Has Medicine Reached the Digital Age? Five Key Obstacles Digital Technologies Still Need to Overcome

Digital health is the future. At least that is what many on Wall Street believe. In the first half of 2021, investments in digital health were $14.7 billion, more than all of 2020. Of the 372 deals completed in this time period, 48 of them represented investments of more than $100 million. Why all the excitement?

New digital technologies have the potential to greatly improve our health care system on multiple fronts. Telemedicine allowed many patients to communicate with their doctors during the COVID-19 pandemic; during the height of the pandemic, 30% of all visits were televisits. More broadly, digital technologies and sensors are now allowing more patients to receive care via a hospital at home.  For instance, OSF HealthCare in Illinois and Michigan unveiled a "digital hospital at home" model which combines in-person care and a digital command center that provides care coordination.  Digital therapeutics may even replace some of your pills. Akili Interactive’s EndeavorRx, for instance, is an FDA-approved video-game based app to treat patients with attention deficit hyperactivity disorder.

Despite this promise, many digital technologies will fail. In addition to the technical challenges of making the technology work, innovators face a number of obstacles including: (1) value demonstration; (2) regulatory hurdles; (3) provider reimbursement challenges; (4) integration into daily practice; and (5) data security, among others. 

Does digital provide value?

Digital health technologies must produce evidence that they provide value above and beyond not only analog alternatives but also other digital technologies.  Like any other innovation, digital technologies must show how they impact at least one leg of the triple-aim (ie, cost, care experience or health outcomes). Further, these technologies interventions must demonstrate how they provide good value for money.  For instance, the Institute for Clinical and Economic Review (ICER) last year evaluated the reSET-O digital technology—a prescription digital app that aims to improve outcomes for patients with opioid use disorder—and found that reSET-O was in fact largely cost-effective after incorporating traditional rebates.  

Not only must these technologies show that they are cost-effective in a controlled clinical trial setting, but they also must demonstrate that efficacy translates into real-world effectiveness.  Many individuals discontinue using digital technologies and thus clinical trial efficacy may not translate to the real world.  To address this issue, digital health companies should prioritize technologies that allow for passive data collection via sensors and should aim for clinical trial design to be more pragmatic in nature whenever possible.

Is there regulatory certainty?

Digital technologies present a number of new challenges for regulators. For instance, artificial intelligence (AI) algorithms may constantly self-update, which could present safety concerns that have yet to be addressed by any regulatory framework. For phone-based or tablet-based apps, insuring a robust digital architecture while phone operating systems continually update will be a challenge.  The Digital Health Center of Excellence (DHCE), based within FDA’s Center for Devices and Radiological Health (CDRH), will focus on mobile health devices, wearable medical devices, software as a medical device, and technologies used to study medical products. It appears that the DHCE will have some responsibility for oversight, but the formation of a specific regulatory path for digital products does not appear to be on the agenda. 

Will provider reimbursement need to change under digital?

Due to COVID-19, payers relaxed reimbursement restrictions for digital health interventions, but it is unclear whether these policies will continue.  For instance, Medicare added over 100 CPT and HCPCS codes to the telehealth services list for the duration of the COVID-19 public health emergency.  Telehealth visits billed to Medicare are paid at the same Medicare Fee-for-Service (FFS) rate as an in-person visit during the COVID-19 public health emergency. Medicare is covering a portion of telehealth codes permanently under the 2021 Physician Fee Schedule, but it is unclear how much of this largesse will continue.  Not all government entities are excited about telehealth; the Government Accountability Office (GAO) stated that continuing telehealth flexibilities enacted during the pandemic “has increased the risks of fraud, waste, and abuse”.

In the ambulatory care setting, the financial attractiveness of adopting new digital technologies often depends on how providers are compensated.  If health systems are at financial risk for population health outcomes or downstream health costs, it may be incentive compatible for these systems to increase adoption of new digital health technologies. Under traditional FFS, however, a provider’s return on investment may be negative. Although new remote monitoring technologies have the potential to improve quality of care, many of these technologies require physicians or other health care professionals to review the data for it to be useful.  It is not clear if payers are willing to provide additional reimbursement for FFS clinicians to review data outputs from digital health technologies even if it could improve care or reduce cost. An example is the Abilify MyCite technology which measures whether patients with serious mental illness take their medicine; however, these data are only useful if physicians are incentivized to take time to review them.

How well can digital health be integrated into daily practice?

Getting digital technologies integrated into routine care will also be a challenge. One study looking at the adoption of digital glucometers found that adoption initially was slow and key barriers were lack of coverage, provider reimbursement, and data management support, and patient heterogeneity.  While electronic health records (EHR) are becoming more ubiquitous, it is not clear whether the data produced by digital health technologies can be easily integrated into health system EHR systems.

There are a number of ways to better integrate digital health.  Educating providers on the use of digital health interventions with a strong evidence base is an important starting point.  Academic-industry partnerships to better understand how to translate digital health interventions into real world would also be helpful.  Finally, as health systems have grown in size over time, this scale could be leveraged to use big data to understand which clinicians are using digital health interventions appropriately and how those learnings could be shared with their peers.

Can innovators, providers and policymakers ensure that patient data is secure?

While the data from digital health technologies has the potential to improve outcomes, these data also would be highly valued by hackers and other nefarious parties. While decisionmakers recognize the importance of security patient data, how to achieve this goal is more complex.  The issue is multifaceted and requires network security, application security, information security, operational security, disaster recovery and end user training.

Digital health data includes not only data generated from patient interactions with health systems, but also self-generated patient data.  While HIPAA provides a framework for managing provider-created health data, HIPAA explicitly excludes health information created or managed by patients themselves. Social media platforms, wearable fitness trackers, and apps to manage pregnancy and mental health all collect health data that can be shared for advertising purposes and appended to medical records and other consumer information. 

Conclusion

While digital health technologies offer much promise, we must ensure that these technologies are not just “cool”, but also improve our health care system. Specifically, digital health technologies must: provide evidence that they increase value; meet regulatory requirements; ensure health systems are incentivized to and educated on how to adopt these technologies into daily practice; and robustly protect patient data.  While some digital technologies will struggle to meet these multi-faceted challenges, those that do should be quickly incorporated into our 21st century standard of care.

Disclosure: The views expressed herein are those of the author(s) and not necessarily the views of FTI Consulting, Inc., its management, its subsidiaries, its affiliates, or its other professionals.  FTI Consulting, Inc., including its subsidiaries and affiliates, is a consulting firm and is not a certified public accounting firm or a law firm.