The Consumer Electronics Show(CES 2014) kicks off today and includes an entire track dedicated to Digital Health. In fact, this year’s event will dedicate its largest footprint ever to health and wellness. Industry expert John Korry recently categorized emerging medical technologies at CES 2014 as follows:
Yet, many of these “new” technology solutions have been available for a number of years. I’ve been on the digital health bandwagon since the turn of the century when I first learned about a Veteran’s Administration pilot using what is now the Bosch Healthcare Telehealth Solutions device to coordinate the care of veterans living with chronic disease. Fast forward twelve years, and the partnership has grown to provide care coordination and telehealth services to over 60,000 veterans. Why is this type of technology not more commonplace?
Follow the money. And mobile devices.
The reality is that these technologies have failed to penetrate the market due to lack of reimbursement – both for the start-up investment costs to purchase the devices and for ongoing clinical support.
As an example, I looked into purchasing the Philips Personal Medication Dispenser for my mother who is on Medicare. The machine distributes the exact dose she needs at the exact time she needs it, but costs more than $800 and was not covered by insurance. Additionally, I would need to pay out of pocket for a home health aide to help her fill the machine as she cannot not operate it on her own, adding an additional hefty expense. The machine and service is certainly cheaper than assisted living rent (which would be the next step if she can’t manage her own medications), but it’s still a hard pill to swallow (pun intended) for those who are forced to pay out of pocket.
It’s also cheaper than hospitalization, which might result if she does not take her medication as directed. Thirty to 50 percent of patients don’t adhere to their medication regimens, leading to approximately $100 billion in preventable costs annually (the costs for those hospital stays that insurers do cover could buy 125 million personal medication dispensers, for those of you playing at home).
In the end, I didn’t purchase the personal medication dispenser, but I did opt for a holiday gift of Philips’ Lifeline with AutoAlert. It is still a heavy investment of more than $500 annually, but it is worth the 24-7-365 monitoring service that helps my mother remain at home and gives us the peace of mind that help is always available. Plus, there was no start-up cost and we can pay monthly for the service.
Despite the fact that most of these new solutions are not covered by the largest public insurers in the U.S., digital health services and apps are gaining popularity because of people like me—those of us who are paying out-of-pocket to improve their health and wellness—and by private payers and other accountable-care payment models that are willing to pilot and evaluate new technologies. (PwC’s video and mHealth commissioned reports provide more detailed information about the trends).
Where does that leave the digital health technologies in terms of access to the biggest sectors of the insured: Medicare, Medicaid and subsidized individual coverage? Government pilots like the Medicare Health Support Program did not meet cost-saving expectations—the start-up and program costs were just too high. But now that almost every American is already paying out-of-pocket for their smart phone, which can serve as a highly interactive digital health device, has one of the biggest barriers to digital health adoption—the up-front technology investment—evaporated? Smart phones may not solve every problem, but they do hold promise to break through the reimbursement barrier.
What can digital health companies do to hasten adoption?
For digital health to truly penetrate, companies need to work together to:
- market to the end-customer who has growing influence and is choosing more often to use their discretionary income on health-related medical technology;
- develop a sound strategy for unlocking the private and public insurance systems to support reimbursement for the accompanying clinical services; and
- educate clinical partners about solutions that improve patient care and provide revenue streams.
The strategies themselves may seem simple yet are terribly difficult to implement. However, a company’s leadership usually can control 99 percent of the difficulty by demanding alignment and coordination among diverse teams such as regulatory affairs, clinical research, managed markets, marketing and communications. Communicators can take the lead in helping facilitate this internal alignment. Here are three specific ways to accomplish these strategies:
- Make the economic case: Traditionally, health care innovation is driven by the need to provide clinical studies designed only to prove efficacy and safety. However, the “holy grail” should be clinical studies that show efficacy AND impact on cost. Cost-savings is ideal but cost neutral and cost-containment may also do the trick in our current health care environment. Some companies choose to do economic modeling, but of real value is a study designed specifically to consider cost implications. Both the clinical and economic case should be planned for when considering medical technology or medical intervention. There will continue to be pilot projects that result in lackluster outcomes, but those who understand the current system of health care know this more about the broken systems in which pilots are tested, rather than the technology itself. The role of the communicator is to put the results in the proper context.
- Feed patient demand: Even in the face of what some call a “government takeover of health care” we still see a dramatic rise in active consumerism that can help fuel innovation in and the adoption of digital health technologies. Patient voices can help in reimbursement discussions but also influence patient satisfaction scores which are becoming more important when choosing a provider, a hospital or an insurance company. Access to mobile health technologies and the patient’s experience could influence a consumer rating for the provider and service and become a significant differentiator in marketing efforts. Patient demand will certainly grow if companies collect and share engaging patient stories through every available traditional and social media channel. Of course consumers want the same technologies used in finance, travel, energy and almost every other industry to be used in health care. Consumers are sharing opinions online, voting with downloads and backing it up with their checkbooks. And, in a free-market society, consumers usually win.
- Work with medical and consumer groups: The power of third-party advocates cannot be overstated. Sustaining good relationships with these groups over time has enormous benefit. A few examples:
- Anything said by a third party about a service or product is at least 10 times more valuable than if said by a company representative. This goes for product review boards and regulatory bodies as well.
- Advocates help shape the opinion of policymakers and other influencers, and their opinions are sought by the media. They give speeches in front of large crowds—usually to people that include your target audience. You want them to proactively bring your product up as a positive example.
- If you have good relationships with key third parties, they can serve as allies on media stories and regulatory issues.
- Frequent discussions with third parties can broaden your strategic understanding of stakeholder needs, and help you spot trends and foresee potential problems.
Let’s get to work.
It’s 2014 and it’s time for a fresh start. We’re going to see a lot of innovative, promising health technologies this week at CES, and communications professionals can help get them to market successfully. Gather the right people together in your company and answer the following three questions:
- What are we doing to make the economic case about the value of our solution?
- What are we doing to find and promote our patient stories?
- What are we doing to cultivate relationships with clinical and consumer advocacy groups?
We’d love to hear what you come up with. Share your comments here or @hcpolicymatters.