There are seminal moments in the evolution of healthcare – think the invention of the stethoscope, the discovery of penicillin, cracking the genetic code. We're in such a moment today, and the organizing principle of this current wave is data-driven digital transformation. Through technology, healthcare information is becoming more granular, more liquid and more relevant, and it's being employed with greater efficiency and effectiveness.
We're entering the third wave of digital healthcare. The first wave, dating back to the mid '90s, was about the Internet and connectivity. The second, more recent wave of the '00s has been dominated by mobility. And the third wave, currently underway, is about the mass personalization of healthcare. It's about trends like the quantified self and the increasing awareness of consumers that they are the stewards of their own health.
It's also about software, mobile platforms and the power of data to not only intervene earlier but intuit health issues before they occur. For providers, it's about employing technology solutions to close the gaps in care delivery, about extracting greater value from data and delivering real results against healthcare's triple aim - improving the experience of care, improving the health of populations and reducing per capita costs of healthcare.
Riding that third wave
Wearable and nearable technologies are integral to this third wave of digital medicine. Wearables – wristbands, monitors and an ever widening assortment of purpose-built wearable devices like the smart contact lens and the smart bra (no, not a misprint) - are recalibrating where and how healthcare occurs. They remove the complexities and inefficiencies of facility-based care and replace traditional, hidebound delivery processes and venues with on-demand, self-directed diagnostics and personalized therapeutics. And nearables – small, wireless devices equipped with sensors that work as transmitters of data – are incubating healthcare's Internet of Things.
It's a quantum leap forward in healthcare delivery, quality and cost savings, and it's unfolding right now, right before us. New research indicates that digital health solutions will save the American healthcare system more than $100 billion over the next four years, and FDA-approved health solutions (33 in 2014, more than 100 by 2018) are changing the patient-provider dynamic, raising consumer awareness, accountability and engagement.
Wearables represent a huge proportion of that growth. According to an IDC report, consumers and businesses will buy nearly 112 million wearable computer devices by 2018, a 78.4 percent growth rate from 2014's predicted sales of about 19 million units – and most of these gadgets fall in the realm of health-related devices. But is this upsurge in wearable adoption really new? After all, people have been living with pacemakers, cochlear implants, implanted biochips and other medical devices for years.
The human factor
What's new is a degree of functionality that allows individuals to take personal responsibility for their health, coupled with more powerful, cheaper devices. Wearable technologies provide new insights into the lives of their users. They activate consumer self-awareness and promote "actionable" conversations with a care circle comprised of providers, family and friends. And they are more sophisticated - wearable features are growing beyond personal wellness to become more medically interoperable, for chronic disease monitoring and for data integration with enterprise systems.
There is also a subtle but influential human factor in play: The culture of healthcare delivery is changing as providers and patients become comfortable with personalized devices, with an electronic dialogue and with the efficiency and convenience of virtual medicine in an already stretched industry. But this cultural shift is not principally defined by access. Wearables provide a foundation for "everywhere care" stakeholder partnerships that promote accountable preventive care. Collectively, these trends are reordering the structure of the provider-patient relationship and increasingly positioning the consumer as their primary health manager.
Whether worn on the wrist, head, foot or body as a garment, wearable devices are being designed in every conceivable form factor, with convenience and utility in mind. Some are even beginning to be devised for use inside the body. Using sensors to measure various aspects of a patient's health, wearable devices now offer richer, actionable data that extend beyond body diagnostics. They now can educate, alert and anticipate health issues.
Connecting to the Internet of Things
But wearables are not strictly a product play. These technologies are increasingly being integrated within a larger catalogue of mobile and cloud platforms, enterprise systems, clinical workflows and consumer health solutions. With guidance from the NIST, FDA and others, we're seeing an increase in device integration with the EHR, PHR, office systems and patient portals.
