The Future of Health Insurance: Preparing for Dr. Big Brother

While futuristic technologies are becoming available in healthcare, patients often can’t access them and the cost of providing care continues to skyrocket. However, innovations such as artificial intelligence (AI) and health sensors are set to reshape how healthcare insurance works and by doing so bring much needed reforms to healthcare as a whole.

Current health insurance systems are simply not sustainable

According to OECD predictions, exceeding budgets on health spending remains an issue for OECD countries. Maintaining today’s healthcare systems and funding future medical advances will be difficult without major reforms. Public expenditure on health and long-term care in OECD countries is set to increase from around 6% of Gross Domestic Product (GDP) today to almost 9% of GDP in 2030 and to 14% by 2060. This will be the harsh reality unless governments and private companies change the structure of how healthcare is funded.

In countries with private health insurance, certain treatments such as cancer care are so expensive that only the privileged with good insurance plans can afford them. In countries with socialized medicine, where everyone has access to basic care, new innovations are hard to roll out nation-wide as the system as a whole cannot afford it.

 “A key part of health care reform involves the use of technology to address a number of issues such as access, value, and cost,” - Bill Frist, former US Senator and heart-lung transplant surgeon.

While we generate mountains of data providing healthcare on a daily basis, the majority of it have nothing to do with lifestyle choices. Measuring blood pressure or taking a pulse may be routine practice, but the system doesn’t know whether patients are looking after themselves outside of the healthcare system. It is impossible to improve a system without measuring all key parameters in it. Today’s healthcare lacks this.

From risky business to providing better care

A key factor is that people are not motivated to stay healthy. They don’t get reduced health insurance premiums if they do, and the system is focused on treating diseases, instead of educating patients on taking care of themselves. Moreover, even when the obvious negative consequences of lifestyle choices (from smoking to obesity) are proven, it’s hard to persuade patients to stay motivated and maintain healthy choices.

Health insurance is one of the most risky businesses nowadays. No matter what details companies need about insured patients, they cannot get enough information to make fully informed investments in a person’s future health. Companies can obtain information on a patient’s gender, age and some basic details about lifestyle, but as they cannot measure any health parameters, the value of the investment remains questionable.

Many say that no-one is motivated to change this, but that’s not true – health insurers and governments have ample motivation. Insurance companies lose out because they cannot gauge your well-being based on the rudimentary data they have on you, and governments lose because their healthcare bills keep climbing as long as you’re not taking care of yourself. New technologies might offer a new chance.

Disruptive medical innovations will change the landscape

New technologies such as wearable and implanted sensors and algorithms using artificial intelligence will change this status quo and insurance companies will certainly try to implement these into practice. Oscar Health has already done that in the US. Their patients get Amazon gift cards as rewards for achieving their daily goals as measured by a FitBit activity tracker. But much more can be done. Today, patients can measure sleep quality, physical activity, stress and blood pressure, among many other parameters at home, Health insurance companies are still struggling with how to capitalize on this. 

Around a hundred million wearable units to measure health parameters were sold in 2015. It is predicted that 245 million wearable devices will be sold in 2019. And this is just the beginning. Digital tattoos can measure data and notify the user when medical supervision is needed without the user’s active participation. When AI-based algorithms start to browse patients’ health data, they will discover new correlations and long-term consequences. Insurance companies will use these data to make premiums higher for high-risk patients or to reduce their business risks by alerting patients about bad lifestyle choices.

As these amazing data sets about our lifestyle become available it is inevitable  insurance companies will try to obtain them. This raises many questions about the privacy of patient information. But at some point, it is going to be inevitable if you don’t want to pay for the health insurance of those who never take care of their health.

A new health insurance or the rise of Dr. Big Brother

In a dystopian scenario, companies will only provide patients with insurance if they are allowed to access all of the patient’s data, including data coming from sleep and fitness trackers, the blood pressure and ECG they store and gadgets they use to assess their general well-being. Based on this, companies will be able to either change patients’ premiums or notify them about changing it soon based on lifestyle choices. Choosing a big steak instead of something more suitable for your customized diet or being too lazy to exercise will mean higher premiums. Whatever you do and whatever decision you make, it will have an impact on health insurance.

Insurance systems might discriminate against patients if they have medical conditions that are determined to be predominantly genetic and not lifestyle-related. Companies could require employees to provide genetic test results. The US law, Genetic Information Nondiscrimination Act, was meant to fight against such biases, but what if new insurance policies change it?

Let’s take a more realistic and optimistic  perspective. As insurance companies can access the data coming from patients’ devices, they can offer more personalized therapies and plans. They can reward those people who live a truly healthy life, although people who choose to keep on smoking and not doing exercises supported by an unhealthy diet, would have to pay more to contribute equally to healthcare costs. This way, living an unhealthy life remains a personal right, but it would also become a luxury to balance out the huge costs they add to the healthcare system.

Proteus Health, for example, analyses individual patients' health habits via a patch worn by the patient. This sensor streams data to the patient’s and also their caregiver’s smartphones and helps them better manage the condition. Health data is collected but in a way that benefits the patient.

What is required for this positive approach is more systematic measurement of relevant data associated with lifestyle choices, as well as apps and devices that help people live healthier lives.

Regulators must also ensure insurance companies don’t get uncomfortably close to our data about our personal health choices. In 2015, the FDA released a new guidance on digital health products including mobile health applications, but we need more detailed guides about what companies can and cannot do.

Rewarding healthy decisions is much different from punishing bad ones. The biggest challenge today is that the regulators are not at the forefront of innovation and they cannot hope to anticipate and regulate changes that they don’t yet understand. Most patients on the other hand, are either not aware of emerging technologies or don’t understand their impact on the patient’s privacy.

Total privacy or equal healthcare?

Today’s healthcare is financially unsustainable; patients don’t have access to the latest innovations and doctors are struggling to provide decent care with the equipment they have. We must upgrade health insurance systems to motivate each of us to live better by making use of emerging technologies. As more and more people turn to wearable sensors to help them live healthier lives, this is starting to happen.

But we need to avoid the creation of a Dr. Big Brother who watches us, has access to every detail of our lives and thus impacts our personal decisions. We must at all costs avoid a scenario where someone would control what we eat, when we exercise and when we lay down to sleep. Such level of control is against human nature. But so is paying for something collectively and getting no improvement out of it. When people keep up their bad lifestyle habits after getting a diagnosis, those living a healthy life will not want to finance the system anymore.

This means some oversight by governments and insurance companies probably will arise shortly. At the end of the day, if I need to share my fitness tracker’s data with my health insurance company in order to enjoy the rewards of living a healthy life and to have an equally compensated healthcare system, I’m happy to do that. The essence of this system would be a healthy balance. Companies do not need to know every tiny detail about me to know I’m living a healthier than average lifestyle, so I don’t have to share everything in order to benefit from a reformed health insurance system.

Technology will soon offer the opportunity for truly personalized care, tailored to our genetic background and lifestyle. The future of health insurance would guarantee we each have access to it, while at the same time keeping Dr. Big Brother away from the privacy of our personal lives.