Delivering Connected On-Demand Care: The Promise of IoT in Health Care

Saurabh Vyas | Michael Fierro

From smart virtual assistants like Amazon’s Echo to Google’s self-driving cars, our lives are increasingly connected through technology. Technology promises to transform our lives — the way we deliver and receive services, the way we communicate, and even the way we seek health care. Traditionally, health care has been a more or less reactive service delivered when there is a perceived or real need. Rapidly rising costs of care and the push towards value-driven reimbursement models has forced healthcare organizations to rethink their care delivery strategy and adopt a more proactive approach and help patients avoid need for healthcare altogether. Additionally, the availability of new technology and start-ups focused on healthcare have created new opportunities to improve care delivery and health outcomes. As health care catches up with other industries’ progress with consumer experience, the need for innovative care delivery will force organizations to think outside the box.

The advent of ultra-cheap sensitive sensors and rapid evolution of machine learning algorithms over the past decade has opened up a new front in healthcare powered by Internet of Things (IoT) — one that aims to bring healthcare from sci-fi movies into the real world. And it is already here. Connected remote monitoring devices such as glucometers and blood pressure monitors are already helping chronically ill patients better monitor their conditions. And in the near future, IoT products such as Google’s glucose monitoring contact lenses and home diagnostic devices from Tytocare and Scanadu, will bring the power of health care to each and every home in a more cost-efficient manner. Disruptive startups are rapidly revolutionizing health care, which poses key questions for traditional organizations — How will the processes be disrupted? Which technologies to bet on? How to leverage this increasingly connected world of IoT to deliver better and cheaper care? And how to strengthen the brand in this new age of experience-driven consumerism.

The pace of technology innovation is rapid and includes traditional and disruptive companies, and a wide array of stakeholders. While consumers are at the epicenter of much of this innovation, providers play a key role in enabling, using, and interpreting the information from the evolving connected healthcare world. The benefits of these technologies are numerous, as are the challenges to unlocking their potential.

Enabling Better Health Care: Benefits of IoT

IoT based technologies can be useful across the spectrum of care — from connected ambulances to transitional and chronic care. As sensors become smaller, diverse, and powerful, they promise to unlock a new age of data-driven real-time health care. Algorithms fueled by the power of machine learning and deep learning can help providers parse through immense amounts of data collected through the IoT devices to help make care decisions which can keep patients outside the hospital and improve outcomes, while reducing costs. Let us look at the three of the most important benefits.

Care in alternate cost-effective settings. The increased emphasis on value-based care and reimbursement models such as bundled payments continues to place significant pressure on hospital margins. To tackle the current slim margins of the industry, 2.6 percent for non-profit hospitals as of 2014[1], providers are exploring new avenues of savings to cut operating costs while improving quality of care and hence revenues. Numerous studies have pointed to the significant direct and indirect cost reduction from remote patient monitoring (RPM). Targeted RPM use can lead to 50% reduction in 30-day readmissions and almost 20% reduction in 180-day readmissions if combined with appropriate service delivery workflows.[2] Combined with workflow and organizational changes such as leveraging care managers for individualized management, these initiatives can significantly reduce costly ER visits among chronically ill patients and help hospitals avoid 30-day readmission penalties post-discharge. Both, legacy medical device companies like Medtronic and Philips and new entrants such as Qualcomm are trying to leverage their technologies to unlock major revenue potential, especially with potential expansion of Medicare reimbursement for such services under CONNECT for Health Act.

Dynamic care delivery with precise data. The patient response to treatment varies based on a variety of factors such as demographics, genetics, biological parameters, and compliance. Adoption of data-driven personalized medicine can help provide contextual health care, improve selection of appropriate therapies which can elicit optimal response, and also help to identify therapies based on response across cohorts. It is estimated that almost half of the patients in the US don’t take medications as prescribed, resulting in nearly $300B in annual costs from additional disease management and hospitalization needs.[3]

Several startups have begun to tackle this problem with IoT and algorithms to provide need-based interventions. For example, Proteus, a start-up based in Redwood City, CA has developed a FDA-approved ingestible sensor which is being integrated with drugs by Otsuka and Novartis. If approved for prescriptions, such smart pills will enable physicians to not only monitor compliance, but also get insights into patient physiological response to various drugs. The evolution of big data algorithms and artificial neural networks, which can learn from data and make decisions, will enable providers to provide personalized care delivery, precisely when the patient needs it.

