3 reasons consumer health apps are on the rise (no, for real this time)

October 19, 2016
Niko Skievaski President & Co-Founder

Patient engagement.

Some would say it’s a myth. Attempts to increase patient involvement in managing their health have been hurled from every angle, but it seems that until they are faced with a life-threatening illness, chronic diseases, or a broken bone, patients just can’t be bothered to truly and proactively care about their health.
The way our current healthcare industry functions, patient engagement is often reactionary and borne out of necessity. This is why there is a whole industry built around developing population health strategies that identify at-risk patients who are assigned health coordinators to be engaged for them. As it stands today, the healthcare industry seems to have taken preventative care into their own hands, leaving little room for the sovereign and informed patient to be involved.

But at the margin, there are three maturing trends that will give patient engagement the opportunity to be fully realized, and it will be through a seemingly tired medium: Mobile. Just as podcasts rose and fell before emerging as the game-changing media outlet it has become, consumer facing healthcare apps will inevitably rise again. Here’s why.

#1 My mom is more active on Facebook than I am.

The retiring Baby Boomer population makes horror stories out of the current healthcare financial models, and they make up a large chunk of the population who are approaching the ripe age when individual healthcare spending rises exponentially. But the good news is that they’ve figured out modern app heuristics—they know how to use their iPhones and have taken to them just about as well as any younger generation. Because of that, they’re increasingly engaged in social media and are becoming more and more comfortable adopting applications that help solve their day-to-day problems at their fingertips. Their increased mobile capabilities open them up as a market that is just waiting to be tapped.

#2 Electronic Health Records have been adopted.

Regardless of how much docs seem to hate EHRs, they’re no chance of the industry going back to paper. The widespread adoption of EHRs represents the digitization of clinical healthcare data. The industry is working through application interoperability as we speak, and it’s becoming increasingly easier, faster, and more economical to share EHR data with outside systems and mobile apps. This demand for interoperability causes incremental progress with the specific needs of applications as they enter the market. Meanwhile, the supply side of interoperability is breeding cross-vendor governance committees (like CommonWell and Sequoia), standards (like FHIR and SMART), and regulations (like MACRA and MU3). A collaboration of these efforts will meet in the middle in the coming years and significantly move the needle in interoperability.

#3 Docs no longer get paid for what they do.

Insiders call this the shift to value-based care. The problem started when the triad of providers, hospitals, and payers were at fundamental odds due misaligned incentives: providers got paid for procedures and tests, so naturally they ordered more; hospitals got paid the longer you stayed, so they would naturally keep you longer; insurers were on the hook to pick up the bill, so they raised premiums, declined coverage, and kicked out those with pre-existing conditions. The profit maximizing state for each entity was terrible for the patients in the middle. Led by Medicare payment reform through bundles and other regulatory changes and incentives, the industry is now being pushed to figure out how to pay doctors and hospitals for keeping their patients healthy, rather than for the services they provide in treating illness. This aligns the incentives of the provider, hospital, and insurance company with what patients intuitively want: to stay healthy and not actually use our healthcare system. This also provides the financial rationale for health systems to encourage patient engagement while simultaneously leveraging their recently stable EHR systems.

New healthcare applications are being created and sold to health systems to meet the needs of this transition. Some health systems and insurers are identifying opportunities to create their own apps, while some developers are bringing them directly to consumers through app stores with modern business models. Apple is taking steps to get ahead of the trend by releasing platforms like HealthKit and CareKit. Winners will passively collect data while engaging patient populations earlier and earlier, approaching prevention. Patients have their phones and fingers primed, waiting to make something of all of this clinical data. And as providers, payers, and hospitals begin working together around aligned incentives, maybe my mom will start trading likes with her healthcare team instead of my high school friends.

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