Healthcare is the problem of our country, and if we don’t fix it, it will break the bank, our health, or both. It deserves the world’s best and brightest minds working on fixing it. But how we go about fixing healthcare matters. The strategic common denominator across big tech ventures into healthcare is that they are not primarily solving what healthcare needs. They are mainly solving how to make money with their respective core business, not helping customers.
Four of the top five biggest companies in the world are consumer companies, and healthcare is one of the nation’s biggest industries. Those massive consumer companies—Google, Apple, Facebook, and Amazon are all working to move into healthcare because they realize the size of the opportunity: a $4 trillion American industry that makes up 20% of the US GDP (and growing). They want a slice of this lucrative market that has little oversight.
The world’s biggest healthcare company (the 8th biggest company in the world), UnitedHealth Group (UHG), is not a tech company and is seriously lacking in the consumer engagement department. Still, they’re making a lot of money.
A consumer health company will win by placing patients first and ruthlessly building for them while still considering the realities of payor and provider incentives.
Poor engagement, caused by poor consumer experience, is one of the biggest problems in healthcare. One in five Americans hasn’t seen a doctor in 5 years or more, causing many diseases to go undetected and develop into expensive health conditions.
Existing players are missing the financial opportunity that could come from building a better experience for consumers that would engage them in their care. Imagine, for example, if a provider like UHG marginally improved experience and engagement—they could improve their profitability by billions. Now imagine an upstart rebuilt a version of UHG that was radically focused on consumer experience and engagement—the magnitude of that opportunity is hard to fathom.
We also need an Amazon of healthcare—the universal place people go shopping for healthcare services, insurance, and drugs—with trusted reviews, quality metrics, and price transparency. A typical take rate for a marketplace is 20%, but even a company that only took 5% of U.S. healthcare dollars would easily surpass the biggest companies of today.
Big tech companies fail because they have either attempted to change healthcare from the outside in or tried to force their solutions upon the many players and systems within the space or tried to make too much money with their own technology.
Companies must be able to plug into the massive, complex healthcare industry and work equally well if the consumer, employer health plan, commercial plan, or government is covering the bill.
Newer health tech entrants—who collectively received more than $40B in venture funding in 2021 alone to fuel their efforts have also struggled to make their mark. And while their approaches are different from the tech giants, the underlying reason for their lack of traction is the same: they are unwilling to deal with the complexity of the healthcare system on the whole.
There is infinite room to improve the consumer experience in healthcare—and build massive companies as a result. Unfortunately, there is no incentive for them to improve the experience as they are all making a lot of money, and most customers don’t have a choice because of employer-provided insurance.
I can’t help but go back to the “promise” of EHRs. To date, EHRs have become a complex mess. Patients still ask for medical records to be faxed to other doctors, and navigating some patient portals is very difficult.
For patients, almost nothing connects when it comes to EHRs. The place with lists of in-network doctors is different from the one for scheduling, is different from the one for benefits inform can’t different to the one for” payments” and is different from the one with outcome data, is content to the one with medical records, and so on. It is a simthey’redisjointed maze for providers and their staff. Their days are spent navigating antiquated, separate systems for scheduling, patient records, insurance approvals, and more.
The biggest company in the world will be a consumer health tech company. It just won’t be one of the biggest companies in the world today because they’re too big to solve this maze we call healthcare.