In 2020 health tech finally had its day in the spotlight and made it into nearly every provider organization due to the coronavirus pandemic. However, as more and more Americans are vaccinated, some of that brick-and-mortar care will return.
Regardless, it's clear to see that digital health is here to stay. MobiHealthNews did our best to look into the crystal ball and made five predictions about what will happen in that space this year.
Telemedicine usage will even out, but will retain a number of new adopters
During the early days of the coronavirus pandemic we saw unprecedented use of telemedicine. In fact, a study in MMWR and Morbidity and Mortality Weekly reported that telehealth visits increased by 154% during the last week of March compared with the same period in 2019.
This gave patients more exposure to digital tools, and telemedicine in particular. But as clinics and hospitals begin to invite patients back in, there will be some evening out.
However, it’s unlikely that telemedicine will return to pre-pandemic rates now that users have been onboarded to the process. Most likely a select group of patients will opt for telemedicine by default and others will use it in certain situations, such as urgent care.
In fact, according to the Accelerate Health 2020 Consumer Telehealth survey, a poll of 2,052 individuals balanced to the U.S. population, 77% survey-takers said they would be willing to use at least one type of telehealth technology once the pandemic has ended. Additionally, 41% of respondents said they would prefer telehealth for specific circumstances once the pandemic is over. However, that still leaves the bulk of survey takers preferring the in-person care model.
“If you look at the peak, when 30-40% of all visits were virtual, that came off pretty quickly as the healthcare system reopened. But it’s also leveled off around 10% of business right now, and I think, as people now have this as a tool in their arsenal, there is going to be a lot of innovation around digital care,” Paul Brient, SVP and chief product officer at Athenahealth told MobiHealthNews.
We'll see more digital health IPOs, as well as more SPAC deals
2020 was the year of the digital health IPO. This year Amwell, Accolade, One Medical, Nanox and GoodRx all hit the public market. Meanwhile, Hims is looking to go public through a merger agreement with Oaktree Capital Management-sponsored special purpose acquisition company (SPAC) Oaktree Acquisition Corp.
Not only did we see companies go public, we also saw digital health companies flourish on the public markets. Teladoc, one of the first companies in digital health to go public (making its debut in 2015), continued to beat its revenue expectations in Q1-Q3 of 2020, in part due to the demand for telemedicine during the COVID-19 pandemic.
Meanwhile, Livongo, which went public in 2019, was acquired by Teladoc over the summer, giving early Livongo investors a hefty return on investment.
Because these companies are doing so well it’s likely that other digital health companies will take a page from this book and consider a public exit option.
“COVID-19 supercharged funding activity in digital health in 2020. Ten digital health categories had their best year with record funding amounts. It was also the biggest year for IPOs with six digital health companies raising over $6B. We could see a lot more companies going public in 2021 if the current IPO and SPAC boom continues,” Raj Prabhu, CEO of Mercom Capital Group, said in a statement earlier this week.
"The pandemic has mainstreamed the consumer side of digital health technologies in less than a year. Digital health products that were a novelty a year or two ago are now a necessity."
Companies will compete to become one-stop shops for healthcare
Over the last year, we’ve seen large digital health companies expand their offerings and move closer to an integrated care model or, for consumers, a “one-stop shop.”
Notably in August Teladoc acquired chronic care management platform Livongo for a whopping $18.5 billion. At the time the companies pitched this M&A as a way to provide “whole person” care that could change how customers access care. The deal brought together Teladoc’s traditional telehealth platform, Livongo’s digital coaching services and a slew of data that could be used for greater insights about a person’s health.
“Together, we will further transform the healthcare experience from preventive care to the most complex cases, bringing ‘whole person’ health to consumers and greater value to our clients and shareholders as a result,” Gorevic said in a statement at the time of the acquisition.
While Teladongo may be the poster child for a more integrated care model, it’s unlikely to be the only one. According to Exits and Outcomes, Teladoc’s rival Amwell is in talks with Omada. If this deal were to come to fruition, it would have a similar function to Teladongo, where patients can access digital coaching and telemedicine through the same company.
