This is the fifth in a series of articles comparing the Covid-19 crisis in Healthcare to the financial crisis in 2008 that led to an industry-shaping boom in FinTech. Find the first article in the series (“Crisis Leads to Innovation”) here, the second (“The Guilty and the Innocent”) here, the third article (“An Innovation Timeline”) here and the fourth (“What Could Go Wrong”) here.
Previous articles in this series present the notion that the COVID-19 crisis offers an opportunity for the healthcare industry to examine the status quo and invite new innovation. This can come in the form of a renewed appetite for incumbent-startup partnerships, or in the form of vigorous investment into internal technology and modernization initiatives.
This article will focus on where we are likely to see spikes in interest within the healthcare landscape. I anticipate the emergence of innovation teams in existing healthcare incumbents, and may dig into that in a future article. But first, I predict we will see startups focus on the following three areas, and venture capital dollars will follow.
Data Will Power New Applications
Like Plaid and Quovo in FinTech, offering access to and manipulation of clean data will expedite the creation of myriad new products. The next wave of Healthcare apps will depend on data pulled from electronic medical records, insurance companies, and other agencies, which are notoriously difficult to penetrate. Startups of note: Secure AI Labs, Ribbon Health, Particle Health, and (admittedly not a startup) Google’s Cloud Healthcare API.
Healthcare From A Distance
The industry was already moving in this direction… slowly.
Telehealth: One Medical featured the ability to chat and video with providers, something I appreciated and deeply missed when I left New York and no longer had it. Health insurance companies and large physician practices have started offering telehealth services, but they tend to be clunky and antiquated. Organizations rapidly deployed telehealth capabilities to deal with COVID-19, and now that patients have gotten a taste of the convenience, expect to see rapid growth here with many competitors vying for the newly larger market share pie. Expect to see new features like smart symptom checking to come along for the ride. Startups of note: Firefly Health, Doxy.me, Buoy Health.
Delivery prescriptions: Capsule was another service I missed when I left New York. No need to visit a pharmacy, my prescriptions were delivered to my door reliably with a friendly chat interface. PillPack, acquired by Amazon for nearly $1 billion, is another popular service more widely available throughout the U.S.
COVID-19 has increased the urgency to avoid public places, but going to the pharmacy was never a pleasant experience. Delivery drugs, as well as daily goods, will become more convenient and more personalized. Startups of note: Mlkmnn, NowRx.
Narrow Clinical Scope With Better User Experience
If the healthcare boom tracks with its FinTech counterpart, we can expect to see startups that focus on one specific area of the clinical or care delivery experience, doubling down on a great user experience and promising to change the future of healthcare.
FinTech parallels might be Betterment and LendingClub. Where banks used to offer investment services and lending as part of their larger suite of services, these companies focused on one specific piece of an unbundled experienced and poured attention into the UX and UI. Healthcare will follow this trend. Startups of note: Cricket Health, Strive Health, Devoted Health, Virta Health.
This unbundling in the FinTech industry lasted the better part of a decade before consolidation began again. This first started with more mature startups acquiring other startups, followed by startups adding new offerings that started to look awfully close to traditional banking, followed finally by incumbent partnerships and acquisitions.
My hope is that health systems don’t take 10 years to start bringing in-house the critical changes needed in the industry. Healthcare cannot be provided in siloes for long, and patients should not require a separate mobile app for every potential ailment. This is an industry that needs the big players to catch on sooner rather than later to enable a more equitable, patient-friendly, common sense industry.
To do this, healthcare institutions need to focus not just on creating “innovation teams” or “labs,” but on integrating innovative thinking into their technology teams and bringing end user voices into the fold.
Startups that have the balance sheet to get through this crisis can pull quite a few pages from the FinTech playbook. Healthcare investors can do the same.