Increase in patient satisfaction. As in other industries, one-touch access to information and proactive care delivery through IoT can enable health care organizations to provide patient experience catered to the unique needs and preferences of each consumer. This will be critical for health care organizations to improve brand perception and engagement in the face of a rise in consumerism. It will also have revenue implications as CMS (Centers for Medicare and Medicaid Services) and private players adopt key patient satisfaction metrics in value-based reimbursements. IoT technologies can be deployed to provide a seamless non-intrusive patient experience enabling care on-demand. For example, smart homes powered by sensors to monitor patient activity in home can detect falls and aggregators can transmit remote patient monitoring data to care managers, will allow seniors to live independently in their homes. Even in hospital facilities, sensors can be deployed to help patients navigate the facility better and track them through the patient workflow. In this regard, health care may be able to learn from Disney’s Magic Wristband, which is an example of context-aware IoT deployment aimed at improving guest experience.

Considerations for Unlocking the Power of IoT: Challenges Ahead

Health care organizations interested in unlocking the power of IoT need to address several challenges as they frame their delivery models. These challenges need to be considered during the strategic foundation of any service to ensure such technologies can be used optimally. The recent nationwide internet attack in October, which paralyzed well-known websites, was executed by tapping into unsecure IoT devices. Such massive hacks brought to the fore the dangers of mass adoption of IoT without sufficient security considerations. And in health care it is even more important when potentially Patient Health Information (PHI) can be compromised. As you think about how IoT can fuel your organization, let us first consider key challenges.

Redefining workflows and responsibilities. Data generated by IoT can help providers take better care of their patients, but it can also severely disrupt provider workflows in the form of frequent unnecessary alerts or flood of data with limited correlation to clinical outcomes. Multiple data points don’t always translate into better care and may actually reduce provider acceptance of such technologies. Organizations need to consider the impact on workflows early during strategy development and include the right stakeholders who will be involved in future state processes. Providers are wary of a deluge of data and alerts presented to them. To generate value, organizations will need to define specific roles and responsibilities around use of data to plan, act, and monitor patient care and clinical outcomes.

Building the right infrastructure. Health care organizations are still grappling with the meaningful integration of EHR and related tools with their daily operations. Many organizations have struggled to create the right technical infrastructure and secure network to accommodate provider devices such as phones or tablets for access to EHRs. Organizations focusing on meaningful use cases of IoT will need to conduct a comprehensive assessment of their internal capabilities including available technical resources, network structure, and implemented solutions, to understand the level of effort required to handle the additional technologies. Organizations will also need to evaluate requirements and make key decisions such as on-premise vs. cloud solutions, off-the-shelf vs. custom solutions. Such an assessment should be done earlier in the strategy development phase to avoid pitfalls of selecting the wrong objectives and platforms which can lead to organizational burnout, higher costs, and ultimately a failed IoT adoption.

Navigating the legal and compliance landmines. Closely related to the issue of clear accountability and improved workflows is the issue of malpractice lawsuits. Providers are hesitant to aggressively pilot and adopt many IoT technologies for fear of gaining a lot of data which cannot be acted upon with current mechanisms — what happens if your physician misses an alert out of hundreds which later leads to a major complication or even death of a patient? The potential malpractice lawsuits can quickly usurp any savings from implementation of such disruptive technologies.

Unlocking reimbursements. Private insurers like Humana, Aetna, and United Health have been aggressively piloting various technologies — from wearable devices such as FitBit to remote patient monitoring devices for diabetic and chronic heart failure patients. They are starting to reimburse providers for use of such technologies with demonstrated savings. However, one of the largest payers of patients who benefit the most, i.e. Medicare, is yet to expand its coverage. Evolution of Medicare will be a key determinant of how much actual impact the IoT industry generates beyond wellness.

