PHTI published "Unlocking Value in Digital Health Report" - "Challenges And Opportunities To Implementing High-Value Technologies"

Excerpts

Recent studies have indicated that DHTs can serve as effective tools for remote disease management, facilitate access to timely care, and potentially increase affordability

However, unlike other sectors where the introduction of automation and technology tends to reduce costs, technological advancements in healthcare have often led to increasing costs and only marginal improvements in quality.4

the Peterson Center on Healthcare (“the Center”) aims to promote better digital health purchasing decisions – both encouraging broader uptake of

INTRODUCTION

high-value technologies and discouraging adoption of low-value technologies. This means setting a higher bar for clinical effectiveness and value that DHTs must clear to achieve market adoption, as well as ensuring that evidence generation aligns with purchaser incentives.

landscape analysis of the digital health market, focusing on the specific challenges and drivers of DHT purchasing

considered an array of questions, including: „ How are purchasing and coverage decisions for DHTs made? „ What kind of tools, processes, and external resources are used to identify, prioritize, and evaluate DHTs on the market? „ What challenges do stakeholders face in the DHT purchasing process, and how can these challenges be addressed?

DIGITAL HEALTH TECHNOLOGY LANDSCAPE

Investment in DHTs has ballooned with limited evidence on clinical outcomes and economic value

Despite high investment, many DHTs on the market today do not offer rigorous evidence

Given the pace and volume of DHTs entering the market, some countries have recognized the need for a well-defined evaluative pathway to promote the uptake of high-value DHTs. In the United Kingdom, the National Institute for Health and Care Excellence (NICE) created an Office of Digital Health dedicated to identifying high-value DHTs, establishing universal evidence standards for digital health, and working to improve DHT approval pathways

Germany

Belgium, Canada, Denmark, Sweden, and Singapore are also beginning to evaluate

In contrast, the United States lacks an independent assessor committed to analyzing the effectiveness and value of DHTs

The U.S. Food and Drug Administration (FDA) determines baseline safety and efficacy for a narrow segment of DHTs, predominantly software that meets the definition of a medical device and “poses a risk to a patient’s safety if the software were to not function as intended.”13 Many DHTs, such as low-risk technologies intended for wellness use, do not meet this definition and thus remain largely unregulated.14 Others are subject to the FDA’s risk-based framework for medical devices, with Class I and II – the categories applicable to many DHTs – not required to demonstrate safety and efficacy through clinical trials

purchasers – encompassing payers, self-insured employers, hospital systems, and providers – face a number of obstacles that hinder their ability make informed decisions in the digital health space

They are overwhelmed by the volume of DHTs on the market that lack credible, comparable data

They face competing incentives and complex interests

The spectrum of DHT purchasers encompasses a diverse set of entities from individual consumers to providers to self-insured employers and payers

In total, a relatively small number of payers determine whether and how DHTs are covered and reimbursed, directly influencing market access and uptake. Medicaid and Medicare Advantage plans in particular appear to have a highly aligned interest in increasing patient access to effective technologies while simultaneously controlling spending.

Yet even these payers can be driven by an intricate – and sometimes conflicting – set of internal incentives and goals. For example, a Medicare Advantage plan might expend funds on digital tools that increase member enrollment and retention, even if such tools do not reduce overall spending or measurably improve health outcomes. At the same time, many payers are not only purchasers but also developers and investors themselves.

Purchasers often lack centralized decision-making

There is a market need for independent, timely, and transparent DHT assessments

purchasers are facing a slew of new DHTs with a notable gap between their marketing claims and available data, internal competing interests, and an often reactive decision-making process shaped by market forces. The Center believes this purchasing environment can and should be different. An opportunity exists to set a higher standard for DHTs to enhance sector efficiency, productivity, and affordability, and now is the time to seize it.