It's here that wearables meet the Internet of Things. Apps that capture and interpret data, integrated enterprise and cloud data repositories and the networks of these devices form the underlayment of healthcare's IoT. IoT-enabled wearable technologies offer a huge opportunity to deliver actionable insights at the point of care, circumvent the lack of interoperability imbedded into vendor systems and improve diagnostic accuracy and promote patient engagement. Via the IoT, data generated from wearables can be streamed seamlessly to provider and enterprise systems and the cloud, to paint a more complete picture of the patient's condition, and spark intervention.
In addition to the benefits of "actionable" self-awareness and clinical convergence, wearable healthcare technologies are a rich source of information, and not only to measure various aspects of an individual's health. In the coming years, patient-generated health data from IoT devices will be the key to population health management, to gleaning reimbursement in a value-based world, and to producing measurable gains in outcomes and patient satisfaction. Arguably the biggest winner in the wearables sweepstakes, Big Data derived from wearables will be used to extract value and identify long-term patterns and risk factors for clinicians and researchers.
A change in markets
To date, the wearable space has been a largely retail market, fueled by fitness- and health-related devices. Gartner predicts that by 2018 through 2020, 25 percent of fitness monitors will be sold through non-retail channels, including gyms, wellness providers, insurance companies, employers and weight loss clinics, at subsidized or no cost. That market dynamic is changing, as new products appear and new economic incentives (like the ACO and risk sharing) gain adhesion.
Beyond the fitness crowd, there is a shift in healthcare spending underway, revealing some interesting demographic trends. Millennials are becoming health "hackers" and fueling wearable diversification, due partly to their skepticism about the U.S. healthcare system and their bias toward wellness. Seniors are becoming more activated in managing their health issues, and they're finding wearable devices to be comfortable, convenient and effective. The increasing sophistication of wearable devices is drawing a wider consumer base, including the chronically ill, the caregiver and the aging in place.
Payers are also entering the fray. A shift to value-based reimbursement, bundled payments and wellness incentives is creating a fertile ground for adoption of new business models and clinical approaches incorporating wearable solutions. In the thrust towards value-based care, payers are beginning to cover member costs for wearable technologies that are deemed medically necessary. The payback? Patient accountability, patient engagement and patient (member) satisfaction) – and, lest we forget, huge cost savings. Doctors will uncover new methods for the diagnosis and treatment of their patients, which will likely impact doctors' relationships with the insurance companies who can accommodate wearables as well.
FDA-approved devices have already started to disrupt the traditional provider-patient dynamic, introducing shared accountability, earlier intervention and better outcomes. In 2014, web-enabled medical devices increased treatment adherence and behavior modifications while simultaneously decreasing urgent episodic medical care and costs totaling $6 billion.
Challenges ahead
There are challenges ahead for wearables in healthcare. As the capabilities and numbers of IoT devices continue to grow, will we be over-measured and burdened by our quantified self? And can wearables truly effect behavior change across the range of healthcare issues and constituents? Will we be overwhelmed by Big Data? As the volume and complexity of wearable data grows, the technology creates challenges for service providers that are transporting the data and the firms that are collecting and analyzing that data. One of the great challenges will be to curate, manage and process data at or in near-real time.
With entrepreneurial and innovative spirit the IoT is inserting itself into healthcare in unexpected ways, and its ultimate speed and trajectory are at this point unclear. Will IoT-enabled wearables and nearables supplant traditional care delivery? Will activated health consumers alter the calculus of population health? Can the IoT truly crack the code of patient privacy and data security?
This is a rapidly evolving technology space, unbound by healthcare's information silos, cultural parochialism and industry skepticism. It's a clear field. Looking ahead, what we can expect is an increasing range of innovations and interventions that leverage the convenience, efficiency and clinical effectiveness of wearables and the IoT.
Rick Krohn is an expert in mHealth corporate strategy and strategic marketing, business development, product development and commercialization and corporate communications, whose consulting experience spans the healthcare, telecommunications, education and technology fields. He is the author of more than 100 articles on a wide range of health technology topics as well as the HIMSS book mHealth Innovation: Best Practices from the Mobile Frontier (2014). He can be reached at 912.220.6563 and rkrohn@healthsen.com.