Tackling security and safety issues. Vulnerabilities in remote patient monitoring devices, smart apps, or connected sensors in hospital facilities can increase risk of hacking attacks. Unique vulnerabilities are added as newer connections with entities, devices, etc. are established and adopted by the organizations. The potential impact of such security breaches can be significant as noticed by the 2015 breach at Anthem, affecting sensitive information of almost 80 million members and exceeding $100M+ in legal and security costs. Organizations will need to invest more to secure and safeguard the patient data from hackers who are constantly trying to explore loopholes to access PHI. The IoT report[4] from the Federal Trade Commission (FTC) recommends the following security best practices:

· Security by design — Building security into devices at the outset through risk assessments, minimized data collection, and pre-launch security testing of products

· Defense in depth — Implementing a strategy of multi-layered security to defend against a particular risk

· Monitor products — Continuing to monitor connected devices throughout their expected life cycles and providing security patches to cover known vulnerabilities

Addressing ethical ramifications. Widespread adoption of IoT combined with poor business practices can lead to ethical issues for healthcare organizations. For example, connected devices can be used to better understand a patient’s risk profile, predict utilization needs, and hence determine insurance rates. Although such insights can lead to lower premiums for the healthy, they can substantially increase the rates for people with multiple comorbidities, unfairly affecting people with chronic disabilities, pathological obesity, etc. The organizations need to adopt ethical approaches to service design and delivery, and transparently communicate their ethical considerations. They can build patient trust around benefits of sharing PHI for the community good, while outlining the measures being taken to protect and secure the data. Such transparency should also extend to adverse scenarios where a data breach related to PHI has been identified and damage control may be necessary. HIPAA, along with FTC ACT, regulates the permitted and prohibited uses of PHI and disclosures to patients and prohibits organizations from engaging in deceptive or unfair acts that can affect commerce.[5] It is important to understand that although many data elements do not fall under the purview of these regulations,[6] such as wellness tracking information or medical data sent to a person directly by medical devices, mobile medical applications, or cloud-based data exchange, organizations can take the necessary steps to go above and beyond the requirements of the law to build patient trust and hence engagement.

Charting the path ahead for IoT in health care

Health care organizations need to include a robust IoT strategy as part of their overall digital health strategy to account for the unique considerations which can make or break such services. Organizations should identify potential areas with maximum opportunity and impact to pilot certain initiatives and assess patient-provider adoption. Focusing on quick wins initially with clearly laid out benefits can help build traction within the organization. As value-based revenue models and healthcare consumerism drive a revolution in health care, organizations with the intestinal fortitude and a team of sponsors who shepherd an “Early Adopter” mindset will reap the maximum rewards. We will explore in detail in subsequent blog posts, how organizations can leverage IoT in specific areas across the health care spectrum.

Saurabh Vyas is a physician and delivery leadership Consultant in Slalom’s Silicon Valley office, specializing in healthcare innovations, performance improvement, and technology.

Michael Fierro is a Client Service Partner in Slalom’s Cross Market Healthcare team, specializing in healthcare strategy and operations; and regulatory compliance.

[1] Moody’s Investors Service, “U.S. Not-for-Profit Hospital 2014 Medians” report, September 2015

[2] Feasibility and Acute Care Utilization Outcomes of a Post-Acute Transitional Telemonitoring Program for Underserved Chronic Disease Patients”, (2015)

[3] NEHI Research Brief, “Thinking Outside the Pillbox: A System-wide approach to Improving Patient Medication Adherence for Chronic Disease.” NEHI, 2009

[4] “Internet of Things: Privacy & Security in a Connected World” FTC Report.




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Additional Slalom posts about IoT and healthcare.

· Without standards and new rules of engagement, there is no future for the Internet of Things by Ewa Jackson

· Fast forward: The Internet of Things in five years by Tyler Deutsch

· Security considerations for the Internet of Things by Sean Storer

· Telemedicine and the Perfect Healthcare Storm by Eric Quiñones

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