Opportunities of Globalization and New Business Model for Mobile Technology in Healtcare

Introduction

Despite the tremendous advances in medial research and technology there are still a number of factors like social and geographical barriers that prevent the exploitation of full potential in various health care industries and segments.

For example in tracking and stopping disease outbreaks we still heavily relies on epidemiologists painstakingly back tracking patients to identify the source of an outbreak. Just like Dr. Snow in 19th century London who for his work is seen as the "faster of epidemiology".

Health Statistics (OECD, 2013) shows that the annual average growth rate per capita for health expenditures continue to grow steadily. People started to care about their health more than before and also for the next generation.

Healthcare practitioners, for better judgment, have to rely on medical devices to capture more data, wireless communication technology allows data to be transmitted through network between different end users across the globe. What will be the business opportunities when mobile technology meets healthcare? We attempt to go through the four sub-sectors of mHealth industry and mainly focus on the impact on business model.

M Health (source: http://mhealthwatch.com/infographic-mobile-healthcare-faces-the-future-19218/)



The Opportunities of Globalization

PublicHealth

Infectious disease tracking is essential for the outbreak to be contained. Public health authorities and WHO are responsible for tracking diseases. Therefore, even though it is not an industry in itself, it is vital to the public.    

Public health (source:https://www.youtube.com/watch?v=oy1CAMObRzc)

With the increase in mobility, outbreaks are no longer confined to a city and its neighborhood (like in the 19th century). Within 24 hours any infected patient can fly to any place in the world. As more and more people are carrying smartphones it is possible to trace their movements, where they have been, who they have contact with very easily. This speeds up the process of epidemiological tracking considerably, stopping the wider spreading of diseases and potentially     saves lives. Mobile technology can also help doctors treating infected patients by capturing information about the status, treatment, etc. and immediately shared it with experts that might be thousands of kilometers away that are helping in coordinating an effective response (WHO n.d.).

MedicalEquipment

Medical Devices (source:http://www.bizreinvention.com/2013/05/24/

doctors-in-your-palm-will-mobile-health-care-help-reduce-medical-bills/)

Medical equipment is designed to aid in the diagnosis, monitoring or treatment of medical conditions. Globalization has greatly increased the demand for medical technology. The globalization of design, sourcing, manufacturing, distribution, and sales of medical technology has accelerated the transformation of the Med-Tech industry; the emergence of new economies as key marketplaces for the sale of medical devices has forced executives to pause as they consider how to serve these markets as well as the developed economies that have long been the principal revenue drivers for their companies. Moreover, these concerns are emerging just as the industry’s business model shifts from “selling products” to “providing integrated solutions” that improve care and enhance health across population.



MedicalNetwork

Net Work (source: http://acolyst.com/wp-content/uploads/2011/04/)

A mobile phone in the hands of an individual is an extension of the wireless communication network. Companies within the sector put emphasis on (in general) maximizing the efficiency and effectiveness of healthcare organization. Specifically, the links between healthcare practitioners and patients and caregivers are enhanced. Not many of the companies within the sector who would like to go global can benefit from globalization. The provision of service is limited by infrastructure maturity of regions. It is also limited by regulations on data privacy protection. Therefore, social network service providers operate principally within North America. However, companies can locate their research center to places where qualified personnel are available and the costs cheaper.

MedicalResearch





 Research Data (source: http://pathfindersoftware.com/medical/)

Medical research needs tremendous amount information to study and the medical research are very often bounded by the geography. The traditional way of gathering volunteer and data is defined as time-consuming, high cost and limited information, while mobile medical research overcomes these shortages with real-time, digital, high-frequency data support. Under globalization, with easy access and contribution for the study, researchers could get frequent data from worldwide in high diversity and large population, which help to lead to more accurate results. While there are some challenges as well. The regulations vary from region to region, the data input precision are different. Private information protection is also an important determinant of the success under globalization

New Business Models

In a globalized world, new cooperation model between the various nations, new ways to define and fund technological standards to be able to compare and share mobile data need to be defined, agreed and implemented. Such standards would have to then flow into the manufacturing process of any mobile services to be able to gather and analyze the data.

