Patient Digital Health Platforms…A First Take

apple
This post was originally published on the HIMSS blog with the title “Patient Digital Health Platforms (PDHPs): An Epicenter of Healthcare Transformation?”

Apple’s recent announcement about its HealthKit platform is a beacon of a much bigger trend. We are at the early stages in the rise of a new business and IT ecosystem:

Patient Digital Health Platforms (PDHPs)

These new platforms should be high on the radar screens of healthcare providers. While v1.0 of PDHPs is starting fairly narrow, companies will be highly incentivized to move up the food chain into mainstream health data exchange, workflow integration, and virtual care delivery. PDHPs portend both opportunities and threats.

I’ll pose and provide some early answers to how the PDHP ecosystem might shape up. Here’s a preview:

  • What’s “The Healthcare Platform Void”?
  • Who Are Initial Players in the PDHP Ecosystem?
  • A Central Question: Will PDHPs Go Narrow or Broad?
  • What Market Pressures Incentivize PDHPs to Go Broad?
  • What Are Early Warning Signs that Some PDHPs Will Go Broad?
  • How Long Will It Take For All This to Play Out?

Consider this an introduction to PDHPs—you will discover more questions than answers. I’ll use Apple HealthKit as a case study to illustrate some examples.

What’s “The Healthcare Platform Void”?

Compare today’s smartphone OS market with today’s healthcare market.

Think of the smartphone ecosystem as consisting of a few dominant platforms (Google Android & Apple iOS), each having around 1million plug-and-play apps; these two platforms have grown from 0% market share in 2006 to over 90% in 2013. Apps greatly extend the functionality of the smartphone platforms — innovation at the edge of the network. The platforms and apps form a vibrant ecosystem.

Then, think of today’s health IT market as thousands of apps with no widely-adopted platforms to glue together their data and functionality. While startups and VC funding are at record levels, it’s challenging to diffuse innovations into mainstream healthcare. Patients and clinicians experience fragmentation and chaos. This is The Healthcare Platform Void.

Who Are Initial Players in the PDHP Ecosystem?

Some companies are making significant platform plays:

While others suggest they will prefer to be participants in the ecosystem:

This list is illustrative, not exhaustive; anticipate new entrants. Several of these companies made announcements even as the writing of this post was in progress.

At this point it’s not clear which of these players will become more extensive platforms or which will develop apps and/or infrastructure in the ecosystem.

The commonalities: these all are gorilla consumer tech companies that bring capital, brand, trust, scale and scope across many industries. They understand that consumer value and company valuations are driven by platforms and ecosystems that can draw in consumers and developers. They understand the importance of creating critical mass and network effects.

A Central Question: Will PDHPs Go Narrow or Broad?

Some analysts have been painting fairly narrow pictures of the scope of these new platforms, often describing them as consumer “wearable” or “fitness” technologies.

How should healthcare providers view these new digital health platforms? as narrow or broad?

Narrow: Consumer Wearable/Fitness Platforms. Niche entrants into markets that are distantly adjacent to healthcare delivery.

Scope: Fitness, wellness, wearables. Healthcare applications are incidental, not central.
Data: sensor and consumer generated data
Target audience: consumers, especially those interested in health, wellness, quantified self

or

Broad: Patient Digital Health Platforms. iTunes forHealthcare. Centralized patient access to healthcare data, workflow, knowledge.

Scope: Initial versions create a beachhead into consumer fitness/wearables. Future versions are incrementally expandable into healthcare data exchange, workflow and delivery.
Data: Today—sensors, patient generated data. Tomorrow: 2-way data exchange with EHRs and all other medical data & digital data sources.
Target audiences: initially consumers, but potentially all patients, physicians, vendors & other health care stakeholders

The simple but keen insight recognized by Apple at their Worldwide Developers Conference is the value of sharing patient information across apps.

What Market Pressures Will Incentivize PDHPs to Go Broad?

