The ‘tech attack’ of the healthcare market will change it into a consumer-driven market, concludes Oliver Wyman in a new report. This new market will be driven by three movements; the ‘quantified self’, ‘transparent consumer markets’ and ‘smart care teams’ that together stimulate innovation and lower the number hospital visits, resulting in a 40% cut in health care costs.
Management consulting firm Oliver Wyman recently released its ‘The Patient-to-Consumer Revolution’ research in which the authors describe a ‘new health market’ driven by the on-going investments in health technology. More and more healthcare tech entrepreneurs are entering the market, increasing the information available and transparency into healthcare provider options, costs, quality, outcomes, and value. According to Oliver Wyman, this ‘tech attack’ will disrupt the market as we know it and turn patients into consumers*, which it dubs the 'patient-to-consumer revolution'.
The new market, which will be 24/7, convenient, enhanced by technology, holistic and personalised that creates patients as consumers, will emerge in three distinct movements:
The first movement is the ‘quantified self’ which will raise the understanding of consumers when it comes to their own health status in real time. This movement is driven by ‘personalized apps, wearable sensors and social networks’ that encourage ‘life logging’ and behaviour change. The second movement is ‘transparent consumer markets’ that will empower consumers to make informed and value-based decisions. This will shift the basis of competition from reputation and referrals to price, value and outcomes. The third movement will come in the form of ‘smart care teams’ that will create new model for delivering healthcare with a focus on helping consumers to stay healthy and avoid expensive hospitalization and sick-care interventions.
Oliver Wyman states that these three movements together will encourage innovation, change the basis of competition, and contribute to better, higher value results, as well as increase the predictability and preventability of diseases and lowering the number of hospital visits. “We’ve known for some time that a healthcare model that waits for people to get sick and then treats them can no longer be sustained financially. But when we start to shift to a model based on prevention and wellness, remarkable things happen,” says Tom Main, Partner at Oliver Wyman and founder of Oliver Wyman Health Innovation Centre.
According to the research, the new market will lower costs by 40%, produce 10 more good years of living, and improve consumer experience by 300%. “The important thing to understand is how rapidly things are changing. Only a few years ago, the most advanced healthcare providers hoped to cut the cost of care by 20%. In the last year, they’ve told us that goal is not nearly ambitious enough,” says Main.
* The phenomenon of patients transforming into consumers in the more and more technology-driven world has also been picked up by other consulting firms. Just last month, consulting firm Strategy& released its report focused on the consumer-based healthcare in the US.