While 2015 is shapping up to be another “challenge” year for President Obama’s signature healthcare reform law as republicans are ready to battle it in court and legislative sessions, it could bring another kind of test to the country’s healthcare providers on their investment in technologies over the years. Demand for virtual care, a group of services that allow patients to communicate with their doctors without setting their foot in offices or hospitals, is set to grow significantly in 2015 and onward, and they will test the nation’s healthcare providers on a range of IT areas that they have made substantial investment all these years—EMR, patient portal, telehealth infrastructure, etc.
How strong will the demand be? In 2014, billable service revenues from virtual care services are almost to double from 2013, rising from almost $400 million to over $800 million, according to our market estimates. In 2015, total revenues from billable services will grow another 73%. From 2014 to 2019, the CAGR for this market will be 87%, a fast growth phase for this young industry indeed.
We have seen both the evidence of consumer interest and the enthusiasm from the provider side. From 2012 to 2014, almost all consumer online activities related to virtual care functions have more than doubled—based on data from our annual health consumer surveys. These activities include traditional online patient portal services such as prescription refill request, lab results and schedule changes, but also communications-specific functions. For instance, the percentage of broadband households that email doctors for answers to their health questions more than doubled from 11% to 21%. Even new forms of communications, like video call, exceeded the 5% mark, tripling the rate in two years.
The provider enthusiasm is partly validated by the growing business of virtual care solution providers. I recently spoke to Roy Schoenberg, founder and CEO of American Well, a virtual care solution provider serving healthcare systems, insurers and self-insured employers. He told me that his business is growing rapidly, saying that demand has been a “Tsunami” and that traffic to sites supported by American Well’s technology “broke records weekly.”
Part of the momentum, he said, comes from the need to implement ACA mandates about patient engagement, but another reason is that traditional market barriers, such as medical board licensure requirements and provider resistance, are gradually fading away. “The market is in a 180 degree shift,” Roy told me.
What does virtual care mean for executives of hospitals and healthcare systems? It is first a test of their IT infrastructure to handle the growing traffic and system reliability and security. Traditional patient portal services should be fine, but interactive communications services such as video calls could be a potential area for trouble. Depending on the video communications protocols used on the provider side and end user video player configurations, software glitches could render a scheduled session unproductive for both patients and care providers. When there is a large volume of traffic to request virtual care services, it will test the system’s scheduling ability, the algorithms of which is usually based on multiple business factors along with doctor’s availability.
The second challenge will be on care providers’ health IT information systems. Real-time communications require timely access to health data and providers will not appreciate being stuck in the middle with patients on the line while the system is busy retrieving past health records and latest lab tests and images.
Finally, some online telehealth services, such as those supported by solutions from companies like Healthspot, require patients to self-measure their vital signs and pass them to doctors during a virtual care session. How such data will be fed into the EMR system without delay and then compared with similar historical data is critically important to patient experience. Integrating store-and-forward data with real-time decision support used in a virtual care service environment can be a challenge to care providers’ EMR vendors.
Longer term, I expect virtual care services to support multiple use cases, including routine care services, preventive care education, post-acute care follow-up, and chronic care coordination tasks. The virtual care service platform thus needs expansion and enhancement to better serve providers’ business goals. Having the right IT infrastructure and a seamless health IT integration process will be high-priority tasks for care provider organization’s executives.
So for hospital/health systems CTOs and CIOs, 2015 may be a busy year for them to feel the true power of health consumerism and get a good sense of their ROI on technology and health IT investment.
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