My read is that over time market pressures will incentivize PDHPs to go broad. Why?

1) That’s where the value is. Willie Sutton robbed banks because “That’s where the money is.” Who amongst us hasn’t seen a dozen articles in the past six months touting tremendous promised value of data and analytics in healthcare? Do you think that creating and capturing this value will be limited to industry incumbents–not new, digital disruptors?

The central question for Apple to figure out is whether they can become a dominant healthcare data aggregator, or will they default to becoming just one more silo.

2) Many healthcare value propositions will be dependent on broad networks and platforms. If you had high blood pressure and needed to manage your own care with support from your physician, what good would it be if your lab values were on one platform and your medications were listed on another, non-interoperable platform? If you were traveling and went to a hospital emergency room, what good would it do you if your health data was stored on a network not accessible by the hospital?

3) The Need to Drive Company Valuation. Tech companies and investors are always asking “What’s the Next-Big-Thing?” to drive growth and financial valuations?

Fitness/wellness is small potatoes to consumer tech companies. Apple needs to create a critical mass of consumers and developers to sustain a viable PDHP. Is there is enough value in fitness app data alone? Are there enough consumers who are interested and will sustain use of fitness apps? I doubt it.

Why did WhatsApp command a valuation of $19 billion (NOT a typo) when it was recently acquired by Facebook? It had created a user network approaching 500 million consumers, supported by strong network effects and high switching costs.

4) The Need for Differentiation. A narrow PDHP ecosystem could become crowded very quickly. Platforms could soon start to look very much alike and become undifferentiated — an indistinguishable plethora of watches, glasses, and gizmos.

In contrast, healthcare data will be unique to individual patients. This minimizes risks of commoditization and creates potential for virtually limitless differentiation.

What Are Early Warning Signs that Some PDHPs Will Go Broad?

Let’s consider some of what we’ve learned about Apple so far:

For months, the trade press has been reporting of many new hires joining on Apple’s health platform. All have extensive industry credentials, many with MD or PhD degrees.

While short on details, Apple’s June announcement noted they are “working with” with Epic and Mayo Clinic. One of their slides showed an extensive list of healthcare delivery systems.

apple

In a FOIA summary of a meeting between Apple and the FDA, Apple described itself as having a “moral obligation to do more” in healthcare. Does this sound like a company that’s treading carefully NOT to cross boundaries or to enter the mainstream healthcare market space?

At this early stage, there’s more that is unknown than is known about the PDHP ecosystem. How can we discern that PDHPs are becoming “broader”? Here are some key signals to watch for:

• Data exchange from PDHPs to EHRs. For example, Apple and Mayo Clinic have announced that HealthKit will feed data into Mayo’s EHR starting in Fall, 2014
• Data exchange to PDHPs from EHRs
• PDHPs incorporating new functionalities, e.g.,

• Patient portals
• Personal health records
• Telehealth/telemedicine capabilities
• Patient education tools
• Medication management capabilities
• Shared decision making tools
• mHealth apps
• …and many others

• Cross-platform sharing of data? Collaborations across PDHPs?
• Integration of FDA approved devices
• Adoption of health IT standards, e.g., Direct, FHIR, BlueButton, CCDA, etc.
• Partnerships/acquisitions with healthcare vendors
• Partnerships with health care systems and physician groups
• Partnerships with broader community based healthcare providers — home health, behavioral health, long-term care, etc.
• Physician and other clinicians use of PDHP data and capabilities? Will they be enamored or annoyed?
• Integrations between PDHPs and other strategic initiatives, e.g., how will Apple HealthKit interact with Apple’s newly announced smart home initiative, HomeKit?
• Platform positioning within the PDHP ecosystem. Broader platforms are more likely to position themselves as neutral collaborators with other PDHP platforms than as direct competitors.

How Long Will It Take For All This to Play Out?

Years.

Stay tuned.