I was recently asked about my predictions for the coming year. Here is one: 2017 is likely to be the year in which virtual health finally crosses the tipping point and achieves scale.
In my role, I am engaged with many disruptive industry trends across all sectors. One area where I have seen consistent advances has been the emergence of smart health technology. Health care has long been ripe for disruption and with consumers now using technology to meet many of their needs, we are well on the road to Health 2.0. The question is what will it take to get to real scale in the multi-trillion dollar global health industry?
Very soon the vision of virtual health will seem like it was always inevitable. Instead of being passive recipients of care, patients will become empowered consumers, with greater access to information and control over their decisions. Instead of being delivered only in hospitals and clinics, health care will become available wherever patients happen to be. In mature economies systems will need to contain costs as health care spending continues to rise. In emerging markets, where access remains an issue, mobile service delivery such as SMS campaigns and data collection will become more prevalent and is already taking off, for example across countries in Africa. No matter where, wide scale adoption of virtual health will enable approaches that are dramatically more cost-effective and efficient both for the consumer and provider.
The difference between virtual health and its model components is that virtual health represents a consolidated, integrated model of health service delivery. Its components include: online bookings and diagnostics; virtual patient communities; remote health service delivery (e.g. telehealth, monitoring, diagnostic results, robotics); machine-based diagnostics; electronic medication management; and readily available online information including personal health records, health provider information like reviews and ratings, and health product information like authoritative reviews of health apps.
Virtual health providers integrate many or all these functions into a coherent, patient-centric health service delivery model. The opportunities presented by virtual health have already seen a variety of new players enter health service delivery markets, including telecommunication and tech firms. And with an additional 2.6 billion smartphone devices set to enter the global market by 2020, demand for mobile health technologies is primed for take-off.
Are consumers ready and what is the growth potential?
Already, according to a 2015 survey, 62% of American consumers believe that a live mobile video consultation with a physician would more likely yield an accurate diagnosis than a phone, email or even an in-person visit. In a separate 2015 survey, 70% of Australian adults would use mobile technology to not only communicate with their doctor but also to order prescription drugs.
In spite of this demand, adoption of mobile health has remained elusive. But we are now at a turning point.
Revenue for video consultations, for example, is projected to rise from less than $100 million in 2013 to $13.7 billion by 2018 – with most revenues coming from health insurers as virtual consultations replace face-to-face visits. Over this same period, the number of US households using virtual health is forecast to rise from less than one million to 22 million.
Connecting the dots
Health care’s reinvention is being driven by two main factors: digital disruption and economic sustainability. In 2017 we will see greater alignment between these supply and demand drivers.
On the supply side – there have been advances in biomedical and health informatics technologies and standards, supported by public investment in health information infrastructure in most major markets. Health apps are expected to expand further into mainstream consumer markets, and reduction in regulatory and health financing barriers to entry has commenced. For example, a range of health insurers in the USA are now including virtual care in their reimbursement models.
On the demand side – demographic shifts and current spending levels are simply unsustainable. Consumers are seeking more productive delivery models in response to an estimated global health workforce shortage of 7.2 million workers. This shortage is contributing to the wide-scale increase of health care expenditures amid growing demand. By 2030 advanced economies face daunting projections with costs expected to approach: 25% of GDP in the USA, 17.5-18% in Germany and France; and 13.5% in the UK. Estimates demonstrate how virtual health will reduce these costs:
Virtual health is one such trend in an industry that needs to change. The greatest barriers to the scaling of new health service delivery models have been health financing systems and professional attitudes. Both are now shifting as a result of financial and consumer pressures. Newcomers are already entering the market and hence virtual health will be ready to scale from 2017.
This article is part of the LinkedIn Top Voices list, a collection of the must-read writers of the year. Check out more #BigIdeas2017 here.