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Digital health is hot at CES

ces010813000007-4_3_r560The Consumer Electronics Show is underway in Las Vegas and the theme for this years show seems to be mobile and digital health.  Seismic shifts are occurring in the health industry. Policy is changing at the federal level, cultural attitudes about wellness are evolving, and new forms of technology are transforming the way patients relate to their bodies and the way clinicians practice medicine. One of the most important trends to watch is the growth of the digital health sector.

Rock Health released its 2012 Year-End Funding Report. The findings indicate that digital health technology will continue to thrive and become an increasingly significant part of health care industry, as well as the entrepreneurial ecosystem.  However while digital health may have good intentions and while the range of gadgets may intrigue us the real question is will consumer embrace this technology to help them manage their health ?


Venture capital funding of digital health grew dramatically in 2012. Investors funneled 46 percent more money and made 56 percent more deals in health care in 2012 than in 2011, with the cumulative funding totaling $1.4 billion last year. This sharp incline contrasts with declining investment in traditional healthcare fields, like biotechnology, life sciences, and medical devices.

The most common theme for investment was health consumer engagement, which represented $237 million in funding. Navigating the tangled health care industry can be daunting. These companies help consumers figure out which care options are best for them and connect them with well-matched providers. Interest in these services is exploding among consumers and investors alike as the implementation of the Affordable Care Act (aka Obamacare) looms closer. Of the five largest deals, which represented more than 20 percent of the entire year’s funding, four were in this area.



These devices and gadgets are becoming easier to use and if they succeed in changing consumers health behavior than they are worth every penny.  The biggest challenge is going to be “do consumers have the time to monitor their health (i.e. upload and review data) and will they like what they see ?  I know one person, for example, who was quite upset when her Fitbit informed her that she spent 85% of her time sitting.  “I work in an office, and I usually just go from meeting to meeting.  What the hell am I supposed to do ?”

Another trend in digital health are gadgets targeted to increase adherence and compliance.  MediSafe Project, an Israeli health IT startup, says data it has collected since the November launch of the cloud-synced app for Androids and iPhones shows a patient adherence rate of 81 percent. That exceeds the 50 percent average medication adherence rates for patients taking medication for chronic illnesses in developing countries listed by the World Health Organization. The company claims an even higher rate — 84 percent –for users taking statins to lower cholesterol.  U.S. pharmaceutical companies have been increasing their budget allocations for patient adherence. Since 2009, budget allocations have increased 281 percent to $1.5 million in 2012.

Look to the Future

From 2010 to 2011 usage of remote patient monitoring, or telehealth, increased by 22.2 percent as the number of patients enrolled worldwide reached 241,200. However, telehealth device revenues only grew by 5.0 percent from 2010 to 2011; and 18.0 percent from 2011 to 2012. InMedica, a division of IMS Research(now part of IHS Inc. (NYSE: IHS)) attributes slow revenue growth over the last year to poor economic conditions leading to restrictions in healthcare funding particularly in Europe, and ambiguity on the impact of healthcare reform and readmission penalties on telehealth in the U.S.

Telehealth is projected to be increasingly incorporated into post-acute care strategies from 2013; it is listed by CMS as one of 13 possible models to reduce readmissions. In addition, as a larger number of patients enter the insurance pool, healthcare payers are projected to adopt telehealth as a population management tool to reduce in-patient costs. Consequently, InMedica forecasts that in 2013, the telehealth market will grow by 55 percent worldwide, in terms of device and service revenues.

There will come a time when patients, as they talk with their physician, can review the information from their digital health devices.  Some devices, for example, allow users to scan food items to track what they eat and this could lead to a discussion around poor eating habits.  Imagine if your iPhone or other smartphone was connected to your device and routinely collected data which it then transmitted to your personal digital health website.  A user could simple choose to send the data to his or her physician where it could be reviewed during office visits.

The important aspect to remember is that while there is a lot happening in this area we are just scanning the very top of what could happen in digital health.  It’s like comparing MS-DOS and an old 486 PC to today’s iMac and Windows 8.  We are moving more to a connected world via mobile devices and for the first time it’s expected that tablet sales are going to be bigger than PC sales.   There is a lot of reason to be excited but a strategic approach that focuses on patients outcomes is needed rather than an approach that asks “what’s the ROI?”.



5 thoughts on “Digital health is hot at CES

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