October 5, 2022

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Future

2 min read

Two years of the COVID-19 pandemic have shifted the dynamics in the US healthcare value chain. The years from 2020 through 2021 were challenging for payers and providers. At the same time, innovation and growth continued unabated in services. Prospects over the next few years seem favorable, although persistent inflation in consumer prices could dent the outlook. Recovery in profitability partly explains this positive outlook. Another reason for optimism is the potential for scaling up innovation that was prompted by pressure the pandemic put on the healthcare system. Also, acceleration of value-based care models and increasing application of technology across the healthcare industry are likely to continue in the long term.

Variability in growth across different parts of healthcare persists and, in some cases, has become more pronounced. For example, government lines of business continue to account for the largest growth areas for payers. Care-delivery services outside the hospital are the fastest growing businesses for providers, given the continued shift to the non-acute setting. Meantime, the progression of value-based care and related risk payments as well as digitization of the value chain is shifting value creation across, rather than within, traditional healthcare subsectors.

The marketplace has begun to address the patient’s full health journey, leading to improved affordability, quality, access, and experience.


Many players, spurred by significant investment, are innovating their business models to create value and capture some of it in enhanced margins. In this article, we will review the shifts in healthcare profit pools, look ahead to how they might evolve, and examine how the pandemic has stimulated changes in industry business models.

Shifts in profit pools continue to accelerate

Healthcare industry EBITDA grew 5 percent pre-COVID-19 (between 2017 and 2019) and remained flat over 2020 and 2021. We estimate post-COVID-19 (between 2021 and 2025) growth at 6 percent (Exhibit 1). If the industry achieves this rate of growth, it could add about $31 billion in profits


between 2021 and 2025. We have not factored in the potential impact from macroeconomic headwinds, including persistent consumer inflation, in these estimates; profits could decline by more than $70 billion during this period if inflation continues unchecked.








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The post-2021 recovery and shifts in profit pools are likely to be driven by several factors, including the following.

Evolving payer mix

Payer profit pools are expected to shift substantially toward government segments, led by the growth in the over-65 population and popularity of Medicare Advantage over traditional fee-for-service Medicare. Further, as the economy recovers from the impact of COVID-19, we estimate that payers’ mix of business could shift from Medicaid to commercial (the share of commercial lives

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2 min read

“The fourth industrial age is listed here,” says Daniel Kraft, a wellness treatment futurist and clinical physician. “It’s transforming how we get our electronic banking accomplished, how we stream motion pictures. But well being treatment is still caught in the 3rd — or possibly the next — industrial age, with fax equipment and CD-ROMs.”

Specifically, improvements this kind of as artificial intelligence and machine learning have been stubbornly slow to enter the well being sector. And the significant strides that have been built in facts collection — wearables that keep track of your vitals, voice biomarker trackers, and genomic sequencing, to name just a couple of — have so far resulted in only a few commonly used, really beneficial purposes.

“No person wants a lot more information, they want the precise insights that are useable,” says Kraft, who prefers the term now-ist to futurist. “How do we make actionable information and facts that interprets to the level of care or the bedside?” 

Bob Wachter, chair of the UC San Francisco Department of Medicine and author of The Electronic Health care provider, stays optimistic that some of these new systems may continue to have a considerable impression. “No matter whether you happen to be on the lookout at an X-ray, or seeking to forecast how many men and women are likely to occur to the crisis space upcoming Tuesday, or viewing a client and staying reminded of an substitute diagnosis, A.I. will be practical in all types of ways,” he states. “I think it’s going to all function out. But it can be likely to take considerably extended and be far bumpier than any one anticipates.”

Listed here are five of the organizations industry observers say are leading the cost down that bumpy highway and reimagining the potential of overall health treatment.

1. Youper

Youper designed its A.I.-based mostly chatbot to guideline buyers by means of the procedure of cognitive-behavioral therapy, supplemented with remote psychiatrists, well being coaches, and an on the net pharmacy. The chatbot seems and feels like a normal textual content message trade: individuals talk about their feelings and thoughts and the A.I. responds with thoughts and guidance, as programmed by psychological wellbeing industry experts.

“Some persons say the chatbot is even greater than chatting to a human, mainly because you can say how you happen to be certainly feeling,” states Youper CEO Jose Hamilton. “[You might say,] ‘I’m emotion 100 percent angry’ or ‘100 % depressed.’ And then the chatbot will get started guiding you toward what’s earning you come to feel that way.”

Youper does not intend to change psychiatrists, but in its place to enable them to see more clients than just before at a decreased cost. “We are not able to just develop psychiatrists or therapists in the lab, but we can provide them with technological innovation to augment them,” states Hamilton. “Our purpose below is to have a therapist overseeing 10 occasions extra sufferers than a standard service provider would, because

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