Goldman Sachs: Digital Healthcare Could Save America $300B
Goldman Sachs has released a new report that projects first-wave digital healthcare products and innovations could cut U.S. healthcare spending by $300 billion by moving patient care away from the hospital and into the home. Analysts remarked that many physicians, hospitals, and payors with whom they spoke seemed to be on board with the shift toward digital.
Business Insider reported that Americans far outspend other developed economies for healthcare, spending 18 percent of their GDP each year on health-related costs. Several Affordable Care Act (ACA) provisions are working to curb the spending, but cuts made possible by digital healthcare could be much more comprehensive, stated the Goldman Sachs report.
According to a recent report from Tractica, the number of patients using home health technologies will jump to 78 million by 2020, more than five times the estimated 14.3 million people who used home health technologies in 2014. While hospitals and doctors’ offices aren’t likely to disappear, Goldman Sachs predicts that patient care will shift to the home as much as is technologically feasible.
The three main areas where the internet of things (IoT) could reduce spending, said the report, are telemedicine, behavior modification, and chronic illness management.
Chronic illnesses like cardiovascular disease, asthma, and diabetes represent one-third of all U.S. healthcare costs and, by allowing doctors to monitor “high-risk” patients remotely, the U.S. can cut a lot of redundant and needless healthcare spending — nearly $200 billion worth — said Goldman Sachs.
“These disease states also represent the most fertile ground for digital health since data and modification of treatment paradigms have demonstrated improved patient outcomes, lower adverse events, and reduced costs,” said Goldman Sachs analysts.
Telemedicine, which allows doctors to see even new patients remotely, is another potential money-saving solution offered by digital innovations. Traditional urgent care requires patients to visit a hospital or care facility and wait to be seen, but new mobile apps could bring doctors into those patients’ living rooms.
The Cleveland Clinic recently launched a 24-hour online service for Ohio-based patients, called MyCare, that will coordinate virtual visits between patients requiring urgent care and Cleveland Clinic doctors, all for a fraction of what a normal ER visit would cost.
The Goldman Sachs analysts observed that major hospital networks, like the Cleveland Clinic, already are integrating technology into their standards of care. The analysts were surprised by how much of the industry —physicians, payors, and the start-up community —already is embracing digital healthcare options.
“These findings gave us confidence that digital health technology carries merit and is starting to find a place in larger systems, which could percolate throughout the system in the future,” they reported.
While more hospitals are jumping into the digital game and a new start-up pops up every day, some experts are concerned that important issues surrounding digital safety and privacy have not yet been appropriately addressed.
A recent article in IEEE Spectrum reported that today’s IoT is rife with security flaws, and advised that more cyber-security experts need to join forces with health-care developers to make sure patients are kept safe from potential hackers.
Researchers from the Mayo Clinic, addressing concerns about artificial pancreas technology, commented in an article that wireless medical device security quickly is emerging as a regulatory issue.