US digital health spending set to increase, survey finds

Health plans, employers, and healthcare providers remain committed to adopting digital solutions and expect to increase their spending on the category, according to a recent poll.

The survey (PDF) by Peterson Health Technology Institute (PHTI) asked 332 purchasing decision-makers for their expected spending plans for digital health technologies in the next 12 months and found that 75% had increased spending over the previous two years.

All told, 97% of employers, 86% of health systems, and 84% of health plans reported that they intend to maintain or increase spending on digital health in the coming year.

Drilling down into the reasons behind that upward trend, all three purchaser groups reported increased consumer demand (83%) and improved health outcomes (62%) as the main drivers. Around two-thirds of health plans (60%) cited cost savings as a reason for their continued investment, a view shared by 49% of health plans.

Employers were somewhat less likely to be motivated by cost savings, with 34% of them citing that as a factor.

The top objectives across all three groups – cited by nearly all respondents – were improved health outcomes, reduced spending on conditions and overall healthcare costs, and improved access to health services.

"Health plans, employers, and providers want to meet continued demand for digital health solutions, while ensuring the solutions they purchase have strong evidence that they improve health and generate economic efficiencies," said Caroline Pearson, executive director of PHTI, an independent evaluator of digital health technologies.

"This survey shows that there is a valuable opportunity for digital health companies to better align their offerings with what purchasers need and want, which, in turn, will allow more people to access these tools and the benefits they can bring," she added.

Other findings in the poll include that the most common clinical indications targeted by purchasers of digital health solutions are diabetes, primary care, and mental health, with obesity a particular focus for health plans.

Most contracts with digital health tech providers last for two years or less, according to PHTI, which gives purchasers frequent opportunities to reassess the performance of the products, and risk-based contracts tied to performance are used in around 79% of cases.

"These findings call for companies to invest further in evidence generation, focus on user experience, and demonstrate return on investment," remarked Meg Barron, managing director of engagement and outreach at PHTI.