Co-work   (source:https: //organizationsandmarkets.com

/2014/01/29/the-soft-underbelly-of-business-model-innovation/)

Capitalizing on newly emerged technologies, the business models of healthcare research, healthcare social network, and medical devices/supplies have brought us changes in the way revenues are generated. Generally speaking, companies have increased customer base, expanded channels/platforms, enhanced efficiency and decreased costs. Due to changes brought about by technology, markets become highly segmented, companies within the sector can better assess and predict the needs of customers. As a result, companies can serve customers better.

List of References

Medical Technology Industry Faces a Balancing Act in Globalization, By Manufacturing Geek on November 29, 2012 http://manufacturing-geek.com/medical-devices/2012/11/medical-technology-industry-faces-balancing-act-globalization/

Athena Health company website http://www.athenahealth.com/ retrieved on 19th of April, 2015.

Mechael, Patricia; Kwan, Ada; and Kern, Dayle. Chapter 9: Mobile Health. in Global Mobile: Applications and Innovations for Worldwide Mobile Ecosystem. by Bruck, Peter A. & Rao, M. (eds.) New Jersey: USA, Information Today, Inc.

Motion Computing company website https://www.motioncomputing.com/ retrieved on 19th of April, 2015.

CDC (n. d.). 2014 Ebola Outbreak in West Africa. Retrieved on 23 April 2015 from http://www.cdc.gov/vhf/ebola/outbreaks/2014-west-africa/

Rojahn, S. J. (2012). Pakistan Uses Smartphone Data to Head Off Dengue Outbreak. Retrieved on 22 April 2015 from http://www.technologyreview.com/news/506276/pakistan-uses-smartphone-data-to-head-off-dengue-outbreak/

WHO (n. d.). Global Alert and Response (GAR). Retrieved on 22 April 2015 from http://www.who.int/csr/en/

Wikipedia (n. d.), Timeline of the SARS outbreak, Retrieved 23 April 2015 from http://en.wikipedia.org/wiki/Timeline_of_the_SARS_outbreak

Willingham, E. & Helft, L. (2014). Tracking Disease Outbreaks. Retrieved on 22 April 2015 from http://www.pbs.org/wgbh/nova/body/disease-outbreaks.html

 

When Mobile Technology meets Health Industry – A marriage made in heaven?

Introduction – Health Crisis Looming?

Macro and socio economical forces are driving the expenditures per capita steadily higher and higher and are shaping the health industry. OECD Health Statistics for 2013 (OECD, 2013) show that the annual average growth rate per capita for health expenditures has come down on average (OECD, 2013; see Figure 1) but is still growing.

Figure 1: Annual average growth rate in per capita health expenditures (OECD, 2013, p. 155)

The OECD average for health expenditure per capita and year is over 3'000 USD (OECD, 2013; see Figure 2).

Figure 2: Health expenditure per capita, 2011 (OECD, 2013, p. 155)

Advances in medicine have increased the life expectancy over that last 40 years by ten years on average (OECD, 2013; see Figure 3).

Figure 3: Life expectancy at birth, 1970 and 2011 (OECD, 2013, p. 25)

As more deceases can be treated or even cured, modern time lifestyle deceases like obesity are increasing health expenditures steadily and continuously (Bouysen, 2010, see Figure 4).

Figure 4: The Casual Loop of Rising Health Costs (Bouysen, 2010)

As a result the health spending per capita is increasing not linearly but exponentially as the life expectancy increases (OECD, 2013; see Figure 5).

Figure 5: Life expectancy at birth and health spending per capita, 2011 (OECD, 2013, p. 25)

This increased demand is not met with increased supply of medical personal. As OECD statistics show (OECD, 2013) the number of practicing nurses per population has been decreasing in the first decade of this millennium by more than 1.5% on average (see Figure 6).

