Digital health buyers prioritize diabetes, mental health tools

Healthcare providers, payers and employers plan to increase their spending on digital health solutions in the coming year, prioritizing solutions focused on diabetes, mental health and preventive care, according to new survey results.

Conducted by the Peterson Health Technology Institute (PHTI), in partnership with NORC at the University of Chicago, the "2024 State of Digital Health Purchasing" survey provides insight into the selection process and adoption plans among purchasers of digital health technology. The survey polled 332 people responsible for purchasing digital health solutions at health plans, employers and health systems between July 16 and Aug. 15, 2024.

A majority of digital health purchasers (75%) have increased spending on digital solutions in the past two years. Rising healthcare consumer demand for these solutions is the primary factor driving their purchases, with 83% of survey respondents citing this. The second most cited driver was digital healthcare's ability to improve health outcomes (62%), followed by potential cost savings (47%). These reasons for increased digital health spending were relatively consistent across types of purchasers.

Most digital health purchasers (39%) have a suite of solutions covering three to five clinical conditions. Most currently prioritize digital health solutions for diabetes (65%), primary care (62%), mental health (56%) and preventive care (56%).

A vast majority of digital health purchasers are looking for solutions that improve health outcomes, reduce spending on specific clinical conditions and overall healthcare costs and enhance access to healthcare services.

Most employers (90%) and health plans (61%) have a standard set of internally developed criteria to guide decision-making on purchasing digital health solutions. However, only 48% of health systems have the same.

While all purchasers are looking for solutions with evidence showing they will improve overall health and wellness, health plans (92%) and employers (93%) are also prioritizing solutions that will positively impact finances. On the other hand, 92% of health systems are looking for solutions that will decrease healthcare utilization while maintaining or improving quality.

Further, 97% of employers and health system digital health purchasers say they will prioritize solutions that provide data back to clinicians that enhance care, while 91% of health plans will prioritize solutions that are easy to use.

Looking ahead, 84% of health plans, 86% of health systems and 97% of employers plan to maintain or grow their digital health offerings in the coming year. Most health systems are looking to improve patient experience (80%), most employers are looking to improve productivity (74%) and most health plans are looking to reduce health spending and improve member experience (72%). Solutions targeting diabetes, mental health, preventive care and cardiovascular health are at the top of purchasers' lists in the next 12 months.

"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," said Caroline Pearson, executive director of PHTI, in a press release. "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."

Funding for digital health technology reached a record high in 2021 before falling drastically in 2022 and 2023, indicating that developers must adapt their strategies to survive in a rapidly evolving market.

The rise and fall of digital funding have followed virtual care utilization trends. For instance, data from Epic Research shows that telehealth use encompassed less than 1% of all visits in the last three quarters of 2019, jumping to 31.2% in the second quarter of 2020 before dropping to 5.8% in the third quarter of 2023.

Keeping track of these trends can help virtual care stakeholders focus on delivering value through digital health technology selection and implementation.

Anuja Vaidya has covered the healthcare industry since 2012. She currently covers the virtual healthcare landscape, including telehealth, remote patient monitoring and digital therapeutics.