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Digital Future of Healthcare

Article-Digital Future of Healthcare

doctor in a digital graphics
Digital revolution is in its early days but it is expected to have a profound effect on

“The healthcare industry is shifting to a patient-centred model that harnesses technology to both open communication channels and create a platform for patient engagement,” said Doris Savron, executive dean for the College of Health Professions at University of Phoenix, in a statement. “Given this shift, it is crucial that patients not only have access to these technologies, but also view them as important resources for improving their health and overall care experience.”

Digital revolution is in its early days but it is expected to have a profound effect on
healthcare delivery.

By digital health is meant all “disruptive technologies that democratise the access to data, information, devices and procedures in healthcare”. It also extends to “tearing down the Ivory Tower of medicine and empowering patients at the same time”.

A look at the sectors around us that have been affected by digital disruption escalates the need for healthcare to promote digital transformation as a strategic priority.

  • Uber is upending the taxi Industry
  • Airbnb is threatening hotel revenues
  • Netflix, Hulu and similar services have radically changed the TV industry dynamics.

McKinsey’s recent Digital Enablement Survey, shows that healthcare organisations are devoting an increasing proportion of the IT budget to build digital capabilities rather than supporting core IT infrastructure (e.g. claims processing systems). This is expected to account for more than 50% of their strategic IT budgets within the next 3 to 5 years.
Digitisation can help payors and healthcare delivery. It will have a significant positive impact on payer economics, primarily through four levers.

Lever 1: Stronger connectivity

This will enhance a greater consumer experience. It will also enable payors to engage more effectively with providers.
It will provide more sophisticated, digitally enabled tools to manage population health and also provides a clearer method for gauging the quality of care delivery.
In addition, it will provide for better collaboration and data sharing with providers which will support more effective care coordination.

Lever 2: Greater efficiency and automation

Automation is defined as the use of control systems and information technology to reduce the need for human work. It also increases efficiency. As healthcare transitions to population health, automation goes from “nice to have” to a “must-have”.
As automation is not subject to human error or fatigue, they can provide consistent basis for care activities and improved quality. It also improves predictability of outcomes and provides for a higher throughput.
Efficiency is further aided by “data driven” insights.

Lever 3: Better decision-making

Digitisation allows for advanced analytics and big data insights and will make it possible to implement value-based reimbursement which, through advanced analytics, can be extended to population health. It will have a direct effect on the economy as a whole.

Lever 4: More advanced innovations

Digital support allows payors and governments to think more broadly about their business models and care delivery innovations.

New approaches to care delivery have the potential to hold down costs. These include wearables that monitor the health status of patients with chronic conditions, telemedicine, and “virtual visits” that reduce the need for in-person physician consultations. This, however, must be qualified to be extended to the doctor’s patients, and within the specified period of last face to face consultation. There will also be a need to qualify extent of treatment and medications prescribed.

Digitisation can also make healthcare more accessible by giving patients easy access to their medical history, and help them locate nearby clinicians, specialists and facilities.

By a combination of these four levers, payors can achieve a significant impact on the way healthcare is delivered and managed.

Financial Benefits of Digital Transformation

  • The average savings are predicted to be about 10% to 15%, i.e. $15bn to $25bn.
  • Over a long term, there is bound to be a significant decreased spending on medical services. Most of the savings will come from substitution of lower cost efficient services for more expensive alternatives.
  • Most of the primary care services are likely to increase as would spending for those services. It is estimated that the increase in costs will be affected by lower utilisation of more expensive services.
  • Consumers will be the primary beneficiaries of the lower spending, but some of the savings will accrue to the payors and providers.

To get the buy-in by healthcare professionals, one has to advance rational reasoning and incentives.
The present healthcare delivery is focused on cost savings far more than quality. Often corporate involvement assesses the benefits solely based on return on investment or impact on the bottom line of “balance sheets”.
The advancement of digitisation must benefit the patients. There must be quality outcomes, wellness enhancement and cost savings. To achieve this, one must factor in the cost of digitalisation to the providers of care and also extra skills and responsibilities on the providers. It will not work if the providers are not reimbursed appropriately against the savings realised. This has to be a transparent and responsible participation of all the stakeholders.
At present digitalisation is financially more beneficial to payors whilst providers are not incentivised adequately to participate in this digital transformation.

Digitisation and Chronic Healthcare

Digitisation has been described as a most innovative programme for the future of healthcare. By 2025 it is estimated that the spend on chronic healthcare will be as much as 67% of the total healthcare spend. This will impact the way patients receive healthcare and the manner in which providers are reimbursed.

The digital revolution will help to manage chronic care, allow for early diagnosis, avoid increase in co-morbidities, decrease hospitalisation, promote healthier populations and manage the rising healthcare costs.

This is a major concern as we prepare for the future and navigate a challenging healthcare journey towards 2025. Many healthcare programmes are setting a target of total digitisation by 2020.

Digitisation is the Future of Healthcare

We need to embrace this debate and switch to a digitalised healthcare platform. There will be different channels available to stakeholders depending on how competent they are. But the change has to start now. Healthcare must embrace the digital revolution to stay relevant. Providers must embrace this change as the evidence is clear that competent digitalisation is the destination for the future of global healthcare.
To support the impact that this programme will have on healthcare, venture capital investment into digital health more than quadrupled between 2011 and 2015 (from $1.1billion annually to $4.5 billion).
We must not lose sight of the people driving the demand for this technology and their needs – the patients, citizens and communities for whom it will be put to work.

References available on request.

Prof Morgan Chetty is the Chair of the Healthcare Management Conference at the Africa Health Exhibition scheduled to be held from 29th to 31st May in Johannesburg, South Africa. 

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