On the surface, technology-enabled home health care should be thriving in the United States. The country’s aging population and the transformation of acute illnesses such as heart failure into chronic diseases mean that the number of patients is growing. In addition, new medical-technology devices could help keep patients at home rather than in costly institutions, such as assisted-living facilities or nursing homes—leading to potentially big savings for the health care system.
Instead, the full potential of the technology-enabled home health care market remains to be tapped. In the United States, home care accounts for about 3 percent ($68 billion a year) of national health spending. The market is increasing by about 9 percent annually solid but hardly booming growth, especially since labor (mainly nurses and aides) accounts for about two- of the expenditure and home-monitoring technology represents a small fraction of it. What’s holding the market back? We observe a daunting array of financial and operational barriers, including the misalignment of incentives between payers and providers, the need to demonstrate a strong clinical value proposition, and the problem of designing attractive, easy-to-use products that facilitate adoption by patients.
Technology holds a central role in expanding the market for home health care. Historically, most of its infrastructure and equipment consisted of durable medical products: walkers, wheelchairs, wall rungs, safety rugs, and the like. That infrastructure enabled basic home care but could not substitute for the more sophisticated capabilities of specialized care settings, such as on-call nursing in long-term-care facilities. In recent years, however, new home care technologies—Internet-enabled home monitors, apps for mobile health, and telemedicine—are bringing aspects of advanced care into patients’ homes. These technologies are finding a place in all parts of the globe (see sidebar, “Home health care around the world”).
Expanded technology-enabled home care offers a promising pathway to bend the cost curve for ever-growing health care expenditures. Independent of the economic benefit, the moral value of enabling older members of society to live in grace and dignity in their own homes, with a ripple effect on their caregivers, is arguably the most important—if unquantifiable—benefit of home care. It will move ahead, however, only if stakeholders develop more equitable reimbursement models that create greater incentives to participate in the technology-enabled home health market. In addition, medical-device makers must focus on technologies that are easier to use, have a real impact on patients’ conditions, and make it possible to measure results.
An understanding of these issues is important for all stakeholders: medical-device manufacturers, insurers, doctors, hospitals, and government regulators seeking to optimize investments in home health care. With the market growing, and expansion opportunities available both domestically and internationally, this is a promising time to be in the business of home care technology.