Digital Health

U.S. Healthcare: From Disease Management to Population Health

by Harry Wang | May. 10, 2016

The disease management (DM) industry, which focuses on reducing or delaying the use of expensive treatments or costly procedures, has passed its prime time as a unique approach to controlling escalating costs attributed to chronic conditions. It worked on the “sickest of the sick.” But as patient conditions progressed and engagement levels decreased, it gradually lost its effectiveness. The industry hit a growth ceiling when health clients no longer found that cost savings justified the high care management fees charged by DM firms, especially when applying a DM approach to patients with less severe chronic conditions.

Since 2008, DM approaches have been modified by health clients, especially insurers and integrated health systems, and have proven more cost effective. However, the entire health care industry has recognized that prevention should occur much earlier in a patient’s care continuum. Detecting early signs of problems and engaging consumers with preventive care services, proactive education, and effective self-care is the current thinking. This approach shows greater promise to fundamentally address the cost problems inflicted on the health insurance industry as well as the quality-of-life impact on patients themselves.

This recognition has triggered a new round of experiments in tackling the chronic condition epidemic in the U.S. Other terms that describe similar approaches exist, but healthcare industry constituents increasingly use the term “population health management” to refer to a set of practices that focus on early management of and engagement with consumers with moderate to severe chronic condition risks. The word “population” connotes that this approach will manage a large swath of consumers with heterogeneous chronic risk profiles and demographic/socio-economic backgrounds. The challenges of doing “population health” right include:

  • Motivating consumers who many not realize they are at risk
  • Building a new culture and incorporating incentives for primary care doctors to help engage consumers
  • Giving consumers the right tools and information to take on self-care
  • Personalizing the experience to keep consumers engaged

As self-care tools, wearables are particularly well-suited solutions to help consumers manage their own care and provide a personalized experience. They also assist care professionals and population health management firms by feeding data into a larger personal health information pool, the use of which can improve program effectiveness and contribute to timely clinical decision support.

Fortunately, there are tailwinds behind the U.S. healthcare industry that encourage broader adoption of population health management programs. They include the following:

  • The Affordable Care Act, passed in the spring of 2010, has been in full swing since late 2012.
  • New care models, such as Accountable Care Organizations (ACO), Patient-Centered Medical Home (PCMH), and other coordinated care models, have accelerated care model transformation.
  • Health information technology adoption rose rapidly.

Some headwinds in the healthcare industry can offset these tailwinds. For one, the Affordable Care Act (dubbed Obamacare) faces significant political opposition from the Republican Party, which controls both the Senate and the House. The Affordable Care Act survived the latest challenge in the King vs. Burwell case, when on June 25, 2015, SCOTUS ruled 6-3 to uphold the legality of federal subsidies to people who buy health insurance on a federally run health insurance exchange in 34 states, but the outcome of the next presidential election could disrupt the continual implementation of the ACA or even scrub Obamacare completely. Parks Associates believes that new health reforms from the GOP would incorporate many elements of Obamacare, but the political mess could delay implementation of new care models and disrupt the pace of technology adoption, including that for wearables, by population health management programs.

In practice today, many population health management organizations—along with their clients in the health insurance, hospital, and integrated health system businesses—have shown a strong interest in using wearable devices for health vital sign data collection. This interest has spurred a race between technology providers from the consumer market and traditional health IT vendors.

Health IT vendors, including top players such as Epic Systems, Cerner, McKesson, Allscripts, and major contenders such as AthenaHealth, are eying IT tools for population health management as the next big growth opportunity. These tools, which target physicians and nurses as adopters who manage patient populations, include modules that either aggregate vital signs from devices used by patients in a prescribed home health monitoring program or feature device interfaces that directly connect devices to clinical databases through a patient portal application.

Most vendors claim that their device integration interfaces and backend technologies can support whatever devices a consumer uses. In practice, however, their software and databases are only likely to connect to a small number of wearable health tracking devices. This is because their solutions’ use cases are centered on doctor-prescribed devices that have the permission to interface with the EMR. This limitation is the Achilles’ heel of these health IT vendors; wearable device makers may find it a resource drain to work with a myriad of proprietary EMR systems designed by these vendors. It is possible that device integration can take place at the cloud level—that is, a wearable device maker’s own cloud interacts with an EMR vendor’s cloud, but traditional EMR vendors’ cloud infrastructure is relatively weak, and their reputation on cloud API integration is poor.

Another group consists of a diverse range of technology vendors that share the same attribute of not being a traditional health IT vendor. Many used to be health monitoring hardware vendors but shifted focus to software and integration services (e.g., Intel-GE Care Innovations, AMC Health, Ideal Life, Numera). There are also many startup companies that are building their solutions with the latest cloud infrastructure and data integration technology. Notable players include WellTok, Virtual Health, WellFrame, and Vivify Health. Some may even have their own population health management service built on top of their respective technology platform—examples include Wellness & Prevention from Johnson & Johnson, Conversa Health, and Redbrick Health. Lastly, there are pure data aggregation and integration platforms that serve clients in the population health management industry—examples include Microsoft’s HealthVault, Qualcomm’s 2Net, Validic, and the HealthKit from Apple. The last group of providers can serve the other three categories of vendors within this group.

For pure-play wearable device makers, these vendors—both EMR vendors and others—are all potential partners that can help them find ways to distribute wearable health devices to end users through a population health management program. But as our analysis suggests, the population health technology market today is very fragmented with no clear leaders. This makes finding the right partnerships difficult. Wearable device makers have a large opportunity and need to identify partners with solid business relationships with population health service providers, work with vendors offering future-proof technologies and long term growth goals, and influence consumers through marketing, which will indirectly influence health clients hiring population health service providers.

This article originally appeared on E-Commerce Times.

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Harry Wang

Harry Wang

Senior Director of Research

Harry Wang oversees Parks Associates’ mobility and apps research, which covers mobile/wearable devices and services, apps and APIs, and mobile commerce/marketing, payment, and connected car industries. He is also the founder and lead analyst of Parks Associates’ digital health research program since its inception in 2006. He and his team cover emerging health technologies, applications, and services in areas such as chronic/preventive care, independent living, wellness and fitness, and virtual/convenience care.

Harry has published more than 40 industry reports and white papers and presented his mobility and digital health research at numerous industry events including CES, Mobile World Congress, CTIA, Open Mobile Summit, World Health Congress, the American Telemedicine Association Annual Trade Show, and Parks Associates’ CONNECTIONS™ and Connected Health Summit conferences.

Harry earned his MS degree in marketing research from the University of Texas at Arlington. He also holds an MBA degree in finance from Texas Christian University and a BA degree in international business from Guangdong University of Foreign Studies, P.R. China.

Industry Expertise: Digital Health Products and Services, Portable and Mobile Access Platforms and Applications, Digital Imaging Products and Services

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