A Seismic Shift

I've been having a debate with myself for a while now. I can understand the excitement about AI and know that dollars/Euros will be thrown at companies operating in this space but will it have a significant impact on healthcare in the short to medium term?

AI is a truly transformational technology but nevertheless, it's a technology and technology in a healthcare context isn't transformational. Digital health isn't a field short of technology and the reasons digital health struggles to scale has little to do with technology... hence my pondering.

So I'm sure that AI will transform other sectors rapidly (and quickly make hospital admin more efficient - great but not revolutionary from my perspective) but I'm not sure will it significantly accelerate change in healthcare in the near future.

Hmm...

So why is healthcare so resistant to change? I was stuck by a recent conversation (during a prep call for our DHV Leaders event series) with Drew Schiller who leads the US company Validic. I'll paraphrase his important point:

• "We certainly wouldn't have designed healthcare systems in this way; they're so complex no one can follow the money."

Our healthcare systems across the globe were originally conceived to address challenges of their time (battle field injuries, farming accidents, bacterial infections etc). Over the years they have changed gradually, increasing their complexity as technology moves on, clinical practice evolves and reimbursement becomes more complicated. We now need them to change quickly to address the challenges resulting from modern living (chronic disease, an ageing population and a shortage of healthcare workers) but because they are complex, it's now extremely difficult to effect change at a time when we need them to change most.. and quickly. I suspect even those who manage our healthcare systems struggle to understand the intricacies of healthcare payment... it's easier to keep doing things the way we've always done them.

So let's step right back...

• Our healthcare systems across the globe change but they change slowly.
• Apart from a black swan event such as the pandemic, technology doesn't accelerate the pace of change, nor government policy, nor public opinion, the list goes on...
• But collectively we have tried! Many determined and well intentioned people have tried and these efforts are required to effect change, but the pace of change doesn't really alter much no matter how hard you push!

...but we require a seismic shift to tackle the ever increasing challenges in healthcare and the shift has already begun.

I use the term "seismic shift" with some thought to describe what is happening in healthcare. It is not the meteoric rise of that long known technology, artificial intelligence but a slow and seemingly unstoppable change in the healthcare landscape that has gone unnoticed by many. Its potential ramifications are game changing and it will be highly influential on strategists operating in the digital health space, particularly for those operating in large companies but also within government. It will affect us all.

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Harnessing The Power Of Digital Health

We have barely begun to realise the potential of digital health for reasons I have covered in previous editions of this newsletter. From a market perspective, where there is unmet demand there is opportunity and sadly there are already high levels of unmet need and unmet demand is growing. Digital health offers solutions to some of healthcare's biggest challenges and yet it is a bit part player.

When you experience healthcare, my bet is that you are exposed to Health IT, medical devices and pharmaceuticals... but digital health? It's not mainstream in spite of the many market reports shouting headlines of its ever increasing value.

So let's take a very small, more positive leap into the future.

Imagine going about your daily life whilst your wearable device monitors your vital signs, your behaviour and even your mood. Much like an antivirus program that learns your typical behaviour during its post-installation phase, your wearable device will become accustomed to your daily routine and your body's function. Without being intrusive, it will help you lead a healthier life and pick up on any deviations from the norm. Very probably hosted by an AI-powered chatbot of some sort, this is the front end of a new and powerful, digital first healthcare system with the following key characteristics.

• When this system picks up on trends that indicate a gradual slide into ill health, it will be intelligent enough to offer digital therapeutic interventions, monitoring their efficacy and where required, alter the nature of the intervention to produce the best results via feedback loops.
• When appropriate, it will help you access medical devices and drugs, delivered to your door with information and guidance on their use at the time you need it.
• These services will be complimented by the provision of advanced mobility aids (exoskeletons) and domestic robots to help those with physical limitations lead more normal lives.
• Although this intelligence will escort you through a range of digital first services tailored to your own needs, it will know when human expertise is required and will provide easy online access to human doctors who can access your health records and essential data collected by your personal digital health system.
• It will help you to arrange appointments with primary care, secondary care and allied healthcare professionals either through remote consultation or where appropriate in a physical form. The system will gather and share all relevant information ahead of the consultation and collate the resulting information and decisions made during these appointments and combine it with the continuous data obtained from monitoring your daily routine into your records.

A big leap into the future? Most of this capability is already here and what is missing will soon be available as the field of digital health becomes ever more sophisticated. It will be designed to address the healthcare challenges of the 21st century.

So is this how healthcare will look in the future? Almost inevitably but the big question is how will our existing (sick care) systems transition to more appropriate, sustainable models?

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A Chronological History

I am not an influencer and I do not have a crystal ball but I do have a track record of illustrating the dynamics of the digital health market over the last 15 years and why such dynamics are in play. I have thought long and hard and have tried to validate what could be controversial thinking by sharing this with others.

