Healthcare faces multiple challenges that will only intensify in the years ahead. The global population is ageing and growing; by 2035, it could rise to nearly 9 billion people. The incidences of chronic diseases such as diabetes, cancer and dementia are also growing, with global treatment costs for these conditions slated to reach US$47 trillion by 2030. Backlogs in state-funded health services are delaying routine treatments, and given the global shortage of healthcare workers, it is unlikely that this problem will resolve itself soon. Though newer medications, such as GLP-1 drugs, offer hope in treating a range of medical conditions, the cost is currently too high for the general population; a course of such obesity drugs in the US would set the average patient back US$500 a month. And inequalities in income and education further aggravate health inequalities. All the while, consumers and patients who have come to expect convenience and high levels of service in their retail experiences are now raising their expectations for their own healthcare.
But today’s challenges also represent tomorrow’s opportunities. Imagine a future in which personalised treatments are available to all; where drug discovery, enabled by AI, is faster, more effective and less costly than it is today; where technology platforms and health services collaborate to make care and procedures more digitally enabled, and hence more accessible for all; where smart personal consumer electronic devices are able to detect the early warning signs of an expanding range of conditions; where wearable technology and innovations in medical devices allow for real-time AI-powered diagnosis.
Along with every other aspect of the industrial ecosystem, healthcare is being reconfigured under the pressure of key megatrends: climate change, technological disruption, demographic shifts, a fracturing world and social instability. These megatrends are long term in nature, but their impact is being felt today. That means business leaders must tackle a combination of ever-changing short-term crises and, at the same time, consider how their organisations can adapt to the impact of the megatrends in order to evolve and thrive.
The shifts brought about by the megatrends are manifesting themselves in six basic areas of human activity: how we build, make, move and power, and how we feed and care for ourselves. In healthcare, as in each domain, a new ecosystem is emerging. Tomorrow’s care ecosystem will look much different from today’s healthcare industry, as it evolves to bring together traditional and non-traditional players cooperating and innovating as they envisage, enable and deliver care interventions.
A massive shift in value—or as we term it, value in motion—will be created in this care ecosystem. Entirely new value pools will emerge, with the patient at the centre. Others that are small today could grow large, while some will disappear altogether. Incumbents and start-ups, large and small organisations, public and private companies, and regulators will join the ecosystem from a wide array of legacy sectors spanning both the ‘real’ and the financial economy. The health ecosystem will reconfigure into a larger and more diverse network, capable of meeting rising demand and coping with increased cost pressure and rising consumer expectations.
Although industry players have already started to work in this direction, there is much more to be done. Leaders can confront the challenges they face and take advantage of the many opportunities that present themselves by transitioning from keeping a narrow focus on their direct legacy value chain to embracing the broader ecosystem.
In our view, the global care ecosystem will be reconfigured around four key attributes over the coming decade. It will be more preventative, addressing disease risk factors upstream to avoid deteriorating conditions and to keep people well longer. It will be more personalised, as care shifts from today’s one-size-fits-all approach to one tailored to individuals’ unique needs. Healthcare will be more predictive and proactive, using advanced technologies to switch from being largely reactive to intervening before issues become critical. And it will be more focused on the point of care, changing where, how and by whom care is delivered—with areas such as telehealth, remote surgeries and physical community-based facilities set to experience strong growth.
Focusing on disease risk factors and promoting self-directed healthy living and wellness can reduce the need for care. When leaders prioritise prevention, the overall health of the population can be improved, reducing the strain on healthcare systems. In the UK, the volunteer-led Our Future Health programme uses genetic information to develop treatments focused on disease prevention. It’s funded through a combination of government grants and investments from life sciences companies and health research charities, and in addition to offering financial support, all stakeholders providing financial backing are also bringing their skills and expertise to help in the discovery of more effective disease prevention and treatment. In Malaysia, the NGO Better Health Programme has developed a digital health app, MyBHP, aimed at improving the capacity to prevent non-communicable diseases through a healthier diet and weight loss. The app has enlisted local food vendors and food outlets as part of an obesity reduction programme, and serves as a platform for marketing healthier food products.
Personalised care can bring considerable improvement to health by enabling more balanced and careful evaluations of potential treatment options. By considering the patient’s genetic make-up and contributing factors, such as lifestyle and environment, tailored treatments can address each patient’s individual needs and characteristics. Such an approach will allow for more precise diagnoses, the identification of abnormalities for which treatment decisions may be less obvious, effective interventions and a potential reduction in expenditures. In Dubai, meta[bolic], a therapeutics company, integrates data into its GluCare health platform gathered from the Oura wearable ring, which tracks numerous markers, including heart health and metabolic activity. Constant monitoring is being used to prevent complications and identify the early stages of conditions before they worsen.
