wellness-as-a- service: opportunities for healthcare...4. big data and new technologies facilitate...

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DeborahWeinswig,ManagingDirector,FungGlobalRetail&[email protected]:917.655.6790HK:852.6119.1779CN:86.186.1420.3016Copyright©2017TheFungGroup.Allrightsreserved.

March1,2017

Wellness-as-a-Service(WaaS)isaformofelementaryhealthcaremanagementthatbundlestogethervariousservices,suchaslifestyleadvice,healthrecommendations,andthemonitoringofhealthmetricsandongoingconditions.Itisfacilitatedbytechnologyandcanbedeliveredonlinethroughdashboardsandinpersonthroughconsultationsandsales.

HerearesixwaysthathealthretailerssuchasdrugstorescandeliverWaaS:

1) Integratedatacollectedfromwearabledevicesandelectronichealthrecords,andcreateasingledashboardthatprovidesacomprehensiveoverviewofhealthdata.

2) Analyzeprevioushealthconcernsandprescribedtreatmentsandremediesinordertoformulatepersonalizedhealthcareplans.

3) Recommendsupplementsandsuggestwellnessroutines,includingphysicalexercisesandinformationaboutfitnessclasses.

4) Developandencouragecollaborationsbetweenfirmstopromotedialogwithexistingcustomersonproductsandservicespurchasedatdrugstores.

5) Providetime-bounddiscountsandofferstosubscribedmembersonproductstheybuyfrequentlyorservicestheyusefrequently.

6) Actaspointofcontactforassistancewithandmaintenanceofhealthdevicessoldinstores.

Wellness-as-a-Service:

Opportunities for Retailers in Tech-Driven Healthcare

Deborah Weinswig

Managing Director,

Fung Global Retail & Technology

[email protected]

US: 917.655.6790

HK: 852.6119.1779

CN: 86.186.1420.3016

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March1,2017

IntroducingWellness-as-a-Service(WaaS)Drivenbyhealth-consciousmillennialsandretiringbabyboomers,consumers’interestintheirownwell-beingisgrowing.Atthesametime,anagingpopulationispushingupalready-substantialUShealthcarespending.Inthiscontext,bigdataandnewtechnologiesareprovidingfreshopportunitiesforcompaniestodeliverinnovativeserviceofferings,includingWaaS.

So,whatisWaaS?Inshort,itisabundleofservices,enabledbytechnology,thataredeliveredasapersonalhealthplan.Imagineyourlocalretailclinicmanagingyourhealthdata,schedulingregularscreeningsbasedonyourhealthhistoryandneeds,andprovidinganonlinedashboardofusefulinformationandinsightsonhowtostayinpeakhealth.AWaaSpackagecouldprovideallofthat.Inthecomingyears,serviceproviders,includingretailers,arelikelytodevelopWaaSofferingsenabledbyanever-growingbodyofcustomerdataandcontinualimprovementsintheabilitytoanalyzesuchdata.

HowWaaSWorksWaaSbundlestogethervariousservices,suchaslifestyleadvice,healthrecommendations,andthemonitoringofhealthmetricsandongoingconditions.Itisfacilitatedbytechnologyandcanbedeliveredonlinethroughdashboardsandinpersonthroughconsultationsandsales.

AspartofaWaaSpackage,clinicscanprovideanonlineaccountwithadashboard-stylefunctionthatgivescustomersanoverviewofalltheirhealthdatafrommultipledevicesandtrackstheirprogressbasedontheconsultationsandservicesreceived.Anonlineaccountcanalsohelpcustomersviewtheservicesavailabletothemandscheduleappointments.Atthesametime,dashboardscanhelpretailersandclinicscommunicatewiththeircustomersmoreeffectively.

WaaSisabundleofservices,enabledbytechnology,thataredeliveredasapersonalhealthplan.

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Figure1.TheWaaSDeliveryModel

Source:FungGlobalRetail&Technology

WaaSisalreadyhere.OneexampleofexistingservicesistheMyCarolinasTrackerappdevelopedbynonprofithospitalnetworkCarolinasHealthCareSystem.Theappcurrentlyintegratespatients’electronichealthrecordswithdatafromtheirwearabledevices,butitworkswithonlyalimitedsetofdevicesandismadeexclusivelyforthehospitalnetwork’spatients.

HealowisasimilarplatformthatintegrateswearabledatafromFitbit,Withings,iHealthandJawbonedeviceswithindividuals’healthrecords;theplatformhelpsuserssetupmedicationremindersandfinddoctorsandappointmentsintheirvicinity.OtherWaaSprojectsincludeaplatformsimilartoMyCarolinasthatwasdevelopedincollaborationbetweenmobilehealthtechfirmValidicandelectronichealthrecordsystemproviderMeditechinApril2015.

