Will “digital” remake health care like it has book selling, travel, food delivery, and transportation? It should, but the health and human service field is not exactly like other areas of commerce.
What are the issues? What makes “digital transformation” less likely (or at least slower and less sweeping) in health and human services? I think there are two factors—the leadership of many of the digital start-ups and the lack of digital dexterity of health and human service organizations. Together, these two factors create quite a chasm between early adopters and the majority (see Is 2019 The Year Of The Telehealth Tipping Point?).
Currently, many digital health ventures fail. Or at least, that is the message in Why Do Digital Health Startups Keep Failing?, in Fast Company. Their take: new digital offerings for health care are being designed by entrepreneurs and investors that understand technology but not the health care landscape. “Complicated” is an understatement when it comes to health and human services—the impact of consumers, caregivers, professionals, provider organizations, payers and health plans, regulators, and legislators at both the state and federal levels need to be considered. “Need-driven innovation” combining knowledge of technology with deep knowledge of specific sectors of the health and human service landscape is the winning (and rare) combination.
Then there is the organizational landscape in health and human services. Even for the best of digital innovations, it is often like—to quote the parable—sowing seeds on rocky ground. Health and human service organizations lack good performance data to prioritize technology investments (see Tech Capabilities In An Era Of Integration & Value). And, even with the data, many organizations lack the digital dexterity to make digital yield results (see Digital Transformations Demand Digital Dexterity).
This situation is not unique to health and human services. Across all industries 62% of organizations have failed to lay a strong foundation for IT transformation, and 44% have not taken any action to support IT transformation (see The Challenge Of Change: IT In Transition). Additionally, 51% of organizations report stalling or abandoning some IT transformations. One of the key challenges reported from these organizations was that they had the wrong tech, but there were several other problems cited by managers in the survey—including the problem of having multiple legacy systems (64% of organizations reported), data security (60%), tech silos (59%), tech budgets (54%), and competing priorities (53%).
A recent study examining the digital maturity of six industries found that health care field ranked third in terms of overall digital maturity—typically lagging about a decade behind other industries in adopting business technologies that would help with customer engagement (see Study: Healthcare Lags Other Industries In Digital Transformation, Customer Engagement Tech and The Digital Transformation Race Has Begun). Health care ranked second in data optimization but struggled in self-service, digital marketing, and preparedness for disruptive business models (ranking last).
I don’t think we’ll see an end to investment in digital platforms for the health and human service field. Digital health funding is on pace to reach $6.9 billion by the end of 2018—up from 2017’s $5.6 billion in total investments (see Digital Health Investments on Track to Surpass 2017). In 2018, there were a “record-breaking” 54 acquisitions and mergers in the digital health space (see 55 Digital Health Mergers And Acquisitions In 2018). The digital health market is predicted to grow to $379 billion by 2024 according to a recent Global Market Insights report, and the third quarter of 2018 was the largest funding quarter for digital health ever recorded (see With $4.5B, Q3 2018 Was Digital Health Funding’s Biggest Quarter Yet). Still not convinced on the growth? Here is a look at some of our 2018 coverage, including:
- Personal Assistance Services Integrates wayForward’s Behavioral Health Counseling, Engagement, & Analytics Digital Platform
- Freeletics Closes $45 Million Series A Funding
- Tabula Rasa HealthCare To Acquire DoseMe, A Precision Dosing Software Company
- Propeller Health Acquired By ResMed For $225 Million
- Virta Health Launches An At-Risk Diabetes Management Model
- Tabula Rasa Acquires Health Care Tech Company Cognify
- G. Growth Partners Completes Acquisition Of Eruptr
- In-Home Medication Manager Platform Hero Launches To Consumers With $12 Million Backing
- AMA Unveils Digital Health Implementation Playbook
- StartUp Health Raises $31 Million From Novartis, Ping An Group, Chiesi Group, GuideWell, & Otsuka
In 2019, we’re likely to see these investments continue. Some of that investment will be fueled by developing solutions for “big players” in field including big tech firms (see Google Parent Alphabet Invests $375 Million In Oscar Health and Amazon To Launch ‘Choice’ Brand Of Consumer Medical Devices Created By Arcadia Group); the big health plans (see UnitedHealth Plans To Launch Electronic Health Record In 2019. and CVS Health & Rimidi Launch Diabetes Pilot Project In Atlanta); the big health systems (see VA Rolls Out APIs To Improve Interoperability, EHR Data Access and Sweetch Partners With WellSpan On Diabetes App); and further investment in health tech by pharmaceutical companies (see Otsuka & Proteus Expand Digital Medicine Partnership In 5-Year, $88 Million Collaboration Agreement and Novartis To Launch Innovation Labs Across The Globe, Including Silicon Valley).
For more on technology investments and digital dexterity, don’t miss these resources in The OPEN MINDS Industry Library:
- Digital Transformations Demand Digital Dexterity
- Your Digital Tech Integration Checklist
- ‘Productizing’ Services For Competitive Success
- Thinking About Partnering With A Tech Start-Up?
- Failure To Launch
- Moving Out Of Your Comfort Zone: The VBR Technology Continuum
- Are You Strategically Interoperable?
- Using Virtual Care To Improve Your Value Proposition: Best Practices In Integrating Technology Into Your Community-Based Program
- Anticipating The Strategic Impact Of Virtual Health
- Are Your IT Systems Ready For Value-Based Reimbursement? Take The Quiz
And for even more, join OPEN MINDS Senior Associate Joseph P. Naughton-Travers, Ed.M. for his Executive Seminar, Making The Right Tech Investments For Your Organization: An Executive Seminar On Technology Budgeting & Planning, on February 13 in Clearwater, Florida (for a preview of the seminar, see How To Make The Right Tech Investments For Your Organization: An OPEN MINDS Executive Seminar On Technology Budgeting & Planning).