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The Future of Digital Health 2022 Health Care Innovation Predictions

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ased on our collective perspectives, we made some key predictions in our 2021 report related to the future of digital health and beyond— forecasting, for example, that: • use of telemedicine for outpatient care would continue to rise; • use of remote patient monitoring (RPM) tools would be more common; • in-home diagnostics would gain a stronghold; • direct-to-consumer (DTC) companies would continue to flourish; • private equity, VC firms, and the public markets would continue to pour money into population health tools. Most of our predictions proved to be reasonably accurate, although rapidly changing market dynamics, unsurprisingly, meant that not everything unfolded exactly as we expected. To take some examples of predictions we made that were borne out: The COVID-19 pandemic did indeed, in 2021, cause use of telemedicine to continue to increase (although not as sharply as it did in 2020). The same was true of RPM tools. COVID also triggered an increased interest in home testing and diagnostics—companies like Cue Diagnostics are innovating in this area, with Cue delivering test results within 20 minutes. DTC business models continued to proliferate across the board, covering not only home health care products but also everything from prescription medications, to dental aligners, to eyeglasses, and more. Finally, the overall digital health market continues to see increased funding across the world. As a reference point, by Q3 2021 total investment in US-based digital health startups of $21.3B had already exceeded the previous annual record of $14.6B set in 2020, demonstrating a strong upward trend in investment dollars. Introduction 2021 was a year when we at BCG Digital Ventures–Boston Consulting Group’s corporate innovation and business building arm–watched to see whether new hybrid models of delivering health care are here to stay or beginning to fade. The health care space, just like the workplace, has been adjusting to the “new normal” of remote and hybrid working models and solutions. Over the past year, we have seen strong global growth in the use of tools, solutions, products, platforms, and business models that crossed what had once been a digital chasm and made combinations of in-person and remote care increasingly the norm around the world. We believe that in 2022 we will see a continuation of the major trends we highlighted last year, with a greater emphasis on scaling existing assets and infrastructure with the goal of providing “care anywhere.” This will result in developments impacting both the provider and patient experience, including the following: 1. continued increase in use of telemedicine, and greater usage of RPM tools and solutions within telemedicine; 2. continued improvement and scaling of home care services such as diagnostics and testing; 3. a continued uptick in the rollout of DTC models focused on a variety of services such as preventive care (e.g., by Care/of), dental care (Candid), vision (Marlo), and hearing (Lively); 4. emerging partnerships across traditional and non-traditional health care companies, especially around specific therapeutic areas such as mental health and women’s, to name two; 5. technology players (Amazon, Google, Apple, and Microsoft) continued to provide options for supporting the health care ecosystem, enabling providers to focus on problems not platforms; 6. placement of larger investments in population health tools and services, to be used by selfinsured employers (e.g., Fortune 500) or integrated delivery networks (e.g., UPMC, Kaiser Permanente) for care for their employee bases or networks, respectively. We hope the following predictions from our multidisciplinary and global team of digital health experts will provide you with a valuable framework and insights for advancing health care innovation in the new year. ASHKAN AFKHAMI Managing Director and Partner BCG Digital Ventures

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