IBM, GE, Microsoft aim to transform ailing health-care industry
The health-care industry, suffering from rising costs, is undergoing a major change from a fee-based to a value-based model. Predictive analytics is being used to support these changes. Additionally, patients that frequently access various data on their mobile devices are demanding access to their health-care information as well. These developments are creating growth opportunities for tech companies. However, a lack of interoperability, privacy and security concerns remain main growth impediments.
Value-based health-care model puts greater focus on technology
Government agencies around the world are changing the health-care reimbursement system from a fee-for-service to a value-based-care model with the objective of reducing rising costs. Under this model, reimbursements will be made based on outcomes and on the quality of care — not on the number of procedures and tests done on a patient. This change is forcing the industry to look at various technologies to better understand their cost structure and provide new methods of patient treatment.
Consumerization of health care driving mobile, cloud investments
Higher premiums and co-payments are increasingly becoming the patients’ financial responsibility, raising their involvement in the health-care system. Patients are demanding greater access to their health information on mobile devices, similar to the accessibility of data in other segments such as financial services and retail. This is forcing health-care companies to adopt emerging technologies such as mobile and the cloud, which in turn drives growth opportunities for IT services providers.
GE’s install and customer base aids in health-care IT race
As traditional software companies develop health-care IT products, General Electric’s large install base, long-time customer relationships and domain expertise, as well as its Predix open software platform, are major advantages. GE expects its $1.5 billion health-care IT unit to grow over 20% in 2016-18. The launch of GE Health Cloud in November will deploy analytics and optimization tools across clinical, financial and operational applications. GE expects 80% of applications to come from third-party developers.
Fitbit, Apple push next wave of health-care IT development
Wearables are becoming an important emerging technology in health care, as patients are increasingly monitoring their fitness and vital signs through sensor-based applications. This is gradually becoming a way for care providers to reduce costs. A drop in the cost of sensors and data storage is a major factor in the rising adoption of this technology. Wearables are also becoming a significant part of population health management, which is used by global corporations to increase health awareness among its employees.
IBM-Medtronic like partnerships may grow with Internet of Things
Rising demand for remote health monitoring may increase partnerships between medical device and tech companies. An IBM-Medtronic partnership to manage diabetes using Watson’s platform and Medtronic’s glucose monitors can detect hypoglycemic cases three hours ahead of an attack, potentially saving lives. As medical devices become more connected, tech companies will be able to use sensor data to create personalized treatment plans. The IBM-Medtronic partnership was announced in April 2015.
APRIL 11, 2016
This analysis is by Bloomberg Intelligence analysts Anurag Rana, Caitlin Noselli, Jason McGorman, Karen Ubelhart and Elizabeth Krutoholow. It appeared first on the Bloomberg Terminal.