2009: I launched what might be the first digital health strategy in Europe. I was as enthralled as any of today's digital health enthusiasts who post on LinkedIn about the latest digital health technology but within a few years, the underlying reality of the market became apparent.

2013. D Health (my UK company) held a workshop in London to explore the barriers to the adoption of digital health at scale. What resulted was a daunting list; it was clear that the embrace of digital health by traditional players in healthcare was going to be a long and slow process. Other routes to market were needed.

2016: I authored a white paper entitled "The emergence of alternative healthcare systems" which described the likely rise of new, digitally-enabled consumer oriented healthcare systems. With so many barriers to adoption of digital health technologies by our established healthcare systems, I reasoned that unmet demand would grow and would be serviced by alternative, more fleet footed, digital first providers. I still have the paper in pdf form.

Winter 2017/18: D Health held six workshops; in London, Stockholm and Madrid. We invited delegates to explore the likely nature of alternative, emerging digital first systems and the likelihood that new, virtual first healthcare providers would emerge (that would be separate from, but interact with, our existing systems). Of the 80 executives drawn from healthcare and the life sciences, 96% considered the emergence of such alternative healthcare systems to be likely. We predicted we would see the beginnings of such systems in the next 5 years.

The logical end point of this trend, driven by merger and acquisition, would be a handful of giant, digital-enabled healthcare systems providing global coverage (I only have the final report in pdf form and given it contains delegate names, I don't feel comfortable sharing publicly but as you might expect, given the caliber of the attendees, it was fascinating to read this content after a gap of 5+ years).

2019: I organised "The corporate working group in digital health" which met between 2017 and 2019; a forum for representatives from global companies to network and learn about digital health. In one session, we created small groups to work up transitions scenarios to model the transition from our current sick care systems to sustainable digitally-enabled healthcare models. Everyone struggled. The only believable scenario was transition due to deepening and sustained crises. Although there has been a long build up to this moment in time, I believe this chapter has just started.

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The Alternatives Scenarios

You may have read this with interest but harbour some degree of skepticism. If so, let's consider alternative transition scenarios after all, change will happen.

Here are some examples; you can be the judge as to how credible these might be.

• Our healthcare systems suddenly begin to change towards sustainable, digitally-enabled models at a rate never experienced to date (perhaps driven by government policy, citizen protests, etc - your task is to complete the scenario).
• The rise in chronic disease abates (through personal change and governmental policy etc - see my comment above) and the needs of our massive ageing population are catered for by a new army of carers (funded by?) whilst a massive new wave of healthcare professionals are rapidly trained (and paid for by?).
• On a global basis, our healthcare systems are overwhelmed and access to quality healthcare is the privilege of a wealthy minority whilst entrepreneurs fail to put the increasingly sophisticated pieces of the digital health jigsaw together; the full potential of digital health is never realised.
• The life science industry provides cures or effective management for the majority of chronic diseases, offering affordability and sustainably based on these new pharmaceuticals and medical devices which also cater for the care needs of an ageing population along with a new wave of carers and healthcare professionals... (paid for/trained etc... see my above comments).

This is not intended to be an exhaustive list and you may want to think long and hard about other scenarios. You may find some truth in this exercise but feel that such a level of discomfort would not sit well within your organisation?

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Transition Scenarios

I have touched on transition scenarios previously as they are a useful addition to the strategist's portfolio. Transition scenario planning is an essential tool in the strategists tool kit and in the context of digital health I would argue that the following is an absolutely essential exercise at this moment in time. Try it!

Invite small groups of colleagues to experience an intellectual challenge. Provide them with a private room, coffee and a deadline to come up with a believable scenario by which our current healthcare systems across the globe will become sustainable. It's more fun if several groups work in parallel such that at the end of the session, they must present their scenario to the other groups (or even the wider organisation). What starts as an enthusiastic discussion will become a slightly frustrated and concerned dynamic as they begin to struggle.

If you felt that the emergence of new digital first healthcare systems was laughable on first reading, having thought about the alternative scenarios, you may feel the emergence of new digital first systems now has more credence.

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Where are we now?

Across the globe we are now experiencing the consequences of well known adverse trends in healthcare. They were meant to be the drivers behind the rapid rise of digital health but the players in our established healthcare systems across the globe have proved to be highly resistant to change and they have not changed quickly enough. As a result, we are entering a new chapter of periodic crises which will lead to a deepening and sustained global crisis. Whilst access to healthcare has been a long standing issue in many developing countries, those who are used to easy access to care will find this far more than challenging; even for those who have money.

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Signs Of Emergence

We are only in January of the New Year but news has already broken about new, digital first approaches to service provision by the likes of Amazon/Omada and Lily but these are only the latest headlines. The US in particular has seen the rise of so called aggregators in recent years. A digital front door and a host of complimentary, interlinked digital services are the first tentative steps.