Figure 6: Practicing nurses per 1'000 population, 2011 and change 2000 and 2011 (OECD, 2013, p. 77)

All these factors are not only increasing the health costs but if not addressed can result in a health system that is very expensive and has not enough capacity to take care of all the people needing medical help. A health crisis is the making.

How can technology - especially mobile technology - help in avoiding this looming future for patients needing medical help and health care services? This article will provide some of these answers.

The Impact of Mobile Technology on Health Care

To understand mobile health industry, we first need to understand what is meant by 'mobile health'. According to World Health Organization (WHO), mHealth is "the medical and public health practice supported by mobile devices such as mobile phones, tablets, patients monitoring devices, personal digital assistant, and other wireless devices." (Bruck & Rao, 2013) For the purpose of this research, we aim to examine mobile health industry in the context of north America, where a group of 20 mHealth companies, most of which were founded around 2000, are the focus of our investigation.


Healthcare is an enormous industry that includes homogenous and heterogenous areas of inquiry. The advent of mobile technology, on the other hand, is also something that needs to be watched closely. The combination of these two areas of human achievement has brought with us some radical changes we now witness in our everyday life.

Figure 7: Players moving into mobile health industry (Source: own graphic)

The birth of mobile healthcare promises us with more accessible, cost-effective and individual-oriented care. The general areas of mobile health industry (alternatively known as mHealth) can be grossly devided into Wearables and Informationalized Hospitals.

Wearables target people who are not in perfect health and yet not terminally ill. Wearables monitor blood glucose level, heart rate, blood pressures, etc. When used in combination with smart phones, and/or computers (with pre-installed apps), consumers get professional health advice on when and what they should do to keep health (One brand, Sotera Wireless, goes even further to monitor the vital signs of patients under intensive care). Generally speaking, these methods are preventative in nature. And therefore save costs. Companies that specialize in the production of wearables includes, Nike, Fitbit, Apple, Jawbone, and Sotera Wireless.

Informationalised Hospitals are as commonly seen as the wearables medical devices. This is more complicated than wearables in the sense that it involves more stakeholders. Furthermore, complicated technology that deals with data processing (and subsequently Big Data/decision support systems/business intelligence), in addition to cloud computing, computer programming, and wireless communication (which are already used in wearables) is required. Companies that engaged in this area of business include, Athenahealth, Qualcomm Life.

Greater challenge brings greater benefits. Informationalised Hospitals are more connected than the traditional hospitals. Pharmacists, family members, home nurse, physician, and patients are connected through smart phones/tablets on an integrated online platform (such as Canvas/Aims at Cityu). The service strives to ensure that patients receive continuous care after they are discharged from hospitals. This will be especially helpful to people with chronic conditions that need to on habitual medication.

There are other services that combine mobile and health. One particular digital platform promises to collect the health record of patients and then match them with healthcare professionals with specializations. The platform then charges a fee from the hospitals for successful matching.

Another way that values are generated are through the knowledge accumulated in the decision support systems, so called Big Data. Research agencies could utilise information for research on epidemic control. Practing doctors could gain insights on the cause of an illnesses and the best treatment plans.

Figure 8: Picture adapted from Gartner, "Hype Cycle of Telemedicine" on 15th of April, 2015

Mobile Health Industry (mHealth) Analysis

The Mobile health has a lot of opportunities now and will increase more in the future. According to the PwC and GSMA report (PwC & GSMA, 2012) global mHealth revenues will increase nearly six-fold by 2017, with monitoring services and applications representing 65% of the market. Based on this finding, mHealth has the potential to make a great impact on the healthcare industry, yet organisations are still uncertain on how to capitalist on the technology.

