AARP Examines the Connected Health Market

by Parks Associates | Sep. 16, 2014

Keith Epstein, Senior Strategic Advisor, AARP shares his insights at the Connected Health Summit: Engaging Consumers. Keith was a member of the Advisory Board and spoke on the "Healthy Living, Connected Devices, and Wearables" panel at the 2014 event.

What do you feel is the biggest obstacle to growth in digital health services?
It depends on your definition of digital health services. If you are talking about personal health records, the biggest obstacles are consumers. They don't see the need for a digital health record, don't want to key-in all the data themselves, worry about the record getting hacked, and expect that their doctor or insurer will do it for them. If we are talking about digital health devices, the biggest obstacle to uptake is lack of a payer. The B2C model has been very rough sledding. The participation of big names like Qualcomm, Verizon, Intel, and, most recently, Apple, raise the market's profile. But so far, uptake continues to be strongest among fitness enthusiasts, as opposed to the group that could really see marked health benefits for themselves or their loves ones: 50+ with chronic illnesses (which includes 80% of the 50+). Continued interoperability issues, cost, and the unwillingness of big-box retailers to feature these devices have muffled demand. The game-changer will be a large payer (probably a private health insurer or Medicare) being willing to cover these devices. Consumer say in surveys (including AARP's) that they assume insurance would cover home monitoring/diagnostic devices anyway.

What will be the biggest driver for digital health market?
Population aging and an increase in chronic illnesses will no doubt be major drivers of the digital device marketplace as well as for demand and use of PHRs. If what you are looking for are disrupters that would cause those markets to take off, I'd say:

  • A payer being willing to step forward. Decision-makers at the private health plans used to argue there wasn't enough evidence of efficacy. But the evidence base has grown substantially, particularly around certain interventions. At a time when they are trying to appeal to consumers, could this be a great differentiator?
  • The emergence of ACOs, as real entities rather than conceptual, unicorn-like imaginings of policy people.
  • Buy-in from docs. Docs continue to be the most trusted voice in healthcare. If they start pushing devices and PHRs, patients will come along.
  • Improved interoperability and ease-of-use. So many of these solutions are stand-alone. They need to be integrated, as our chief medical officer. Charlotte Yeh says, into the "workflow of people's lives." Maybe it's through the TV or the tablet (think: Grand Care) or a wrist watch. Whatever it is, it can't be just another box that blinks 12:00 at me when the power flickers off. It also has to be able to share data seamlessly and be plug-and-play.
  • Visibility. When health devices begin showing up at Wal-Mart, the wind will have shifted.
     

Name the most important player in your industry—the one that will have the largest impact on advancing digital health services for consumers
I think the emergence of big and unexpected names to the digital health space—you know the names—add credibility, visibility, and investment. Who ever thought GE would play in health? Qualcomm? AT&T? They are placing big bets and that's good for the industry and for consumers.

What features should health and technology providers focus on to convince consumers to sign up for new services or engage them to change health behaviors/adopt preventive care services?
Think outcomes, not apps. What I mean is, tech developers tend to love to add new applications to devices because their soft, not-yet-fully-formed brains think more is better. Consumers in this space want quality, not quantity. Developers should be thinking about how to improve outcomes such as "peace of mind," "ease of use," "dependability," "security." Oh, and improving actual health outcomes would be great, too! For the target audience, less can be more if the device does a few meaningful things very well. So, an example: if a son or daughter can have 100% confidence that X device/app will alert them if something happens to their mom who lives across the country, give them a clear line of sight about what to do next, alert local emergency people if necessary, make the device private and super easy to install, and I think it would be a winner.

What is one key issue around digital health services that people can’t stop talking about?
Wearables are the hot topic, of course. Also, entry of key big name players such as Apple and the latest M/A developments.

What is the best model for care collaboration between the technology industry and the healthcare industry to advance the triple aim (cost, access, quality)?
Targeted, timely, and tailored interventions for people with multiple chronic diseases. If we're really talking Triple Aim, tech companies should work with hospitals to identify the highest-cost patients and outfit them with monitoring technology that could serve as an early warning system. Of course, these folks would be sent home with more than just a box. The technology would be a component of a much broader care collaboration that would include transportation, meals, personal care, regular human contact, and active condition monitoring by the medical team.

How ready do you think health industry players are for the dynamic changes (new consumer technologies, better pricing transparency, better access to health records) that will empower consumers to take greater ownership of their own care?
Not ready but moving in the right direction. Lots of "industry" players here:

The impulse among tech developers is still to develop gadgets with ever-more features. They need to spend some more time with the end users and understand what their needs (and their limitations) are.

Insurers have some pretty good PHRs available and some cool health apps and information. They would give a boost to the health device market if they actually agreed to pay for these things. Heck, they don't have all the evidence they'd like that acupuncture works, yet increasingly they are covering it… Docs continue to carry the Luddite Banner. They don't trust technology and don't like patients generating data on their own. This will change, but it's a generational issue. While tablets have taken off in hospitals, docs are far from being ready to receive an information flow from an in-home device and diagnose something. One problem: they aren't paid for it. Telemedicine? Fine, at least in rural areas because Medicare reimburses. Analyzing blood pressure data from remote monitoring devices? Fugetaboutit!

Consumers don't know about a lot of this stuff. It remains pretty darn expensive, except for the fitness devices. They are worried about privacy and data breaches. They think insurance should pay. I think there is pent-up demand among caregivers for the right solution. That's the addressable market for me if I'm developing a technology.

The government has actually done a lot. FDA could have obliterated the entire mHealth market in a single day had it said new devices and apps would have to be regulated as "medical devices." It didn't do that and that was a good thing. The administration, through the Office of the National Coordinator, has done a lot to bring Medicare PHRs right up the edge of acceptability through Blue Button. They are fighting the good fight but have lots of obstacles (see above). A game changer, as I said, would be for Medicare to start covering some of these devices. But in a climate where Congress and the White House want short-term savings out of Medicare, I don't think saying that devices/apps will save us a boat load of money in the long run will fly.

These thoughts are mine only, based on my analysis of the space, and offered to guide thinking -- but nothing I'm saying represents the view of my organization, which represents 37 million people 50 years of age and older. 


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