Digital Health—Turning Promise to Tangible Gain

Innovations in digital health offer great promise to health care providers, payors, and patients alike. However, we must not fall into a trap of thinking that tech will turn up and solve all our problems. From an investor’s perspective, the upside can be realized only when innovators and enterprises grasp core health market dynamics and, more specifically, how to build a revenue stream that continues to flow after the initial pilot funding has dried up. Below are some core fundamentals that should be borne in mind when thinking about whether and how to implement digital health solutions. This is not an exhaustive list, just some perspectives.

·        Regulation: In many countries, innovation runs ahead of regulation. Failure to remedy this lag can stymie digital health from reaching its potential. For example, some countries have regulations on the books that prevent teleconsultations of medical professionals or writing medical prescriptions electronically (e-prescriptions), two innovations than can lower health care costs. As more governments adopt universal health coverage goals and nationwide social insurance schemes, they should regularly review their regulatory framework to ensure it fosters, not deters, tech innovation.

·        Systemize, Don’t Silo: Often, innovation is led by the smaller entrepreneur—perhaps too often. To ensure broader implementation, it would be better if more large entities, be they public or private, placed themselves at the vanguard in adopting health tech. Digital health should be an integral part of any future health system design. Otherwise, it will be left in silos with the full potential untapped.

·        Changing Mindsets: Across the spectrum of health professionals, greater effort is needed to help them understand the positive development impact of digital health. Professional associations can be part of the process of changing mindsets. It could be argued that this change needs to begin in educational establishments with a sharper focus on how to adopt and deploy innovations. In short, innovation must be embraced and not viewed as a threat.

·        Involving Payors: It would be great if payors and providers worked more closely together on digital health, especially in emerging markets. Very broadly speaking, payors fall into two camps: legacy, paper-based processors that account for care using a fee-per-service formula, and those embracing more holistic concepts of value-based health care. It is the latter that is most enthusiastically embracing the digital health agenda. Health insurers can support government initiatives to roll out social or national health insurance schemes by advising on how best to pay for digital health-related services, advocating for systems that help fulfill public sector requirements.

·        Public Acceptance: Patients and consumers in many markets are being bombarded with digital health options, which confuse some and turn others into skeptics. For example, the proliferation of tech solutions for managing health care data can create unhelpful data silos, while an explosion of health apps on the market can foment a ‘big brother is watching’ mindset. Digital health must benefit the consumer—and the consumer needs to clearly grasp those benefits.

·        Cost of Data: Increasingly, I am asked to review potential digital solutions in the health data domain that may be relevant to emerging markets. In vetting such solutions, I have gained a growing appreciation of the need to estimate their cost. Data costs need to be low enough to support mass consumption of some of the products. In addition, countries need to develop their IT infrastructure to have sufficient data network bandwidth to realize the true benefit of digital health.

At IFC, we are always looking for ways to embrace innovation and invest in it as we believe in its potential to deliver better value, higher quality care. For example, we have created the regionally-organized matchmaking program TechEmerge to spark connections between innovators and providers. When it comes to digital health solutions, a key measure of success is the ability to fully implement, replicate, and expand. The pros of health tech do outweigh the cons, however to avail of them you must be ready, willing, and able to implement widely and to scale up while being mindful of potential constraints.

Keep up with the latest on private health care in emerging markets by following the IFC Health LinkedIn showcase page.