The U.S. healthcare market is ripe for technical disruption. Costs are spiraling out of control while quality of service and customer satisfaction continue to go down. The system is opaque, complex and fragmented. Regulation is required but imposes heavy costs. As in other industries before it, the healthcare sector can benefit from technology-enabled efficiency gains that use measurement tools, structured data, analytics, SaaS, faster processing, smartphones and tablets.
At this stage the overall sector, which includes mobile health, electronic medical records (EMR), and Web-enabled health and data analytics, is nascent. I find that entrepreneurs and investors are still apt to openly discuss market trends, business models and partnerships.
I recently organized a dinner for venture capitalists who invest in the digital health sector. The objective was to discuss companies, markets and business models and see how we might collaborate. The guest list was a who’s who of investors in the sector. We had several great conversations but more often came back to the topic of what markets, technologies, and areas are most attractive for investment in digital health. In no particular order, and augmented by conversations I’ve had outside the dinner, here are some of the areas we think are interesting.
Products enabling price transparency: The basic problem here is that a medical test or procedure may be priced dramatically differently in two different clinics situated in the same ZIP code. The consumer, however, rarely has any visibility into these charges until after they receive their bill and they have no idea that they could have had the same procedure done elsewhere at a much lower cost to them. Payers and patients have no mechanism to easily compare procedure costs—but companies like Castlight and Clearcost are trying to create more transparent pricing.
Services for aging population: It is well known that Americans are getting older and suffer more from chronic disease. Although direct care and services for the elderly will consume a significant amount of the money spent in this sector, venture capitalists are keen to find ways to efficiently manage and organize this care. Companies like Proteus Digital Health target compliance and mobile tracking. Care at Hand has a mobile application for home health aides.
Data, data, data (part 1): If patient record data is digitized, and that’s still a big if, it is often stored in disparate locations in different formats, which means it’s hard to use. Much has been written about aggregating, comparing, and analyzing individual medical record data to improve outcomes and help diagnosis become predictive. Although the standards are in place, there is still a long way to go. Practice Fusion is going after storage of EMR while drchrono is helping patients easily access their records and data. Humedica is ahead of the game in analyzing data and using it for very practical purposes.
Data, data, data (part 2): There is a new wave of data generated by users. This comes from mobile phone applications that track movement, mood, or calories consumed; new wearable sensors like Fitbit, Nike Fuel, and larklife; and wirelessly connected scales or blood pressure monitors from Withings. This new type of data, when aggregated and combined with existing EMR, has the potential to help people improve health and well-being. Right now much of this user-generated data is fragmented with few standards, but many companies are opening up their APIs and there are companies attempting to aggregate and connect this data to sources that can do something with it. Genomera is trying to use this data for studies and for pharmaceutical companies, but a bigger play would seem to be exposing this data to payers.
The rest of the article can be found at xconomy.