Survey: 'Connected health' could cut healthcare costs by 40 percent

By Bernie Monegain
01:58 PM
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A patient-centered and coordinated approach to healthcare could save billions, according to a survey of leading healthcare providers, patients, payers and technology leaders.

The survey, released today by the Massachusetts Medical Device Industry Council (MassMEDIC) and Cambridge Consultants, a technology product design and development firm, shows that a focus on patient well-being will improve overall health outcomes. In addition, the survey indicates care coordination will reduce wasteful spending in defensive medicine, inefficient claims processing, medical errors and emergency room services.

The findings come on the heels of an August report issued by PriceWaterhouseCoopers' Health Research Institute, which found that wasteful spending in U.S. healthcare is estimated at $1.2 trillion annually, comprising more than half of the $2.3 trillion spent in total.

The greatest areas of excess, according to the report:

  • $210 billion in defensive medical practices such as redundant, inappropriate or unnecessary tests and procedures;
  • $210 billion caused by inefficient healthcare administration; and
  • $100 billion for the care necessitated by preventable conditions.

In many cases, the report says, healthcare specialists are motivated to employ tests or procedures based on concern over liability or increasing their income over the needs of a patient.

Of the survey respondents who were familiar with the connected health approach, 75 percent predicted that this new preventative practice could cut healthcare costs by up to 40 percent.

An integrated connected health approach advocates an end-to-end solution, giving patients control as well as responsibility and connecting them with a wide network of healthcare professionals and online applications. This integration can be achieved through a range of technologies, beginning with electronic medical records and expanding outside clinical settings via connected devices such as glucometers and inhalers. 

Advocates of connected health say the approach can improve medication adherence, enable early detection, reduce long-term treatment costs and improve patient access to, and interaction with, healthcare providers.

The survey also reveals a lack of knowledge about the connected health approach, with 40 percent of respondents indicating they are "not aware of connected health solutions or examples."

"It is apparent that the survey results call for a concerted national educational campaign, for the medical community and the public at-large, on the virtues of using connected health solutions to improve patient adherence, engagement and clinical outcomes," said Joseph Kvedar, MD, founder and director of the Boston-based Partners Healthcare Center for Connected Health. "As early adopters of this philosophy at Partners, we have seen improvements in operational efficiencies in our hospitals, and with insurers and pharmacies alike, not to mention more active, engaged and, ultimately, compliant patients."

While many respondents view connected health as a cost-saving alternative for U.S. healthcare, 90 percent of those who responded to the question believe widespread adoption will take four to 15 years.

The survey also revealed a narrow view of the connected health concept, limited in many cases to electronic medical records or remote monitoring.

"Effective and innovative connected health technologies exist in the market today, albeit in an uncoordinated and piecemeal fashion," said Vaishali Kamat, group manager at Cambridge Consultants and organizer of the survey.  "But if we adopt a connected health mindset and improve interoperability, costs for linking patients with providers will come down and ignite realization of the explosive market potential cited in the survey."

"We are already seeing new players entering the healthcare space, deploying smart solutions targeted directly at consumers," Kamat added. "We cannot ignore the potential that this has to improve the outcomes for all the stakeholders in the healthcare world."

Holding back adoption is that no single owner is accountable to drive the solutions, the survey showed. Insurers, institutional medical care providers and drug or medical device companies are skeptical and slow to move, waiting to see the outcomes of recent political and other market developments.

"Fixing healthcare in this country should be our government's highest priority," said Thomas Sommer, president of MassMEDIC. "And we know that even with all the technology in the world, the political will must be there as well.  Elected officials need to know about the incredible potential of connected health before it is too late as we begin to design new cost-saving measures into the healthcare system."

To coincide with Friday's release of the survey results, MassMEDIC and Cambridge Consultants are hosting "Delivering on the Promise of Connected Health," a program highlighting the potential benefits that connected health could bring. The meeting is at the Massachusetts Medical Society headquarters in Waltham, Mass.