Millennials Become A Promising Target for Digital Health
Millennials’ need for quality experience, efficiency, and mental care provides an opportunity for the digital health market
By: Lavanya Kanneganti (LSM ’21)
In 2018, digital health value propositions made up 3 of the top 6 most funded propositions in the healthcare space following categories like personalized medicine, diagnostics, and drug development (rockethealth). Although the sector arguably has lower barriers to entry in comparison to drug development and personalized medicine, analysts are still referring to the space as “messy.” Part of the reason for this descriptor is that these companies have struggled to identify and engage the right audience.
Prior to 2012, it was easy to argue that the biggest audience for health-tech was the elderly population, as 90% of US healthcare spending was attributable to the top 10% of the health system users, which was filled with elderly citizens with chronic illness. In addition, the Medicare population became a booster for the success of a health-tech product early on because they were the dominant users of the healthcare system. However, Obamacare’s Medicaid expansion has allowed millennials to stay on parents’ health insurance until 26. Therefore, following Medicaid expansion, there has been an increase in millennials with healthcare accessibility. Moreover, the socio-cultural shifts in clean eating and self-care has encouraged millennials to regularly attend scheduled doctor’s appointments and invest in health technology. Thus, we’re seeing a dynamic and responsive market.
Companies like ZocDoc, CareDox, and Embleema have become rising stars in the health-tech space. Why? They’re focusing on the three main healthcare problems burdening millennials: improving patient experience, increasing efficiency of care, and aiding mental health.
Improving the Patient Experience
Studies show that millennials care more about the patient experience than baby boomers. Millennials are also more likely to research their doctor are take recommendations from their friends because they have expectations for their doctor.
This special interest among millennials has created opportunity for the creation of technology that can match patients to the correct provider based on compatibility or frequency of cases. It also removes the need for third party involvement to create the connections. And hence, we see apps like Somatix and ShiftDoc.
We’re also seeing rises in software development for in house learning systems. More concentrated for rare disorders or treatments without cures, these learning health systems are helping patients and their families find answers to their disorder by recording all experiences in an accessible bank. These systems also function as networks to build a community across these patients so that they may find ways to cope with symptoms or temporary solutions to their problems. Moreover, millennials are the ones that have become most responsive to these systems; they are the group most comfortable becoming active participants in online communities.
Increasing Efficiency of Care
Compared to baby boomers, millennials have less patience for inefficient processes like completing long intake forms or waiting in long processing cues. Serving this more time conscious market, ZocDoc has made scheduling a doctor’s appointment as easy as ordering coffee. ZocDoc’s offering of new patient-centric physician appointment scheduling and millennials’ need for quick online booking has created an attractive and accessible product. The product is encouraging care efficiency by lowering wait times, thus aiding in creating a more positive experience. Companies like CareDox, Embleema, and Swellbox have all taken a different approach to care efficiency. These companies are driving efficiency through the ability to transfer patient records across providers and between patients and their doctors. By incorporating blockchain network or a quasi-cloud concept, they’re reducing the need for heavy paperwork and unnecessary testing.
The increased emphasis on the patient experience and value for efficiency among this generation has partly led to the rise of sectors like telemedicine. Hospital systems are likely to also become more responsive to this positive feedback by incorporating virtual doctor/nurse systems into their care. We’re seeing this incorporation through text message care communication for medication and appointment reminders. There’s now also the potential for chatbots for quick question responses in care services.
Supporting Mental Health Treatment
As the most “anxious” and socially conscious generation thus far, millennials have developed higher prevalence of mental health issues. Compared to the baby boomer generation, millennials report a 5% higher prevalence of work place depression (Morneau Shepell). With 88% of millennials self-reporting as active on social media (PEW), part of the increased mental problems stem from higher accessibility to dopamine bumps. Therefore, we’re seeing the rise of apps like Calm, Headspace, and Moodpath. Given that Calm was named “The App of the Year” for 2017 by Apple, these apps are clearly getting strong public attention.
In tandem with the increasing prevalence of mental health issues in the millennial generation, members of this cohort have also become more willing to speak out about this issue. As a result, on the rise are messaging apps like FindMyDitto, which focus on connecting people with mental illnesses rising from insecurities of rare disorders.
Digital health and health tech often struggle to find a catalyst because of difficulty to integrate in medical institutions and because of difficulty to maintain consistent usage among its audience. It’s clear, however, that millennials are providing increasing impetus for growth in health-tech.
Although healthcare is the US’s fastest growing industry, it’s still rather difficult for young entrepreneurs with limited science education to enter. However, with today’s changes in audience response and clear opportunities for increased efficiencies and reach through user-centric app development, there are clear opportunities for student entrepreneurs to create significant change in the industry. And, here at WeissFund, we are excited to support and interact with startups founded by millennials who are seeing this opportunity to market to their generation.
Lavanya Kanneganti is a sophomore studying Biology, Finance, and Business Analytics. She has previously worked as a business and market analyst for many early stage health-tech startups and does research on medication pricing. She enjoys rooting for Kentucky basketball, watching movies, and trying unique ice cream flavors. Feel free to reach out to her at firstname.lastname@example.org.
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