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Deloitte's Life Sciences & Health Care Blog

Repeat after me: Inventions do not always lead to innovation

Teachers know this well: In order to internalize something—a fact, a figure, a concept—you likely have to be exposed to it over and over again. Oftentimes, it’s not until you’ve repeatedly seen, read, or heard something that you can truly understand or remember it.

This can even be true in health care. And in the case of innovation to support healthy aging, it may be especially true. As Joe Coughlin, director of the AgeLab at the Massachusetts Institute of Technology puts it, when it comes to tech-enabled solutions to aging, the problem is not a lack of transformative technologies. But, in his view, inventions do not always lead to innovation. Plenty of new technologies exist to bring solutions to aging issues. But, Coughlin says that these are often labeled as “novel” or “special,” rather than placing aging at the core of the innovative technology.1

You can see evidence of this virtually everywhere. Many software developers retrofit smartphone apps in an attempt to get a corner on the market. Other developers develop new technologies that target a small issue plaguing a niche area of the system, sometimes neglecting to see the larger issues at play. Moreover, few times are these technologies developed with a sense for how—or if—the reimbursement will ever come.

As results from the Deloitte Center for Health Solutions 2016 Survey of Health Care Consumers suggest, this issue has impacted health care consumers, too. Indeed, while 86 percent of the consumers we surveyed have gone online to shop and 72 percent have used mobile or online banking for personal finance, less than one-third of consumers are using most health technologies.

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Source: Deloitte 2016 Survey of US Health Care Consumers

However, there is one area in which our survey saw larger adoption of health technology: More than half (58 percent) of current prescription users report going online to refill their prescription.

This adoption rate is something that life sciences companies should consider tapping into. Medication adherence is a large driver of preventable readmissions, high costs, and complications in post-acute care. Technologies that tackle this issue may be able to bring to bear new solutions to an age-old problem, one that many older people are confronted with even more often. An earlier Deloitte study, Improving medication adherence: Tailored approaches may boost potential for success, suggested that medication adherence is related to consumers’ attitudes about the health care system, wellness, and engagement with digital tools.

The 2016 Survey of Health Care Consumers also suggests that caregivers are a key population. In fact, the caregiver market is projected to reach a sizable $72 billion in only four to five years. From 2016 to 2020, the cumulative total for the market is expected to reach $279 billion—nearly one-fourth of which is projected to be caregivers’ out-of-pocket spending.2 According to our survey, more consumers say they are likely to use sensor technology when caring for others than on themselves. And, caregivers are also more likely to use telemedicine and remote monitoring technology than are non-caregivers.

Connected homes that leverage the Internet of Things (IoT) are increasingly of interest to many consumers. IoT technologies could begin to transform how health care is delivered and alter hospital, health system, nursing home, and medical device company operating models. New technologies that enable providers to furnish more care outside of traditional health care settings could help lower costs and improve outcomes by keeping patients out of the hospital, lowering readmission rates, and promoting adherence to care plans.

New payment policies that help create the business case for achieving these outcomes could help support this vision. One potential step in that direction is the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA). A recent survey of health care executives showed that most medical technology respondents (five out of six) and most biopharmaceutical executives (six out of eight) believe that MACRA will cause hospital and health plan demand for value-based contracting arrangements from their company to increase.

These changes—innovative technology solutions for connected care supported by new payment arrangements—are unlikely to happen until the industry begins to change its thinking. Technology-enabled care to serve older adults and caregivers may not be just a “niche” market. Care inside the home—or outside of traditional settings—is likely the way of the future.

PS – We will be discussing these topics and more at AdvaMed 2016. Visit www.deloitte.com/us/advamed for more information.

1 Robert B. Hudson, Public Policy & Aging Report, “Aging and Technology: The Promise and the Paradox,” 2014
2 AARP, “Caregiving Innovation Frontiers,” January 2016

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Author bio

Greg leads the DTTL Global and US Life Sciences practices for Deloitte. In his role with Deloitte’s US member firm, he leads the life sciences sector practices for consulting, audit, tax, and financial advisory services. Greg has more than 25 years of experience helping clients in the life sciences, process manufacturing, consumer, and government sectors. In his role consulting to clients, his career has spanned such topics as technology strategy, integration solution development, and implementation of emerging and disruptive technology. Prior to his consulting career Greg held positions at a government research lab, where he led teams in the design and development of life support devices; and was a lecturer at the University of Pennsylvania.