Prescriptions, pregnancy, prevention, payments: how digital health savings will come to pass
Whoever wins the the 2016 US presidential election has their work cut out for them with adjusting Obamacare, also known as the Affordable Care Act. According to new data from the federal government reported by The New York Times and a Kaiser Family Foundation study, premiums will increase by as much as 25% for some plans next year, and more insurers are rejecting the “public option” due to the losses they’ve incurred.
For the record, the Democratic nominee, Hillary Clinton, has promised to maintain the ACA and addressed rising premiums along with other issues, such as reducing out-of-pocket costs and prescription drug prices. In contrast, the Republican nominee, Donald Trump, has called for the outright repeal of the ACA if elected, outlining instead a strategy of full tax deduction for premiums and changes to how insurance policies are sold and marketed.
Healthcare fintech startups, however, are already developing some of these moves. Digital health funding rose to $6 billion in the US last year, leading StartUp Health to dub it, “the year it hit its stride” as the investment climate changed to favor customer service, wellness, and e-commerce.
Hixme, a private online healthcare exchange startup, aims to reduce costs and make it easier for families to customize plans without having to enroll in the group systems that small and mid-sized employers already dislike having to deal with. Founded in 2014, its cloud platforms customize plans based on user data. Diagnostics and therapy services would also benefit here, reducing time and costs for developing treatment plans for patients.
Its focus is in online private exchange networks, which it believes will replace traditional group plans. But there are many other ways companies aim to reduce healthcare costs in the US.
The cloud option is particularly attractive for two reasons: one, it reduces physical burdens on officers, as the savings will accrue in terms of equipment and administrative (IT) staff.
Research applications from cloud data sharing advances are also a possibility, especially for areas of medicine where case studies have been limited by small sample sizes, like women’s fertility for pregnancy apps such as Clue.
Transparency and billing
Information exchange – and transparency about rates – is one of the most common methods for reducing costs. Companies in this field also include MDSave, dubbed the Expedia of healthcare, which lets, “patients comparison shop for medical procedures and guaranteeing nearly immediate payment for providers.” A similar service, MyChoiceMD, is being rolled out with an emphasis on helping the uninsured save costs when searching for treatment. For larger companies, the Castlight service offers similar service savings by comparing treatment options in their network.
High prescription costs are a major feature of US healthcare expenses, and apps to help with this have been developed, like MediSafe, which helps patients keep track of their medicines to reduce money-wasting duplication and missed dosages: nationwide, these mistakes add $300 billion per annum to healthcare costs, reports Inc, so this is no small change.
Customer service applications, from companies like MedPilot and Calibrater Health, advertise that they will reduce costs and the stress of the billing process, one of the least enjoyable aspects of the healthcare industry for all the players involved.
Another cost cutting measure could be achieved by rollout of blockchaining from the financial services sector to healthcare to improve data sharing among patients, insurers, and providers. According to FinTech Law Watch, “The end benefits may include lower administration costs, faster claims processing and less fraud.”
Preventive and out of office care
Telemedicine is also a cost-saving option, reducing the need for expensive in-person visits. More than just a diagnostic service, these sites – including Teladoc, Pager, and Fraunhofer FIT – offer out of office consultations for a fee. Telemedicine may also be increasingly paired with house call apps, like Heal, to lower emergency treatment costs. (Again according to Inc, unnecessary in-person visits costs $125 billion a year in the industry.)
The market is expected to grow to over $36 billion on the US by 2020, driven by personalized healthcare demand.
And not all of these emerging healthcare companies will be limited to the US. ZhongAn in China, for instance focuses on insurance markets, including health and emergency care. There is also FinanceFox from Switzerland that serves as a clearinghouse for consumers seeking plans. Another startup, 7peaks, in Denmark hopes to lower healthcare costs by developing preventive treatments that, by encouraging healthy living, will translate into savings.
Looking ahead, preventive care is a major growth area since a healthier patient will be one with lower risks, and the associated premiums, for those and less susceptible to chronic ailments or regular infections.
Preventive care advances from companies like 7peaks or KurboHealth, specializing in obesity treatment, would save hundreds of billions of dollars’ worth of healthcare costs every year.
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