The regions and market segments for mHealth industry are various and different and the impact of mobile technology on the health service industry will vary. 
Also due to the various national health regulation and approving entities it is not easy to transfer successful products and offering from one country to another.
Smartphone applications (needed to regulatory approval) are according to Jahns (2010) the killer applications for moving into mHealth.

Figure 9: mHealth market 2015 (Jahns, 2010)

As mentioned in the introduction various socio and macro economical forces are impacting mHealth:

Aging population

Aging populations and chronic illness are driving regulatory reform. Public sector healthcare is seeking better access and quality, and it's looking to the private sector for innovation and efficiency. mHealth improves access and quality, and offers dramatic innovation and cost reduction.

Foundations already in place

The foundations of industrialization of healthcare are already in place — electronic medical records, remote monitoring and communications. ‘Care anywhere’ is already emerging. The platform for mHealth is set.

Personalization

Healthcare, like other industries, is getting personal. mHealth can offer personal toolkits for predictive, participatory and preventative care.

The emerging economics developing very fast in the last few years, and it will be a great market for mHealth industry. In the emerging markets surveyed, patient awareness and expectations of mHealth are, on average, far higher than in developed countries (see Figure 10 and Figure 11)

Figure 10: Patients are more aware of mHealth in emerging markets (Economist Intelligence Unit, 2012)

Figure 11: Emerging market patients have greater expectations of mHealth (Economist Intelligence Unit, 2012)

More importantly, far more patients are already using mHealth. 59% of emerging-market patients use at least one mHealth application or service, compared with 35% in the developed world, and among those who do not, emerging-market residents are more interested in starting.

New approaches are also being used for delivery health services in more cost effective way.
In Mexico, for example, a telephone-based health care advice and triage service is available to more than one million subscribers and their families for $5 a month, paid through phone bills.
In India, an entrepreneur has proved that high-quality, no-frills maternity care can be provided for one-fifth of the price charged by the country’s other private providers.
In New York City, the remote monitoring of chronically ill elderly patients has reduced their rate of hospital admissions by about 40 percent (McKinsey report).

As an emerging economic country, China will be a large market  for mHealth industry. After team member Connie Liu graduated from my college in US, she went back to China in 2012, and she could feel the developing shift away form just looking at the economic growth. People started to care more about their health more than before and also for their next generation. From organic food to mobile health equipment, people increase their awareness for all the things good for health.


However, other than the great opportunities, this industry also have some threats. The most important one is the products, and products need innovation.  Unfortunately, health care can be an isolated and local activity also due to local regulation: innovations are not widely known across different systems or beyond sector boundaries. Merely identifying and promoting innovations isn’t enough, however—leaders need to understand whether, and how, the lessons of innovators can be replicated elsewhere.

Cardionet – A new mHealth Player

Build a concept

Cardionet Inc. was founded in 1999 with the clear strategy to eliminate the limitation of traditional cardiac monitoring by integrating mobile technology.

Data in 2009 shows that there are over 4 million Americans having cardiac arrhythmia, and 78 million patient need to keep monitoring their heart rate at hospital according the same data. This at a cost of nearly 26'500 USD per person. Cardionet's Mobile Cardiac Outpatient TelemetryTM ("MCOT™") can do the same at a fraction of the costs of only 1'300 USD, i.e. at about 5%!

Source: Cardionet on YouTube

Make it happen

The traditional way for monitoring the heart rate are Holter Monitor, Event Monitor or In-Hospital cardiac telemetry. None of them are wireless, and the disadvantages include short duration of measurement, delay in reporting, symptoms driven measurement  limitation in recording, need of manual intervention and transmission. The resulting diagnostic yield (% where the heart measurements can be used to diagnose a heart condition) is 7% and 15% for Holter Monitor and Event Monitor respectively.

