Breaking Down Mobile Health
From consumer wellness applications aimed at preventing minor, every-day issues from escalating into serious, life-threatening problems, to remote health monitoring services that allow health professionals to manage chronic diseases, Mobile Health (mHealth) is increasingly playing a role in improving health outcomes and services. Consumer wearables, applications and services are helping consumers to manage and improve their own personal health and well-being. mHealth technology is going a step further to help clinical professionals limit “repeat admissions,” for which many governments fine hospitals in light of rising healthcare costs. And it will play an increasingly important role in improving the health of aging populations, or the greying of developed nations, where there is an increasing demand for in-home monitoring and elderly care, which comprises the largest block of monitoring services.
In all of these instances, the benefit of mHealth offerings can be exponentially greater if medical clinicians can make use of the wealth of innovative and useful data and outputs coming from consumer-based mHealth solutions. It stands to reason that the faster medicine as an industry can understand and synthesize data and outputs from the individual, the greater the potential to catalyze more value for all.
Nomenclature: mHealth Market Definitions
For the sake of this article and comparing solutions, we make the distinction between Wellness and Clinical Healthcare. For the healthy person, personal wellness products are smartphones, apps and smart wearables. For those with chronic conditions, there is a myriad of connected devices at home that measure environmental factors, weight, menstrual cycles, medication adherence, and devices that are passively, quietly and continuously measuring vital signs just as a team of clinicians would be listening to the patient in a hospital.
Global Adoption of mHealth
As awareness increased among consumers, personal wellness data became more understandable, which is now key in driving adoption by the patient/consumer. But not long ago, many of the products “well” people used to track themselves were a novelty since the data and outputs from these apps were siloed in the device or app itself. The data was not available to other apps or on other devices. Furthermore, healthcare providers were unable or unwilling to access and use that information, due to things like skepticism over accuracy, or regulatory concerns. But when personal wellness data started to become more accessible through cloud services and standardisation, adoption and use of this data among clinical healthcare professionals has started to grow.
In a study conducted by the Journal of Medical Internet Research, a larger quantity of consumers are favourable to using mHealth as a complement to in-person doctor visits (758/1132, 66.96%) than as a substitute. The study also found that those who were more favourable toward using mHealth as a substitute for in-person doctor visits than as a complement indicated stronger intentions to use mHealth.
It stands to reason that if both constituencies (Wellness and Clinical) work together to bridge the gap between patients and professionals, adoption will be driven from both sides.
As the incentive for healthcare delivery moved away from fee-for-service to rewarding improved outcomes, healthcare providers will increasingly consider Wellness products and data as supplemental to their profession.
Exploring Common mHealth Business Models
Consumer Focus: The "Freemium" Model
Start with freemium models to develop a user base and shift to long-term licenses for recurring revenue.
What a Freemium model tries to accomplish in the mHealth space is similar to that in the early Internet models that are based on the “freemium” concept. The company would offer an app for free, in an effort to create the necessary viral momentum to grow a user base and/or partnerships. Meanwhile the company refines the app, identifies what works and what doesn’t and offers enhancements and upgrades for fees. Once that tipping point of users is reached, advertisers are likely to want to pay to appear in the picture. Big pharmaceutical companies are particularly interested in advertising to target prospective patients, at low cost, with medical problems addressed by their drugs and/or supplements. At a later stage the company adopting freemium models can offer different levels of service, including one ad free level for which the customer pays a fee.
Licensure: The Subscription Model
Many new mobile health apps on the Wellness side are addressing care coordination between and among healthcare providers. These types of apps allow its users (both individuals and their healthcare providers) to input the patient’s personal medical data and store it in a way such that the patient’s healthcare information is integrated, resulting in more coordinated clinical decision making. Many coordination platforms, such as HER (Electronic Health Records) platforms, are adopting freemium models, where physicians can test it for free. But once physicians enroll a certain number of patients, the platform turns from fermium to subscription. Many platform developers opt for a subscription product from the onset, given that fermium has not been the favored approach with many other digital health products. Those companies with mobile health apps that coordinate with existing legacy healthcare IT products have focused more conventional subscription agreements. Subscription agreements have been the conventional approach, where the IT companies transfer the rights to the software for a period in exchange for a use fee. Subscription model can be paid for by a) an individual (affordable premium grade apps) or b) a third party (insurance companies subsidizing / reimbursing more expensive consumables along with their apps) which we discuss in more detail.
Third parties: The Health Insurance Model
Health insurance reimbursement is starting to emerge as a supplemental revenue generation opportunity, instead of revenue stemming from just patients and healthcare providers. Some mobile health apps performing diagnostic tests, that would otherwise be performed by traditional devices, already qualify for reimbursement under health insurance plans. A number of recent mobile health applications provide therapeutic services for diabetes, depression, cardiovascular disease and other diseases. Given the high costs of marketing to physicians and regulation resulting in prolonged time to market, this model is more risky but generates higher revenue per use than fermium and subscription models.
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