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The Digital Transformation of Healthcare is Accelerating

The healthcare industry has long been known as a technology laggard. Physicians may be quick to adopt new diagnostic or treatment technologies and methods, but on the whole, the industry was slow to move from paper to electronic medical records. It was well behind banks, retailers, and others in providing web-based interactions for patients, and even today many systems are poorly integrated with duplicated and out of sync data.

But new innovations and customer appetite for a more digitally connected experience are forcing the industry to adopt a new, accelerated pace of change. A recent article in the Economist calls digital technologies, “The wonder drug.”

“Consumers seem readier to accept digital products than just a few years ago. The field includes mobile apps, telemedicine—health care provided using electronic communications—and predictive analytics (using statistical methods to sift data on outcomes for patients). Other areas are automated diagnoses and wearable sensors to measure things like blood pressure.”

Cardiac Arrest? There’s an App for That

One example that the article details is Amazon’s Echo, a voice-driven computer that goes by the name of Alexa. When someone goes into cardiac arrest, getting the heart restated quickly is the key to survival. The American Heart Association has taught Alexa how to recite potentially life-saving instructions about cardiopulmonary resuscitation. And that’s not all. Alexa is gaining the skills to answer a variety of questions about health conditions as well as to provide companionship for the elderly and homebound. This type of technology also has uses in medical offices and hospitals, allowing physicians to request diagnostic tests and take notes without removing gloves or washing. Alexa may soon even be reminding you to take your pills or go for a walk.

The Players Old and New

There’s no single type of technology or company that is driving this healthcare technology revolution. Rather, there are three types of organizations innovating in their own way:

  • Traditional healthcare-related organizations including pharmaceutical firms, hospitals and medical-technology companies such as GE Healthcare, Siemens, and Philips.
  • Payers such as health insurers, pharmacy-benefit managers, and as single-payer health-care systems like Britain’s NHS.
  • Technology companies such as Google, Apple, Amazon and a long list of smaller firms and start-ups that are creating apps, predictive-diagnostics systems, and new devices.

Some of these players are bound to reap huge profits from new products and services, while others may suffer. Drug companies, for example, may see the rise of new treatments and preventions that reduce the need for prescription medications.

Outcome-Based Measurement

One of the most important outcomes of the digitization of health records and the rise of big data analysis is the improved ability to truly understand which treatments work. The Economist explains,

“The threat to the traditional innovators is that as medical records are digitized and new kinds of patient data arrive from genomic sequencing, sensors and even from social media, insurers, and governments can get much better insight into which treatments work. These buyers are increasingly demanding “value-based” reimbursement—meaning that if a drug or device doesn’t function well, it will not be bought.”

This is great news for patients but may become a significant disruptor to the industry.

Home-Based Care is Increasingly Achievable

Last year, the FDA approved 36 internet connected health applications and devices. It won’t be long until it is commonplace for people to monitor their health conditions, diagnose concussions, assess heart conditions, diagnose ear infections, or check up on a suspicious mole all using mobile devices and sensors. Smartphones may be able to predict future conditions like Parkinson’s, Alzheimer’s, or the onset of menopause.

Market research predicts that Americans will conduct 5.4 million video consultations a year by 2020. Aside from the convenience this approach affords, it will also be a critical tool for addressing the growing physician shortage and the rapid aging of our population. The US is not alone in adopting transformative digital health technologies. One Chinese startup raised $188 million for a video-consultation app. India has seen an increase in technology that lets patients communicate with doctors and assemble all of their health records as well.

The digital healthcare train has, as they say, left the station. What’s important now is that the needs of patients and providers are carefully balanced against the cost-savings and efficiency that the technology provides. Patients are rightly concerned about the privacy and security of their now electronic health information and need assurance that new methods of care are safe and effective. But in the long term, it is patients who stand to benefit the most from technology that improves the patient experience or prevents them from becoming a patient at all.