Figure 12: Differences in Diagnostic Yield (Source: https://www.cardionet.com/media/pdf/evolutionofmonfinal.ppt)

Cardionet launched MOCT that could be used in diagnosis and the treatment of arrhythmias. It offers ambulatory, continuous, real-time outpatient management solutions. What surprises us more is the diagnostic yield of more than 65%, i.e. it is not only cheaper but also more effective. Cardionet saw the possibilities mobile technology offered as one of the early ones in 1999 and spend a lot of effort to get it approved by the U.S. FDA in 2003. MOCT is a revolution in monitoring devices and profits from the first move advantage in developing it and getting FDA approval. Mobile technology is the key element to realize the long-distance monitoring.

Figure 13: The CardioNet System (Source: http://wenku.baidu.com/view/b1caab4c767f5acfa1c7cdda.html)

Consolidating the market

There is no doubt MCOT is an advanced and beneficial device at the core of Cardionet's business. But patient may not use this kind of product if it can’t be reimbursed by their health insurance even though FDA license  It’s smart that Cardionet quickly found its successful business model and way of marketing which is cooperating with health insurance company. For instant, Cardionet announced a three-year-cooperation agreement with one of the biggest insurance company United Healthcare insurance in 2013. This is a win-win situation ensuring Cardionet a stable income cash flow. Since MCOT built up a good reputation on detecting and treating heard conditions early, the insurance company also saves money for treating cardiac arrhythmia in the long run. The revenue grows 33% in 2014 compared to 2013, and the net loss is in a decreasing trend. Cardionet serviced approximately 550,000 patients in 2014.

Continuing Effort

Currently, Cardionet has a positive strong growth trend, and they are implementing the following strategy: To solidify company’s position as the leading provider of outpatient cardiac monitoring services, expand presence in the research services market and leverage monitoring platform into new markets.

1. There is a strong market demand for a smaller and lighter devices. The new generation of MOTC Cardionet devices is 45% lighter and 30% smaller.

   

   Figure 14: New Cardionet MCOT device (Source: https://www.cardionet.com)

2. Market requests a device with multiple functions. After reviewing the last generation of Cardionet, it enriches devices' new functions, patient video support, multi-language, a large OLED color touch screen and power switch, send and received text message.
3. Previous devices where isolated and could not share data beyond with other mobile devices. Cardionet developed an application in Apple store, with which patients could access the data on their iPad.

   

   Figure 15: Cardionet iPad access (Source: https://www.cardionet.com)

4. After being renamed to Biotelemetry, the company is working on providing more bio-related devices and services, not just cardio monitoring.

As a new player in the mHealth industry, Cardionet is facing a heating competition. The company keeps strengthening its competitive advantage through a serious of acquisitions in various areas. 

• Healthcare devices manufacturer: Cardionet designs and manufactures the devices and facilities on its own. The acquisition of ECG Scanning & Medical Services makes company more productive. 
• Health services provider: After setting up its own medical subsidiary, Cardionet further enriches its capabilities on the research side with the acquisition of Agility Centralized Research Services.
• Mobile hardware, software & network providers: With long and close cooperating with AT&A, Cardionet stabilizes its mobile services. The acquisition of Biomedical Systems Corporation's all assets in 2014 gives company access to internally develop Holter software.

Overall, Cardionet is a good example of innovation, together with the mobile technology creates MCOT, and keeps improving the quality and efficiency of devices and services. But we believe Cardionet still needs to explore more on providing better user-experience for their devices and make their devices easily connect with other mobile devices (not just the iPad). A further direction to move into could be to just manufacture the sensor part of a heart monitoring device and link with a smartphone or smartwatch. Cardionet could also explore further ways to better collect, store and utilize the data it is collecting. Advances in cloud technology and big data analytics offer new opportunities.

Conclusions and Outlook

Mobile technology and health services are a marriage made in heaven and having a huge impact on health industry while changing the way health services are provided and received.

Many challenges and questions remains and provide new opportunities for further innovation.

