Monday, July 19, 2021
There’s a reason the subtitle to my book with Ed Marx was “how consumerism, technology and pandemic are accelerating the future.” A study published by consulting firm McKinsey points out to broad acceptance of telehealth among consumers as a factor driving the shift to virtual care. The report declares that as much as a quarter of a trillion dollars in healthcare delivery (out of an estimated $3 trillion in annual healthcare spend) will shift to some form of virtual care.
Damo Consulting’s research and advisory work with leading firms confirm the trends reported by McKinsey. What we are seeing now that health systems are shifting to the next phase of virtual care; optimizing and scaling existing programs, reviewing technology partnerships, and investing strategically in enterprise-class platforms.
Our work indicates that large tech firms such as Salesforce and Microsoft are making steady progress in expanding their footprint, enhancing platform features, and investing in partnerships. Microsoft announced a partnership this past week with leading telehealth provider Teladoc (read my comments in Modern Healthcare on the partnership announcement). Along with acquisitions such as Nuance, Microsoft is expanding its platform capabilities to be an end-to-end solution provider for the virtual care model of the future.
Digital health startups, in the meantime, are raising vast amounts of VC money. Indications are that they are raising more than they need or know what to do with. The pressure to grow market share at all costs is going to intensify and likely lead to poor outcomes for some of them. Many startups are spending all the VC money on sales and marketing for expanding their client bases (often overselling their products and giving them away for little or no cost to clients) at the expense of product development, leaving clients with half-built products on their hands.
All of this screams “bubble.” The only bubble I can see is in the champagne that’s flowing in the digital health party that’s in full swing.
Have a great week.
Podcast of the Week
In this episode, Matthew Roman discusses how Duke Health is implementing a number of foundational technology platforms for effective patient engagement and care delivery over the next couple of years.
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This Week in Digital Health Markets
We are selectively featuring guest posts in our newsletter from senior leaders in healthcare and technology. Reach out to us if you would like to contribute a blog to one of our upcoming newsletters.
Telehealth: A quarter-trillion-dollar post-COVID-19 reality?
Comprehensive report on the state of telehealth in a post-pandemic era by McKinsey. Worth a read. Mckinsey
Startups Cash In as Venture Funding for Digital Health Rises
Entrepreneurs grab new funds to hire more staff, expand market share. The Wall Street Journal
Microsoft partners with Teladoc, expands healthcare capabilities
Enterprise-class technology firms may end up as the eventual winners in the healthcare digital transformation race. I share my thoughts on the recent Msft-Teladoc partnership in this piece. Modern Healthcare
Patient data company Truveta raises $95 million, secures new hospital partners
Truveta, helmed by former Microsoft executive Terry Myerson, has signed on D.C.-based MedStar Health and the Dallas-based health systems Baylor Scott & White and Texas Health Resources. The hospitals now participating in the company’s efforts account for about 15% of care delivered across 40 U.S. states. STAT News
How Geisinger uses telehealth to keep patients at home and out of the hospital
An executive at its Center for Telehealth explains how the Pennsylvania health system evaluates virtual care models – and when it knows it’s time for an ER visit instead. Healthcare IT News
Northwell Health uses machine learning to reduce readmissions by nearly 24%
The health system’s medical director explain show clinical AI is better than predictive analytics when it comes to improving patient outcomes. Healthcare IT News
Walgreens shares next step in primary care plans: 29 more clinics in Texas
As part of a partnership with primary care provider VillageMD, Walgreens plans to open 29 clinics in Texas this year. In total, the companies plan to open at least 600 clinics over the next four years. MedCity News
ONC says TEFCA will be live in 2022
The agency has also awarded an additional $942,000 to The Sequoia Project to support its efforts as the interoperability initiative’s recognized coordinating entity. Healthcare IT News
The ONC has released the new version of the United States Core Data for Interoperability, a set of standards to enable seamless data exchange nationwide. The updated set includes standards for exchanging data related to social determinants of health, sexual orientation and gender identity. MedCity News
Note: Some of the articles linked in this newsletter may be behind paywalls that need a subscription.
Damo Consulting Thought Leadership and Research
A booming digital health market, and an elusive trifecta
Health system CIOs are reducing their tech footprint and consolidating their IT systems for agility and efficiency. For digital health startups to succeed in this space, they must get three factors right: cost, scale and quality. Blog
The Digital Health Solution Selection Process
When health systems look for solution partners to execute their digital priorities, the decision process typically looks like this. Infographic
AI-enabled physicians: rethinking care delivery
While traditionally deeply skeptical of artificial intelligence in clinical settings, in today’s fast-changing care delivery landscape many physicians are thinking more proactively about how how AI can improve quality and patient experience. Blog