Surge in digital health investment as purchasers focus on value, outcomes, and patient-centred care
The latest survey from the Peterson Health Technology Institute (PHTI) highlights a significant increase in the planned investment in digital health solutions by health plans, employers, and healthcare systems. This upward trend is expected to continue throughout the coming year as these groups prioritise value and measurable outcomes in their purchasing decisions.
Detailed Insights from the 2024 State of Digital Health Purchasing Survey
The 2024 State of Digital Health Purchasing survey, developed in collaboration with NORC at the University of Chicago, offers a comprehensive analysis of current trends in digital health adoption. The survey not only sheds light on the evolving landscape of digital health but also provides key data on spending, contracting approaches, and future priorities in this rapidly growing field.
Ongoing Expansion in Digital Health Spending
This survey gathered responses from 332 decision-makers responsible for acquiring digital health solutions. The findings reveal a continued commitment to digital health innovation and investment across a broad spectrum of purchaser groups. Notably, the data indicates:
- Employers: An overwhelming 97% of employers plan to maintain or increase their digital health expenditure.
- Health Systems: A significant 86% of healthcare systems intend to sustain or grow their digital health spending.
- Health Plans: 84% of health plans also expect to maintain or expand their investment in these technologies.
The broad adoption of digital health solutions reflects the increasing recognition of their role in enhancing patient care and improving operational efficiencies across the healthcare sector.
Factors Fueling the Surge in Digital Health Investment
Several key drivers underpin this surge in investment:
- Rising Consumer Demand: The growing appetite among individuals for accessible and convenient digital health solutions is a major catalyst for increased spending across all purchaser groups.
- Improving Health Outcomes: Digital health technologies are widely acknowledged for their potential to elevate the quality of care and improve health outcomes for people, which is a strong motivator for purchasers.
- Economic Efficiency: Particularly for health plans, the ability to reduce costs through the use of digital health solutions is a primary reason for heightened investment.
These factors highlight the dual appeal of digital health solutions: not only do they meet the needs and preferences of individuals, but they also promise better outcomes and cost savings for healthcare providers and payers.
Trends in Contracting and Performance Measurement
The survey also reveals emerging trends in how digital health contracts are structured and how their performance is assessed:
- Short-Term Contracts: The majority of contracts between purchasers and digital health providers have a duration of two years or less. This allows purchasers to regularly evaluate the effectiveness of the solutions and adjust their strategies as needed.
- Risk-Based Contracts: Performance-based contracts, which link payment to the achievement of specific outcomes, are increasingly common. The survey indicates that 79% of purchasers are using these risk-based arrangements for at least some of their digital health solutions.
- Outcome-Focused Evaluations: Health plans and healthcare systems are particularly focused on health outcomes when evaluating the performance of their digital health contracts. In contrast, employers are more likely to assess success based on user adoption rates and engagement levels.
This emphasis on performance and outcomes is part of a broader trend towards evidence-based decision-making in healthcare, ensuring that digital health solutions deliver tangible benefits to both individuals and organisations.
Top Priorities in Disease Areas
The survey also highlights the priority areas where digital health solutions are being deployed. Purchasers are focusing on the following key conditions and areas of care:
- Diabetes
- Preventive Care
- Mental Health
- Cardiovascular Disease
- Primary Care
These areas reflect the most pressing healthcare needs that digital health solutions are being leveraged to address, offering potential for both improved health outcomes and enhanced healthcare delivery.
Expert Perspective: Bridging Demand and Evidence-Based Solutions
Commenting on the findings, Caroline Pearson, Executive Director of the Peterson Health Technology Institute, emphasised the opportunity for digital health companies to align more closely with the needs of purchasers. She stated:
“Health plans, employers, and providers want to meet continued demand for digital health solutions, while ensuring the solutions they purchase have strong evidence that they improve health and generate economic efficiencies. This survey shows that there is a valuable opportunity for digital health companies to better align their offerings with what purchasers need and want, which in turn, will allow more people to access these tools and the benefits they can bring.”
Pearson’s remarks underline the critical importance of providing digital health solutions that are not only innovative but also backed by robust evidence of their effectiveness in improving health and creating efficiencies in care delivery.
Conclusion: A Growing Market with Clear Priorities
The 2024 State of Digital Health Purchasing survey provides a detailed picture of a rapidly expanding market, where purchasers are increasingly focused on value, outcomes, and patient-centred care. As digital health solutions continue to evolve, those that can demonstrate their ability to enhance health outcomes, engage users effectively, and deliver economic benefits will be in high demand. For healthcare systems, employers, and health plans alike, the message is clear: investment in digital health is here to stay, and the focus on performance and measurable outcomes will only grow stronger.