• How can the national regulation be harmonized or standardized to allow for easier access across national mHealth markets?
• As mHealth devices are more connected, how can the security be maintained, e.g. from hacking and manipulating the device's sensors?
• Can the health data be standardized so that it's easier to share between devices and its ecosystems?
• How can further technological advances be used further improved mHealth services?
• Are there limits on how the collected health data can be used?
• Etc.

Many socio-ethical impacts still need to be discussed.

• Who is the owner of your health data?
• Who has access to your health data? How is access granted? How is the data protected?
• How long will the health data be stored?
• Would it be acceptable for a health insurance to reduce your premium your have to pay if you give the insurance access to your health data?
• etc.

More questions than answers but one thing is sure, mHealth is here to stay and to evolve further. More offsprings of this marriage can be seen along the digital path (see Figure 16).

Figure 16: More disruptive forces along the Digital Path (Source: own graphic)

New technology like cloud computing and big data analytics and new players move into the health services market. For example IBM is working together with a health care company McCale to how see IBM’s technology could help doctors make better use of clinical data. (Orcutt, 2015).

The possibilities are endless....

Dear commenters, the possibilities are endless.
What do you think the future for mHealth will bring?
Where do you see the opportunities, challenges and threats?

Share your thoughts and let's start a discussion.

References

Athenahealth company website. Retrieved from http://www.athenahealth.com/ on 17th of April, 2015.

Bouysen, A. (2013), Why healthcare costs are hijacking childhood, http://afterthemillennials.com/2013/02/28/why-healthcare-costs-are-hijacking-childhood/. Retrieved 16 April 2015.

Cardionet, Concept = Win, Strategy = Epic Fail. (2010, August 31). Retrieved from http://singularityhub.com/2010/08/31/cardionet-concept-win-strategy-epic-fail/

CardioNet-A case study smart services leadership summit.(2008) Retrieved from http://wenku.baidu.com/view/b1caab4c767f5acfa1c7cdda.html

CardioNet Annual report 2015. Retrieved from
http://quote.morningstar.com/stock-filing/Annual-Report/2014/12/31/t.aspx?t=XNAS:BEAT&ft=10-K&d=05177547e5ad07391dd53f91a4b06d51

Economist Intelligence Unite (2012) Emerging mHealth: Paths for growth. Retrieved from www.pwc.com/mhealth.

Fitbit website. Retrieved from http://www.fitbit.com/cn on 17th of April, 2015.

Guangzheng hangseng investment report on Bio telemptry.(2013, August 6). Retrieved from
http://dln.gzs.com.cn/mail/201307/Attachment/8696ff7e-7cb3-464d-b7d5-7702d95c6ab7.pdf

Jahns, R-G. (2010), 500m people will be using healthcare mobile applications in 2015.

Jawbone website. Retrieved from https://jawbone.com/ on 17th of April, 2015.

Mechael, Patricia; Kwan, Ada; and Kern, Dayle. Chapter 9: Mobile Health. in Global Mobile: Applications and Innovations for Worldwide Mobile Ecosystem. by Bruck, Peter A. & Rao, M. (eds.) New Jersey: USA, Information Today, Inc.

Mobile Cardiac Outpatient Telemetry (MCOT) - Cardiac Telemetry | CardioNet Event Monitors. (n.d.). Retrieved from https://www.cardionet.com/

OECD (2013), Health at a Glance 2013: OECD Indicators, OECD Publishing, Paris.
DOI: http://dx.doi.org/10.1787/health_glance-2013-en.

Orcutt, M. (2015), Meet the Health-Care Company IBM Needed to Make Watson More Insightful, http://www.technologyreview.com/news/536751/meet-the-health-care-company-ibm-needed-to-make-watson-more-insightful/. Retrieved 17 April 2015.

PwC & GSMA (2012), Touching lives through mobile health Assessment of the global market opportunity.

Qualcomm Life company website. Retrieved from http://www.qualcommlife.com/ on 17th of April, 2015.

Sotera Wireless website. Retrieved from www.soterawireless.com on 17th of April, 2015.