You know how peeved you get when your phone can’t retrieve your calendar from the cloud? Imagine your frustration if, while in another city, you were admitted to a hospital with an electronic health-records system that’s incompatible with your doctor’s system back home.
Interoperability is essentially the capability of systems and devices to seamlessly exchange data. It’s the Gordian knot of health care that entrepreneurs and clinicians are striving to untie, to integrate services, devices and data across the continuum of care.
In a recent tekMountain post we scratched the surface of five major pain points in the medtech space that present great opportunities for entrepreneurs and innovators. Here we’ll take a closer look at one of those pain points, interoperability, and some potential opportunities.
In reality, interoperability in itself is more like a galaxy of pain points, far reaching in its variety, impact and complexity. The lack of interoperability, as illustrated in a report from the American Hospital Association, could manifest simply as numerical values in a lab report appearing in the wrong places. Or a specialist’s report written in English suddenly morphed into gibberish. It could be the inability to share details of a patient’s care with subsequent providers such as hospitals, skilled nursing facilities, inpatient rehab facilities, home health agencies and so on.
And technology is not always the major barrier to interoperability. The greater barrier is the need to incentivize innovation, particularly in two realms, health IT and devices.
As the Brookings Institution reports, despite the federal government having already spent over $27 billion in financial incentives to promote the adoption of modern IT systems among health care professionals, gaps remain. The AHA notes that while hospitals are proactively advancing information sharing, external barriers remain, such as uneven tech standards, high cost and the dearth of a highly skilled workforce. “The most prominent barriers are the lack of [electronic health records] among other care partners or compatibility between EHR systems,” says the AHA. Small, non-teaching and rural hospitals are especially slow in adopting EHR systems.
To spur innovation, the Centers for Medicare & Medicaid Services, or CMS (part of the U.S. Department of Health and Human Services), established the Medicare EHR Incentive Program. The program provides incentive payments for certain healthcare providers to use EHR technology in ways that can positively impact patient care. But there’s still a long way to go.
Opportunities in Health IT
VC funding. The Mercom Capital Group reported in April of this year that “Health IT VC funding increased 27 percent quarter over quarter, coming in at $1.4 billion in 146 deals compared to $1.1 billion in 145 deals in Q4 2015; it was also up 74 percent compared to the same quarter of last year.”
The first half of 2016 continues the trend. MorningStar reported in July that “venture capital funding in the Health IT sector, including private equity and corporate VC, came to $1.6 billion in 140 deals in Q2 2016 compared to $1.4 billion in 146 deals in Q1 2016; up 33 percent year over year. In the first half of 2016, close to $3 billion has been raised in 286 deals, a 50 percent increase compared to nearly $2 billion raised during the same period in 2015.”
Software. Software products and services are answering the call for interoperability, as with Signet Accel’s Avec™ platform, the “industry’s only purpose-built commercial federated data integration platform. SDSsoft is an EHR innovator that is among the leading earners of meaningful-use incentives. The EHR software space is crowded and dynamic.
Medical devices that collect information are nothing new. What is new is collecting and reporting meaningful data that improves patient care, precision of treatment, and information portability. Innovation is connecting the dots, for example, from medications to devices to data to medical records — essentially bridging connectivity between personal health technologies and EHRs.
According to West Health Institute’s 2013 report: “The Value of Medical Device Interoperability,”
- 90 percent of hospitals use six or more devices that could be integrated with EHRs.
- One-third of hospitals currently integrate medical devices with EHRs today.000
- Fewer than three types of devices on average are integrated in those hospitals investing in interoperability.
- 97 percent of an estimated $36 billion in potential waste is attributable to lack of interoperability.
The 2016 conference of the Healthcare Information and Management Systems Society (HIMSS16) last spring saw 133 new products debuted, 340 first-time exhibitors and 84 startup companies. How medical-device companies are using data was a major focus. Featured were a number of devices that are interoperable between hospitals’ EHR and other systems such as pharmacy, and which allow patients to self-monitor and share data with their providers remotely. Even augmented-reality smart glasses are being paired with patient-monitoring devices to yield heads-up displays. Fast Company’s list of the 10 most innovative health care companies include CVS Health for reinventing the pharmacy, Augmedix for putting Google Glass to medical use, and MC10 for devising temporary tattoos that function as medical sensors. You get the impression that the hunger for effective devices that provide meaningful data will not be sated any time soon.
Opportunities in Devices
The top-funded areas in Q1 2016, according to HIT Consultant:
- Wearables. One of the top funded areas in Q1 2016 were wearable devices and sensors with $260 million
- Data analytics companies with $197 million
- Telemedicine with $171 million. This includes innovative devices that promote virtual care and portable tools like the multipurpose MedWand, featuring Bluetooth connectivity.
- mHealth apps with $120 million
- Consumer health information/education with $100 million
Also hot: Internet-of-Things devices that patients may use for self-monitoring from home, such as the Dario Blood Glucose Management System comprising a pocket-sized glucose meter and mobile app to report results in real time. To patients, IoT promises convenience and control; to providers, it offers remote monitoring, faster response, less crowding at hospitals, and more time for doctors to spend with patients.
Connecting the dots to connected health is almost as challenging as an interboro commute on the New York City subway. It’s capital intensive and demands tight coordination, particularly where technical standards must be systematized. Discover opportunities that await you by speaking with the tekMountain team, who focus on education, health and medical technology.