The Need for New Business Models in Healthcare

In the age of digitalization and technologies revolutionizing the way we get our information, do our jobs and live our lives in general, the capacity that we as consumers have at our fingertips is greater than ever. As you might have predicted, this orientation toward consumers is increasingly putting pressure on the business models of modern healthcare systems as we know them. In traditional healthcare plans, like the vast majority that exist around the world today, healthcare delivery systems are focused on hospitals and providers (MaRS). A healthcare plan’s role currently is more akin to that of a financier, but demographic changes are putting pressure on the way business models in healthcare were once organized, paving the way for innovation in new business models in healthcare.

With increased patient access to technology in a digital world, patients also have greater access to medical information, leading to a global demand for better health outcomes for the money that is spent on healthcare (MaRS). With increased technological fluency, healthcare business models are under greater pressure to meet patient expectations and demands. Additionally, healthcare business models are being forced to change as care is moved out of the hospital to lower-cost care centers, such as walk-in clinics. This shift is requiring more focus to be put on individual wellness, while our attention is shifting away from institutional care and toward improving consumer quality of life (MaRS). Together, these shifts have contributed to the rise of “on-demand healthcare” (Digital Authority) in which patients are demanding care which can be adapted to their own schedules.

To accommodate the changes of an increasingly mobile world, healthcare business models will have to move from their traditional roles of focusing on the management of enrollment and risk to focusing on creating a framework which supports sustaining the well-being of members in a more individualized way (Deloitte Insights). Additionally, healthcare business models will need to shift their mindset toward one that is more flexible, and more willing to take risks (Digital Authority) in order to be able to adapt and respond to consumer preferences. Based on observing the increasing pressure that technological and demographic changes are putting on healthcare business models, Deloitte Insights compiled a few predicted trends for the healthcare business models of the future.?

With an increasing movement toward individualization of healthcare, Deloitte predicts hyper personalized healthcare plans, in which consumers are able to customize their purchases. Additionally, technology will facilitate recommendations for products based on a consumer’s individual health care needs. With the increased popularity and adoption of technologies which allow us to monitor our health, such as wearables and sensors, healthcare plans will be able to use the information from these devices and link it with general consumer attitudes, buying patterns and social determinants of health in order to better understand the needs and preferences of their members. With a greater availability of data to support this understanding, healthcare plans will be able to give their consumers more personalized products and experiences, moving with the general trend toward individualization in the consumer market.?

Healthcare plans can’t deny the changes observed within the consumer market, and experts recommend their acceptance and openness toward new technologies which could help to improve their current business models. If healthcare plans resist such changes, there is no doubt of the prospect of new, nontraditional players entering the market to offer “data-driven, consumer-centric options” challenging these plans (Deloitte Insights).

MaRS Discovery District speaks to the concept of “digital health,” which refers to “the technologies and networks used by all stakeholders in the healthcare delivery ecosystem to enhance collaboration and individual wellness,” as well as reducing overall costs.

This concept speaks to the positive impact that the creative application of technology can have on the healthcare system. As with applications such as blockchain technology, there are many benefits to implementing technology which contributes to a greater database. Big data benefits include more accurate staffing in hospitals and clinics to accommodate patients more efficiently, a lower rate of medication and delivery errors and a greater understanding of the market. Together, such technology contributes to a greater capacity for healthcare business models to create a customer persona (Digital Authority).

With more access to technology in the digital era in which we live, consumers are moving towards a demand for individualized health care. Healthcare business models have the opportunity to accommodate such demands with the creative application of new technologies to gather data and create a business model catered towards the well-being of consumers. This requires a shift beyond claims processing, to a greater focus more on the well-being and care of consumers (Deloitte Insights).