Health Economics Getting Ripe Quickly for mHealth Technology?

A recently released commissioned study by the National Business Group on Health verified what most people have already experienced: That employers are footing less of an employee’s health insurance premium bill. In the survey, 25% of executives queried stated that the most effective way to curb health care costs is by having the employee share in an increased share of the expense. 39% of the executives said they will increase the in-network deductible amount and 63% said they will increase the employees’ share of the premium contribution (most stating it will be a less than 10% increase).    Interestingly, only one percent of respondents said that focusing on quality-based networks and physician resistance was given as one of the contributing reasons. The report can be found at:

The rising co-pays and deductibles have resulted in employees seeking less health care.  This has resulted in an absolute lower spending for health care by insurance companies. The poor economy has likely contributed to this phenomenon as well.  This is in addition to the nine million people who became uninsured between 2008 and 2010 who have been found to decrease or delay getting health care by 72% (found in a study by the Commonwealth Fund).

Another study by the Kaiser Foundation recently released ( showed that the average increase in health insurance premium from 2001-2011 increased by 113% while the worker’s contribution to the premium rose 131%.   This does not include deductibles that are paid by employees (81% of PPO plans, 69% of POS plans, and 29% of HMO plans.  In addition, the percentage of workers now enrolled in high deductible health plans (deductibles over $1000 has increased dramatically (from 16% to 50% for businesses with 3-199 employees).  How

The above observations are sobering examples of how the general economy affecting businesses has a trickle down effect of what I would call a functional decrease in health care access. Functional because these patients on paper have access by virtue of their insurance but they do not seek care because of the associated costs.

Mobile health solutions speak to exactly these issues.  Why? Because adoption of widespread mHealth technologies can do many good things to the bottom line of payers which may trickle down to employers and then employees.  The lower cost of mHealth is intuitive by virtue of the fact that these technologies are relatively extremely cheap, many times requiring just a cell phone, and predominantly tools readily available (computer pad, PDA, proprietary mobile device, etc.).  It is something that is potentially so effective in reducing health care costs that it should be purchased by insurers (who can then potentially have the technology imbedded seamlessly in their patient portals) and then incentivized to patients with the prospect of either lower deductibles, premium rebates, or other means.  The mHealth promoting wellness, weight loss, or medication adherence will then decrease spending of healthcare dollars on the back end in the treatment of diseases by preventing them in the first place.

Of course not all mHealth technologies will result in cost savings and prospective studies would certainly assist payers and providers in assessing cost effectiveness.  Since cost effectiveness is something the mHealth industry is touting, the least that can be done is to demonstrate it in studies.  The EHR industry, much more accepted than mHealth, has yet to show this.

About davidleescher

David Lee Scher, MD is Founder and Director at DLS HEALTHCARE CONSULTING, LLC, which specializes in advising digital health technology companies, their partners, investors, and clients. As a cardiac electrophysiologist and pioneer adopter of remote patient monitoring, he understood early on the challenges that the culture and landscape of healthcare present to the development and adoption of digital technologies. He is a well-respected thought leader in mobile and other digital health technologies. Scher lectures worldwide on relevant industry topics including the role of tech in Pharma, patient advocacy, standards for development and adoption, and impact on patients and healthcare systems from clinical, risk management, operational and marketing standpoints. He is a Clinical Associate Professor of Medicine at Penn State College of Medicine.
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