We’re also seeing direct-to-consumer virtual care platforms Ro and Hims, which both got their start in the sexual wellness space, move to expand their offerings and provide more of that holistic experience. For example, Ro recently purchased on-demand in-home care service Workpath, which is able to do home lab-sample collections. The company also covers a variety of conditions, including smoking cessation, weight management, allergies and prescription dermatology.
In 2020, we saw a lot of expansion from digital health companies. In 2021, we may see some movement from big tech and retail. Amazon in particular has spearheaded a number of health programs from its digital pharmacy to a new wearable.
It has also created a virtual primary care offering for its Seattle-based employees. However, in the future we may see more of a connection between these offerings, which could be a game changer for ease and convenience for health.
Digital mental health is here to stay
During the coronavirus pandemic we saw an uptick of folks accessing behavioral healthcare. Mental healthcare was seen as low-hanging fruit in the telemedicine space and, with new adoption rates, is likely to continue to grow.
Fueled by the significant amount of funding dollars poured into digital mental health companies this year, digital mental health companies will have the resources to expand.
“In H1 2020, digital behavioral health companies received $588M, roughly the annual funding for this segment in any previous year (total behavioral health funding in prior three years was 2019: $539M, 2018: $658M, 2017: $273M). Funding has gone to companies with a range of product features, from fully automated chatbots to video chat platforms with additional tools that augment patient-clinician interactions,” the authors of Rock Health’s mid-year report wrote.
While traditional telemedicine – where a counselor or clinical talks to a patient over video or phone – has made it to prime time this year, we’ve also seen a number of other mental healthcare delivery models grow. One of the biggest was digital therapeutics.
A slew of new products entered the market thanks to a new FDA guidance on digital health devices for treating psychiatric disorders that waived several regulatory requirements – such as the need to submit a 510(k) premarket notification – for the duration of the COVID-19 emergency. During that time both Pear Therapeutics and Akili Interactive released products early. Later in the year Akili landed a de novo for its product aimed at treating children with ADHD through a video game-like therapy.
"There's this open moment because of COVID where everyone is aligned. Patients are desperate and want solutions. Providers see that these walls are broken down, and they want to respond," Eddie Martucci, CEO of Akili Interactive, said at the DTx East web conference in September. "Everyone understands that we have this taste of efficiency and rapid ability to serve the patient, and we're seeing it happen in real time. I certainly hope that pace cements itself and doesn't recede."
While we are seeing more prescription digital therapeutics for mental health on the market, the industry is still hammering out its distribution and reimbursement efforts. We may see more clarity on this in 2021.
While telemedicine visits may even out this year, the mental health industry remains ripe for innovation. If anything, the year has shown patients and providers new use cases for treating behavioral health conditions digitally.
Price transparency tools will impact patient choice
As patients step up to the plate as consumers, there is an increasing pressure to know the price tag.
GoodRx is a startup that has been working in this space for some time. It got its start letting self-paying customers compare medication prices and discounts. Users could then print out digital coupons and bring them to their pharmacy with their prescription.
\More recently, the company moved into the telemedicine space after buying Heydoctor. The company now offers not only in-house telemedicine services, but also a price transparency tool for comparing where to get telemedicine services.
We’re also continuing to keep our eyes on the retail giants. In 2019, Walmart launched a new health platform that allows users to book appointments online at one of its clinics. What’s interesting about this is that it gives patients a range of how much the clinical care will be without insurance before they book.
Last January, the Centers for Medicare and Medicaid Services put its weight behind a price transparency rule, which would require hospitals to disclose to patients their negotiated prices with payers.
Theoretically the price transparency ruling would have left patients with more clarity about healthcare costs. However, in reality these tools are often difficult to find and difficult to use. We predict that in the future provider organizations are going to have to keep up with the growing transparency that retail clinics and telehealth companies provide.