Healthcare organisations need to harness data and technology to take a more predictive and proactive approach to care. Doing so may enable them to treat patients at an earlier stage, before diseases and other health conditions can develop. This can help improve patient health outcomes, reduce the care burden and increase quality. There are numerous ways in which proactive care is being supported. For example, data analytics and testing can identify adverse health conditions earlier, which allows for more timely interventions. Zoe, a health programme that runs in the UK and the US, provides consumers with home testing kits that include a blood glucose monitor to check which foods cause blood sugar spikes. This helps Zoe customers make healthier food choices that better support gut microbiome health.
Individuals will be able to manage their health with subscription-based health management models, in which healthcare providers monitor and maintain an individual’s health. In the US, 1upHealth’s cloud platform is helping improve patient outcomes by providing efficient access powered by health data to deliver more proactive and effective care. It does this by facilitating data sharing among providers, payors, health tech companies and life science firms, along with claims data.
Shifting care locations to settings that are more accessible and convenient for patients changes the dynamics of care delivery. This approach includes the use of telehealth, community-based services and remote surgery, which could provide significant cost savings, in addition to making care more patient-centric and efficient. Kaiser Permanente aims to bring convenience to consumers by providing healthcare services at Target Clinics in California, where customers are able to fill prescriptions at the co-located CVS pharmacies within the Target Clinics. The company’s experience in providing innovative care solutions has also led it to set up a venture fund for other potential providers to drive even more innovation.
In a patient-centric model, organisations leverage critical enablers to deliver care in new ways.
A number of critical enablers are needed to overcome the many blockers and drive the reconfiguration of the care ecosystem. It is important for organisations to master their ability to push these levers to accelerate progress.
Delivering care in the future will demand a different approach to attracting and retaining healthcare workers. Employers should focus on developing new employment models that incentivise—and motivate—the workforce. Upskilling staff is equally motivational. It gives health professionals the capacity to integrate new technical skills and widen their skill sets. This is essential for a future-ready healthcare system.
Technology plays a significant part in improving health outcomes. Data gathered from wearable devices and monitors is enabling more effective disease prevention and management. Blood glucose monitors, once a specialised solution, are now a mass-market offering. Advances in technology empower patients by giving them wider information access and tools for self-directed health management. Tech is also facilitating remote consultations and even remote surgery.
AI applications have use along the value chain to augment care teams. In the front office, AI can be used in clinical ways to help identify at-risk patients for a care team so they can be monitored more closely. IT can be applied to improve data quality via coding, to enable more accurate diagnoses of conditions such as delirium. AI scribes, which automate the transcription of physicians’ notes, can alleviate the back-office burden on care teams.
Data-sharing is fundamental to generating better health insights. Because of the sensitivity of patient data, sharing must be facilitated through the institution of robust data regulations and safety measures to guarantee privacy and security. Moreover, individuals and companies need to be encouraged and incentivised to share health data. Healthcare players must also harness data for better predictions and planning, and use it as an engine to drive new innovations.
Regulation needs to evolve from covering individual countries to being more global in order to account for the potential provision of more cross-border care services.
The transition to new healthcare models that focus on early intervention, personalised treatments, integrated care and community-based models will put a renewed focus on funding, which will force tough decisions on how funds are allocated. Pharmaceutical and life sciences companies will need incentives to adapt to the new care models so that their business models remain viable, whether those incentives take the form of value-based pricing or grants and subsidies for preventative drugs. All stakeholders in the care ecosystem need to recognise how a reconfiguration will benefit all healthcare players in the long term.
Empowering consumers is central to the future of healthcare. This means providing individuals with the information, tools, agency and education they need to make informed decisions about their care. Patient education also plays a role by emphasising the need for preventative and proactive care and in fostering healthier behaviours. Facilitating the proper use of health data and technology to support self-monitoring can further reduce the care burden through strategies such as virtual ward scenarios, which allow patients to receive hospital-level care at home. Wearable technology further empowers individuals through access to and ownership of personal health data.
To take part in and take advantage of the evolving healthcare landscape, it’s important to get to work now. All players in the future of healthcare should develop a clear understanding of what the ecosystem will look like. This includes mapping out how and where value will be created or destroyed. Players should then decide how they want to contribute to each ecosystem based on their existing and future capabilities. Business model reinvention will be necessary to shape and reposition the organisation for success within the reconfigured ecosystems that healthcare players have mapped out. Finally, players should actively work to bring other participants into each ecosystem they inhabit by developing new or evolved third-party relationships and collaborative models to help them achieve success.
In a series of forthcoming articles, we’ll be taking a close look at how to prepare for the coming transformation in healthcare. We’ll identify what actions will need to be taken in the workforce, and the impacts of technology and AI, data and insights, regulation and planning, consumer empowerment, and funding and incentives.
Professional guidance and multiple-industry experience for policymakers, healthcare providers, payors and health-sciences organisations.
Solutions for the complex challenges affecting business, delivered by PwC’s global network of pharmaceutical, biotech and medtech experts.