What do you mean by digital health?

What do you mean by digital health?

What do you mean by digital health?

Insurance Strategy: From Digital Health to Digital Therapeutics

In this article, The Digital Insurer’s Andrew Dart discusses the emergence of digital therapeutics. He demonstrates how a disease-specific focus and emphasis on clinically validated results can deliver strong returns on investment for insurers. He argues that while healthcare regulators and Big Pharma have lagged behind the trend, insurers are late. He believes this is due to the overwhelming noise generated by their own digital health initiatives and their inability to see the difference between Wellness Apps and Digital Therapeutic Apps.

Since the early 2010s, there has been a trend of life and health insurers in Asia introducing health and fitness, lifestyle, rewards programs. One of the first in Asia was Great Eastern Life Insurance , which launched its “Live Great” health rewards program in Singapore in 2012. After AIA launched in 2013, the company launched its Vitality Wellness Rewards Program in Singapore, which has expanded to other parts of Asia in the years since. This comes against the backdrop of the rise of quantified self sports and fitness tracker wearables, with the much- launch of the Apple Watch in early 2015.

From payer to partner

For these insurance first movers, the basic imperative is to transform their relationship with customers. Back then, life insurance was a one-and-done affair, with the only regular connection being the annual statement. These wellness programs work to appeal to clients who touch their lives on a daily or weekly basis. Plus, the health and fitness angle aims to reduce claims and prolong life. Indeed, Vitality plans tout some impressive statistics on these measures and improved retention rates as one of the best “science-based” plans available to insurers.

Many insurers now view wellness as an important part of their customer engagement strategies. Probably the most famous of these latecomers is AXA. They launched their “Pay Partners” strategy in 2016, which is broader than pure healthcare. Their goal is to transition the business to this new customer-centric model by 2020.

Missed the mark?

The downside of most of these programs is that chronic conditions are largely ignored. These programs are designed to appeal to a wide range of people and do not provide the specialist intervention and support needed to cope with a chronic condition.

Today, the rise of chronic diseases is considered a global epidemic . Risk factors for chronic disease include smoking, physical inactivity, heavy alcohol consumption and obesity. These are behavior-driven, which is why these are often referred to as lifestyle diseases. Globally, chronic diseases such as diabetes, cardiovascular disease, chronic obstructive pulmonary disease and cancer contribute more than 60% of mortality and are expected to rise to over 70% by 2020.

The situation is so alarming that many governments around the world are adopting new public health policies such as a ” sugar sweetened drink tax” to stem this trend.

Widening health protection gaps

In Singapore, the government announced “Fight Diabetes” in 2016. A year later, the government launched a multifaceted community plan to tackle the chronic condition.

Figure 1 – Singapore’s War on Diabetes Source: https://bit.ly/2saxtg1

This shows how seriously the Singapore government takes this situation and highlights why the industry needs to evolve and develop products that meet this growing demand within the community.

Recent events have further emphasized this point. According to a study, , published by Swiss Re. It describes a healthcare protection gap of more than $1.8 trillion across Asia. The report states that nearly 50 percent of the gap is caused by chronic diseases, with the top three being high blood pressure, diabetes and high cholesterol. Interestingly, Swiss Re found that 3% of Asian households with chronic diseases were more likely to buy insurance. Their takeaway is that insurance products that focus on lifestyle-related chronic conditions will meet real needs in Asia. Additionally, they advocate for the use of data and technology to help reduce chronic disease risk, thereby increasing the profitability of existing titles and opening up new customer segments that were previously difficult to reach.

A New Approach: Digital Therapeutics

In the past 18 months, a new application targeting the field of chronic disease management has emerged. Collectively known as “digital therapeutics,” the apps target a range of conditions, including mental health, opioid addiction and diabetes, among others. Unlike wellness, health and fitness apps before them, digital therapy apps have clinical evidence proving their effectiveness in addressing disease and delivering positive outcomes for all stakeholders.

In many jurisdictions, these applications are based on standards applicable to medical devices or pharmaceuticals, subject to new and evolving standards. In 2017, the U.S. Food and Drug Administration (FDA) introduced its Digital Health Precertification Program to accelerate innovation in digital health technologies. The first certified Digital Therapeutics Apps have recently launched, including Reboot , and more apps are on the way. In the UK, the NHS is moving in a similar direction.

In Asia, we are not behind in this game. In 2017, Healthy Therapeutics became the first in South Asia to be prescribed by a doctor. This is only due to a series of published clinical studies proving its utility in fighting the disease.

Digital therapeutics emerge from the health wilderness

Large pharmaceutical companies such as Novartis and Merck have been quick to spot this trend . They are busy partnering with and investing in HealthTechs working on the development of digital therapeutics.

However, insurers are still on the sidelines.

McKinsey argues that digital therapy apps have been held back from mainstream adoption as there are already more than 300,000 commercial health and wellness apps in the market. This is one reason insurers have been slow to move in this area. Many insurance companies already offer companion apps to their health plans. Why another app?

So, what’s the difference?

Digital therapeutics are an alternative proposition to traditional health apps. First, they are too personal. They want to understand users’ habits and preferences and use them to make small but critical behavioral changes over time. And Wellness Apps advocates fairly general changes that may be difficult for users to implement. Second, digital therapeutics often combine AI and human guidance for active intervention (very addictive). Apps such as Wellthy claim that more than 70% of their users use the app every week. The ability to chat “with the moment” can change behavior instantly. For myself, the ability to take a photo of the nutrition label from my favorite whole grain bread and share it with my trainer for immediate feedback is awesome.

Clearly, therapeutics focus on specific diseases and comorbidities (associated diseases) that make each user unique. They help monitor readings (blood sugar, etc.) and are very sticky to follow up. For those with type 2 diabetes, for example, this is critical to changing behaviors that have been ingrained for 40 years or more. And, these apps can save lives by providing proactive alerts when readings fall significantly outside expected ranges.

With most Wellness Apps, users are almost entirely on their own. In contrast, Digital Therapeutics Apps can identify a user’s personal support network – from home caregivers to their chosen healthcare professionals – and establish appropriate data sharing and analysis to optimize their positive impact on the user. For HCPs in particular, data from physiotherapy apps can help fill in the gaps that patients have been doing between visits and allow for more meaningful consultations with patients.

It’s all in clinical results

In the end, it all comes down to results. Results for users and stakeholders. The ability to demonstrate clinically meaningful outcomes is what qualifies an App as a therapist.

In this regard, we have seen impressive development of many applications in Asia. The results research published by professional bodies such as American Diabetes Association and American Association of Clinical Endocrinology have played an important role in the fight against diabetes and gained industry recognition. The results of these studies show that at a population level, only 20 weeks reduced the risk of diabetic complications by more than 16%. For insurance companies, this means avoiding claims worth thousands of dollars per patient per year. For patients, the results can be life -changing in terms of improving quality of life.

the bottom line

For insurers not already committed to health and wellness/lifestyle trends, Digital Therapeutics presents an opportunity to quickly and profitably address a customer base within their existing portfolio. This could be in the area of ​​individual or group or employee benefits, where a general rise in chronic illness will be a drag on profitability as formerly healthy members develop chronic illness. Additionally, Digital Therapeutics could enable nimble insurers to open up entirely new market segments with disability-focused products and ancillary programs that offer real differentiation from the rest of the market.

For insurers who already have health and wellness plans, digital therapeutics represent a logical next step to enhance and broaden the appeal of their plans. But, they better be quick!

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