Why Digital Health Has Billions and Billions of Opportunities

Remote patient monitoring of chronic conditions alone could save U.S. healthcare more than $200 billion, Goldman Sachs reports.

Nancy Crotti

Digital healthcare can revolutionize chronic disease management and save the country a bundle of money, according to a report released this week by Goldman Sachs.

Chronic conditions account for $1.1 trillion per year, or one-third of total U.S. annual healthcare expenditures, the report says, according to a National Medical Expenditures Panel Survey data cited in the report. Heart failure, asthma, and chronic obstructive pulmonary disease, and diabetes account for 20% of that figure, and represent the "most fertile ground for digital health," the company said.

Goldman predicted a "total savings opportunity" of about $305 billion--more than $200 billion from remote patient monitoring of these conditions alone. Data and modification of treatment models have demonstrated improved patient outcomes, fewer adverse events, and reduced costs, the study says.

The report predicts a commercial opportunity of roughly $15 billion for remote patient monitoring, $12 billion for telehealth, and $6 billion for behavior modification.

Medtech and IT companies are paving the way for this predicted revolution, regularly rolling out devices and announcing partnerships to enable remote patient monitoring.

Medtronic introduced a remote glucose monitor with an integrated insulin pump in 2012. AliveCor won a patent for a smartphone-enabled EKG system the following year. Boston Scientific's Latitude system remotely monitors heart rate, respiration, physical activity, and arrhythmia.

Goldman reports "general willingness" to embrace digital health. "In fact, we came across a number of large integrated delivery networks ... using remote monitoring and telemedicine to drive patient compliance, monitor developing conditions, and adjust treatment paradigms," the report says. "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."

But Goldman Sachs also expressed concern over how quickly remote health monitoring would catch on across the country. Part of the problem is the sheer volume of wireless devices used in public as well as in people's homes. On top of that, wireless technology is changing at such a rapid clip, it becomes difficult for medical device developers to rely on a given wireless protocol for the long term.

Monitoring patients in their homes could help doctors keep tabs on patients and prevent those recently released from hospitals from being readmitted. The ultimate promise of wireless technology is that it could be used to keep patients healthy enough that they don't have to go to the hospital in the first place.

Goldman Sachs acknowledged that limited adoption of wireless health-monitoring devices has left "the current profit pool ... insignificant," the report says, "however, advancements in technology and sweeping changes to the U.S. healthcare operating environment make us confident in the path to adoption and future revenues."

Nancy Crotti is a contributor to Qmed and MPMN.

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