help physicians and their teams get in front of illness faster and with greater confidence — to the benefit of all.
Take chronic disease, which is both costly and time-consuming for patients. Only 56% of such patients receive recommended preventive healthcare services to treat conditions such as arthritis, cancer, diabetes, depression, and heart disease. That could dramatically change under a Value Based Care system designed around a team’s ability to achieve measurable improvements from a more comprehensive approach.
Only 56% of chronic disease patients receive recommended preventive healthcare services to treat their condition.
Moving forward, providers will need to invest in cultural reform.
As the migration from a fee-for-service system to fee-for-value system evolves, healthcare executives will put priority investment on the many organizational challenges that will need to be addressed. Value-Based Care has been enthusiastically embraced by the medical community as an effective way to reduce costs while increasing the quality and outcomes of healthcare.
However, a value-based model won’t succeed if healthcare executives don’t reform cultures that improperly value procedure quantity and revenue over prevention. In the spirit of innovation, hospital executives will need to create more cross-functional, cross-discipline teams staffed with para-professionals while. Smaller hospitals will also advance the trend toward outcomes-based care, as they tend to be more agile than larger organizations.
Providers will form alliances to advance innovation.
Healthcare executives should pay particular attention to the trend toward more vertical integration between retail, payers and providers as it gains momentum. Mergers and other collaborations that bring together firms in vertically adjacent industries — for example, CVS/Aetna and Express Scripts/Cigna — will continue. While health systems are just beginning to experiment with offering their own integrated insurance products, significant progress will made over the next ten years, potentially leading to a merger between one or more large health insurance company and large regional or national health system by 2030.
We can also expect half of all healthcare delivery organizations to ally with Google, Apple and Amazon in their clinical diagnostic and treatment processes over the next decade. Will these digital giants become partners, collaborators or competitors? While the answer to this question is still evolving, we advise healthcare executives take the trend seriously as these new entrants will surely impact the ways we access and pay for healthcare services. We will continue to provide insight and advice around the changing landscape as established digital players and innovative entrepreneurs alter the $3 trillion healthcare ecosystem.
During the next decade, healthcare delivery organizations should take advantage of data from Google, Apple and Amazon to inform their clinical diagnostic and treatment processes.
Precision medicine will be particularly transformative.
This trend will go a long way to delivering on the promise of personalization as it embraces the patient’s genealogy, physiology and real-world lifestyle behavioral data into treatment and prevention.
Precision medicine has been growing steadily, first from the 2015 Precision Medicine Initiative in the US followed by the 21st Century Cures Act. By adding RWD elements to the patient’s genomic sequencing, skin, respiratory, and intestinal attributes, physician’s will diagnosis and prescribe treatment faster and with higher accuracy. RWD insights will also include data from mobile health and fitness apps, wearables and remote monitoring devices. While many of these technologies are in use today, it will likely be 10 years before these attributes become a routine medical practice.
Expect to see 3D printing create functioning human tissues.
3D bioprinted organ transplants are another exciting development we are tracking. This technology, which will have transformative impact on the entire ecosystem, got a boost in 2016 when Jennifer Lewis (Sc.D. of the Harvard Wyss Institute) announced it was developing and integrating multiple functional materials within printed devices.
Lewis’ researchers have developed six different inks to integrate soft strain sensors within tissue microarchitectures, which it has printed onto a cardiac micro-physiological device (essentially creating a heart on a chip). The Wyss team has also developed organ chips that mimic the microarchitecture and functions of muscle, tongue, lung, intestine, kidney and bone marrow. We believe 3D bioprinted organ transplants, that products that function like human organs, represents one of the ultimate transformative breakthroughs in digital healthcare.
Then there’s blockchain.
While the business case for blockchain in healthcare is still an active debate, its benefits are clear in its potential to streamline transactions and facilitate information sharing among all healthcare value chain participants (from contracting, credentialing and claims payment, to health data aggregation and analysis, and population health management).
Solutions are already being developed to collect and manage provider data and credentials; as these efforts mature, we expect the technology will be extended to other administrative activities and transactions before clinical uses are addressed. Stayed tuned to our insight and advice as we continue to monitor developments in blockchain use cases across the entire healthcare ecosystem.
One wild card looming over the entire industry is the volatility of the current legislative and regulatory environment.
Adoption of Medicare-for-All or a Single Payer solution, whatever form it might take, will send shock waves through the entire industry. Should this occur, we predict many of these technologies and trends will mature even faster as the reshaped market increases demand for data, integration and experiences produce outcomes that are more personalized, efficient and effective.
Learn more from these sources:
9 examples of disruptive innovations in healthcare, Dignity Health.
It’s time to disrupt the $3 trillion healthcare industry, by John Scully, Forbes, 16 November 2016.
Time to Travel and Wait in Health Care: The Opportunity for Self-Care at Home, by Jane Sarasohn, Health Populi, 26 February 2019.
The State of Value-Based Care: 10 Key Trends to Know, by Fred Pennic, Evernote,
Consumers want virtual care, by David Barkholz, Modern Healthcare, 10 February 2017.
Augmented Intelligence: virtual assistants come to healthcare, by Greg Kuhnen and Andrew Rebhan, Advisory Board, 10 July 2018.
How Voice Recognition Technologies Can Be Used to Accelerate Patient Trials, by Ken Fabianovicz, Applied Clinical Trials, 27 September 2017.
A Step Forward in Building Functional Human Tissues, eHealth News, 13 October 2016.
Amazon, Google and Microsoft Aim to Fix Healthcare, by Gene Marks, Forbes, 19 August 2018.
The 21st Century Cures Act, by Michael Gabay, National Institutes of Health (NIH), April 2017.
What is the Precision Medicine Initiative? US National Library of Medicine, NIH, 26 February 2019.