CollaborationisactuallyattheheartofmovingWaaSfromtheorytopractice.BecauseWaaSispredicatedontheabundanceofhealthdatathatmoderntechnologyprovides,itrequiresvarioustraditionalandemerginghealthcareplayerstocollaborateinordertointegratethetechnologytheyusetocollectandstoredata,aswellastosharethatdata.StakeholdersintheWaaSsectorinclude:

• Developersofmobilehealthapps.

• Manufacturers,softwaredevelopersandhardwaredevelopersinthehealth-trackingandmeasurementdevicesindustry;thesedevicesincludewearables,hearables,ingestiblesandembeddables.

• Emergingindustryplayers,suchasgene-profilingcompanies,thatdeliverhealthdatadirectlytoconsumers.

IntegratedataIntegratethepafent’sdatafromhealthapps,devicesandmedical

records

Analyzedataandhealthhistory

Analyzepagernsfromthepafent’shistoricaldataandlikelytrendsbasedonthegeneraldataset

Developandrecommendhealth

plans

Developandrecommendplanstohelppafentsstayhealthybasedonhealthdataanalysisandinputfromnetworkofexternalandin-housephysicians

Offeradd-onservices

Managecommunicafonwithinsuranceagents,setupphysiciananddenfstappointments,issuevaccinafonreminders,etc.

CollaborationisattheheartofmovingWaaSfromtheorytopractice.

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March1,2017

• Startupsthataredevelopingsupportingappsforexistingdevicesand

ITsystems.

• Traditionalstakeholdersintheindustry,suchaspharmaceuticalcompanies,healthcareprovidersandinsurancecompanies.

FourFactorsEnablingWaaSWeseefoursignificantsocietal,technologicalandoperationalchangesdrivingtheimplementationofWaaS:consumerinterestinwellness,anagingsociety,primarycareshortfalls,andbigdataandnewtechnologies.

1.YoungConsumersAreInterestedinWellnessOnedrivingforceintheWaaSmarketwillbehealth-consciousconsumers’demandforimprovedhealthserviceofferings.Thoseinyoungeragegroupsshowparticularinterestinhealthandwellness,andtheirconcernsrangefromsafeguardingagainstillnessandpossessinganoptimalleveloffitnessandenergytosimplyperformingattheirbestatworkorindailylife.ThisholisticviewofwellnessdovetailswiththeencompassingviewofhealththatWaaScanoffer.

Aswechartbelow,increasedinterestinwellnessisbeingdrivenbyyoungeragegroups,suchasmillennials.

Figure2.US:ProportionofAgeGroupsthatHaveParticipatedinSelectedHealthProgramsinthePast12Months,byGeneration,asofJanuary2016(%)

Base:2,320InternetusersSource:TheFuturesCompany/NationalBusinessGrouponHealth/Aon

19

19

22

37

24

23

28

51

33

36

38

54

HealthCondifonManagement

LifestyleManagementorCoach

Nutrifon/HealthyEafng

FitnessAcfvity

Millennials GenXers Boomers

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2.AnAgingSocietyDrivesRisingCostofHealthcareInNorthAmerica,thoseaged65andolderwillleapfromrepresenting15%ofthetotalpopulationin2015to21%in2030,accordingtoUNforecasts.Thegrowthoftheagingpopulationisbeingdrivenbypeoplelivinglonger,sothepopulationof“olderseniors,”thoseaged75andolder,willgrowevenfasterthanthetotalseniorpopulation.

Inevitably,thismeansthetotalbillforhealthcareisgoingtorise.TheUSalreadyspends,byfar,themostpercapitaonhealthcare—withoutachievinguniversalcoverage.Per-personhealthcarespendingintheUSisroughlydoublethatincomparablecountriessuchasFrance,theUKandJapan,andsuchspendingintheUSroseby14%between2010and2014(latest).Inallmarkets,butespeciallyintheUS,individuals,publicbodiesandprivatecompanieswillincreasinglylookformorecost-effectivewaystoprovidehealthcareservices.

Figure3.SelectedCountries:Per-CapitaTotalHealthExpenditure(USD)

Source:WorldHealthOrganization

Atthesametime,moreandmoreseniorsareexpressingapreferenceforaginginplace:theyareincreasinglyeschewingcareinstitutionsinordertostayintheirownhomes,evenwhentheyneedassistancewiththebasictasksofeverydaylife.Thistrendshouldunderpindemandforeverydayhealthmonitoringandadvice.

• Thisimpactofanagingsocietyisasubjectthatwehavecoveredindepth,includinginournewbook-lengthreport,MiningSilver:IdentifyingOpportunitiesintheSeniorBoom.