Please check out the following links to find detail on some of these more established aggregators:

• Walgreens find care: Find Care | Services | Walgreens
• Evernorth Digital Health Formulary: Evernorth Digital Health Formulary? | Evernorth
• CVS Heath Point Solution Management: CVS Health Expands Point Solutions Management with New Health and Well-being Benefits and Comprehensive Evaluation Process

It's worth noting that CVS Health, Evernorth Health Services and Walgreens ecosystems have seen limited portfolio growth across their 5 year period from launch while the relatively new UHC hub from United Healthcare has aggregated 20+ offerings within a year.

You can add Virgin Pulse, Castlight, Sharecare, Collective Health and Solera to this list; many other slightly smaller players too.

I will cover DTx in another edition but suffice to say for now, these aggregators are a life line for the digital therapeutics community who currently find routes to market constrained.

This represents progress towards a new type of system but only the first tentative steps, so the question to ask is what kinds of organisation will lead the way?

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New Leaders

Whilst these aggregators are a first step towards the evolution of new, digital-first healthcare systems they are a long way from the system outlined near the beginning of the article. They are of course worth monitoring but will they continue to evolve or will new players lead the way? From a strategic perspective it's worth considering the characteristics of organisations that might create these advanced digital first systems.

• Digital Front Door: Whist this is not a new phrase, a digital front door will be an essential characteristic of these new providers. The front door will lead new potential users on a journey that quickly illustrates how the system works and its benefits. After supporting an easy and thorough trial it will offer increasing levels of service tailored to the end users needs whilst keeping the complexity of the system largely hidden.
• Trust: This is the big one and where many of the current tech giants do not score highly. Building a brand based on high levels of end user satisfaction in terms of health outcomes and affordability must sit alongside the highest levels of data protection and privacy.
• Marketing Reach: The system in question will rely on scale and so existing organisations with massive reach will be extremely well placed. Will these be tech giants, pharmacies, supermarkets...?
• Digital Natives: It goes without question that the skills, expertise and culture of an organisation which delivers a seamless digital health experience capable of hiding the complexity from its end users must be "digital by nature".
• Healthcare Natives: There has been much criticism of the tech giants efforts to enter digital health some of which originates from the view that that you must know something about healthcare to play this game. There is much truth in this when your success relies on engaging with the complexity and dynamics of our established healthcare systems but if you can start with a blank piece of paper, is it an advantage NOT to be burdened with legacy mind sets dressed up as experience?
• Business Models: Whilst I have described in outline the nature of a digital first system (and can provide far more detail than this newsletter allows), a key component to the reality of such a system will be the business model. It can be argued that some form of health insurance would work or that a pay for access model could consist of different levels of service based on yearly subscriptions with extra charges for specialist services or access to physical providers. The potential interaction between existing public and private healthcare systems and new, digital first providers is a fascinating area ripe for exploration. Could governments pay for their citizens to access a privately run system to provide a form of universal healthcare coverage?

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Origins

So what types of players in the healthcare ecosystem could lead the charge? Will it need an organisation from outside of health, unencumbered by legacy thinking, to lead the way?

• Perhaps the only way any of the current players from outside of healthcare could move on this opportunity would be to create an autonomous subsidiary. This could mitigate reputational trust issues and allow freedom to operate largely free from its parent's corporate culture.
• The counter argument is based on brand. Brand is a powerful thing and to have an existing, trusted healthcare brand to act as a launch base would be highly advantageous.

Perhaps the middle ground is the creation of an autonomous subsidiary by an established name in the healthcare pace with a great brand.

The other scenario to consider is a start-up; either a start-up in the true sense of the word or a start-up that evolves or pivots to a degree not seen in the market before.

Start-ups with reach and digital front doors in the form of, for example, symptom checkers could be candidates. Those who have reached significantly into a specific market (mental health?) could be well positioned to expand from there but I suspect the mindsets even within successful digital health companies may have inhibitory legacy issues.

Perhaps a clean slate is required? Admittedly, such a start-up would require a significant amount of funding and when digital health emerges from its current trough it will come back stronger. "Dumb money" will be a thing of the past and the new realism that dictates digital health must obey the basic principles of business will be in place (the dot com moment in digital health's evolution is passing).

At that moment, would a proposition to put the existing pieces of the digital heat jigsaw together to meet the needs of our citizens in a way that our established providers cannot seem so far fetched?

• Are digital health technologies available to support this?.
• Can a commercial model be developed?
• Is the talent there to do this?
• Could this be funded?

My gut feel is "four ticks".

The alternative?

Please read this article again and choose a more likely future. I would be interested to see this in the comments section.

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