2,847

3,384

4,110

3,491

4,584

5,348

4,700

5,286

8,269

2,658

3,258

3,703

3,935

4,959

5,292

5,411

5,694

9,403

Spain

Italy

Japan

UK

France

Canada

Germany

Netherlands

US

2014 2010

Individuals,publicbodiesandprivatecompanieswillincreasinglylookformorecost-effectivewaystoprovidehealthcareservices.

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3.HigherDemandResultsinPrimaryCareShortfallsRelatedtothedemandsofanagingsocietyisanexpectedshortfallintheprovisionofprimarycare.TheAssociationofAmericanColleges&UniversitiesestimatesthattheUSwillseeashortageof91,000physiciansby2020,splitevenlybetweenprimarycarephysiciansandspecialists.

Retailclinicscanhelpeasethepressureonprimarycareprovidersatdoctors’clinicsandhospitalsbyemployingnursepractitionersandphysicians’assistantstoprovidecustomerswithbasiccare.WaaSofferingsatretailclinicscanhelpcustomersobtainbasiccareandadviceatthesevenues,betterenablingdoctors’clinicsandhospitalstoservethosewithurgentorseriousconditions.

4.BigDataandNewTechnologiesFacilitateNewSolutionsAsconsumers’interestinwell-beinggrows,anincreasingnumberofpeoplearetakingapreventativeapproachtowellnessbytrackingtheirhealthandmeasuringtheirfitnesslevelsviadigitaldevices.Theseincludewearables,hearablesandingestibles,whichcancaptureandprovidedatathatcanbefedintotheWaaSecosystem.

NewwaysofcrunchingsuchdataarealsoenablingWaaS,whichispredicatedonbigdata.Atitsheart,WaaSconsistsofpullingtogethercustomers’healthdatafromelectronichealthrecordsandhealthmeasurementdevices,thenanalyzingthosedatatoprovidepersonalizedproducts,services,treatmentsandprocedures.

WhoCanDeliverWaaS?WaaSpresentsopportunitiesforfirmsandserviceprovidersinanumberofsectorsandformats,butretailerssuchasdrugstoresareparticularlywellpositionedtobringWaaStoconsumersfortworeasons.First,drugstoreretailersarealreadyahubinthehealthcarenetwork,interactingwithpatients,pharmacybenefitmanagers,healthcareproviders,pharmaceuticalandnutraceuticalcompanies,andotherstakeholders.WaaStakesthishubfunctiononestepfurther,enablingdrugstorestoaggregateinformationfromacrossthisnetworktodeliveradviceandservicestocustomers.

TheUSisexpectedtoseeashortageof91,000physiciansby2020.

NewwaysofcrunchinghealthandfitnessdataareenablingWaaS,whichispredicatedonbigdata.

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Second,theclinicsatdrugstorescanactascustomertouchpoints.Theclinicsaremoreaccessible,andconsultations,assessmentsandcareatthesevenuescostlesspervisitthantheydoatphysicians’officesandurgentcarecenters.“Weownthelastmileofcare,”CVSHealth’spresidentandCEOrecentlynoted.Thisgivesdrugstoresanaccessibleandapproachablepositionfromwhichtobuildserviceofferings.

RecentdatafromNielsensupportourperceptionofconsumerdemandforclinicsinretailstores:thecompanyfoundthatatleast29%ofUShouseholdswithchildrenand26%ofmillennials(ages18–34)hadvisitedaretailclinicinthe12monthsendedSeptember2016,mostlyfortreatments.Nielsenalsonotedthattheseconsumersaremorelikelythanotherstohavevisitedretailclinicsforassessments,screeningsandcounseling.

HowCanCompaniesBringWaaSOfferingstoMarket?SomeofthewaysthatretailclinicscanbringWaaStomass-marketconsumersareby:

1. Integratingdatacollectedfromwearabledevicesandelectronichealthrecords,subjecttopatientconsent,andcreatingasingledashboardthatprovidesacomprehensiveoverviewofhealthdata.Retailersandclinicscanworkwithdevicemanufacturerstointegratedatafromwearablesintoasingleappordashboard.

2. Analyzingprevioushealthconcernsandprescribedtreatmentsandremediesinordertoformulatepersonalizedhealthcareplans.

3. Recommendingandprovidingsupplementsandsuggestingwellnessroutines,includingphysicalexercisesandinformationaboutfitnessclasses.

4. Developingandencouragingcollaborationstopromotedialogwithexistingcustomersonproductsandservicespurchasedatthedrugstore.Walgreenshaspartneredwithpatient-generatedinformationdashboardPatientsLikeMetobetterconnectwithcustomersonthisfront.

5. Providingtime-bounddiscountsandofferstosubscribedmembersforproductstheybuyfrequentlyorservicestheyusefrequently.

6. Actingasapointofcontactforassistancewithandmaintenanceofhealthdevicessoldinstores.

BarrierstoImplementingtheWaaSModelWaaSisnotwithoutitsbarriers.Inparticular,itsdependenceoncollaborationandthesharingofdataraisepotentialoperationalandregulatorychallenges.OneofthebiggestobstaclescouldbealackofinteroperabilityandbidirectionalitybetweenexistinghealthcareITplatforms.DrugstoresuseITsystemsthatarespecifictopharmacymanagement,andelectronichealthrecordsobtainedfromphysicians’systemsthatareusedtodispenseprescriptionmedicationsmustbefedintosomesystems,astheinformationdoesnotautomaticallyflowbetweenthetwosystems.Insomecases,healthrecordsarefaxedtoadrugstore,wheretheymustbemanuallyenteredintothepharmacy’sdatabase.

Atleast29%ofUShouseholdswithchildrenand26%ofmillennialshavevisitedaretailclinicinthe12monthsendedSeptember2016.

WaaS’sdependenceoncollaborationandthesharingofdataraisespotentialoperationalandregulatorychallenges.

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AnothercomplexissueisinteroperabilitybetweendevicesandWaaSdashboards.Manyhealthappshavebeendevelopedtobecontrolledfromasingleplatform,suchasApple’sHealthKit.But,inpractice,theyneedtoundergoarevolution,justassmart-homeproductsdid.Manysmart-homedevicemakersmadetheirproductsopenandcompatiblewithsmartphonemakers’platformsinordertoincreaseadoptionandaccessibility.Similarly,morehealthappanddevicemakersneedtomaketheirtechnologyanddevicesaccessibletoplatformdevelopers.

Regulation,privacyconcernsandthesharingofdataareotherissuesthatproviderswillneedtoconsidercarefully.CollaborationandthesharingofinformationarenecessaryforWaaStobeeffective,whichraisesconcernsaboutcustomerprivacyandsharingdatainanappropriatemanner.Thecollectionandsharingofdatamustcomplywithregulations,someofwhichmayinhibittheprovisionofservicesthatcouldbeincludedinthismodel.WaaSleadersneedtoengageinadialogwithregulatorybodiestoensurethatcomplianceprocedurescanbealtered,ifnecessary,withoutcompromisingconsumerdataprotections.

Anothermattertoconsideristhatmanypatientsarenotcurrentlyusingtechdevicestotracktheirwellnessorhealthconditions.Creatingapersonalizedhealthplanforpeoplewhodonotusewearablesorothertrackingdevicesmaybelessstraightforwardthancreatingoneforthosewhohavemorereadilyavailablehealthdata.

Finally,somepatientsmayberesistanttoobtainingprimarycarefromaretailclinicinsteadoffromadoctor’sclinicoremergencycareunit.ThismayrequirethatretailclinicsemployphysiciansinordertotakeadvantageofthefullpotentialofWaaS.

KeyTakeaways:Data-DrivenHealthcareCanHelpwithFutureChallengesWeliveinanageofdata.Yetinthehealthsphere,muchofitremainsfragmented,withprimaryhealthcareproviders,techfirmsandretailersallhavingseparatesystems.ThevalueofWaaSliesinbringingthesedatatogethertoofferconsumersaholisticandpreventativeapproachtohealthcare.Barriersexistrelatingtotechnology,regulationsandconsumerperceptions.However,therewardsofanintegratedviewofhealthincludebetterprevention,easierandquickerprovisionofcare,andlowercostsonacomparablebasis—whichshouldincentivizetheparticipationofgovernments,companiesandindividuals.

Therewardsofanintegratedviewofhealthincludebetterprevention,easierandquickerprovisionofcare,andlowercostsonacomparablebasis.

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DeborahWeinswig,CPAManagingDirectorFungGlobalRetail&TechnologyNewYork:917.655.6790HongKong:852.6119.1779China:86.186.1420.3016deborahweinswig@fung1937.comJohnMercerSeniorAnalyst

SwaroopraniMuralidharResearchAssociate

HongKong:8thFloor,LiFungTower888CheungShaWanRoad,KowloonHongKongTel:85223004406London:242-246MaryleboneRoadLondon,NW16JQUnitedKingdomTel:44(0)2076168988NewYork:1359Broadway,9thFloorNewYork,NY10018Tel:6468397017

FungGlobalRetailTech.com

wellness-as-a- service: opportunities for healthcare...4. big data and new technologies facilitate...

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