Why do we need digital healthcare?
By — Parag Agarwal
Editor’s note! 📨
Hi, I am Parul Aggarwal, founder of “The Health Club” — a community and career acceleration platform dedicated to people aspiring to build a career in healthcare.
Welcome to the inaugural edition of Healthcare Odyssey, your one-stop source for thought leadership in the Indian healthcare industry! We’re excited to bring you insights and perspectives from leading figures shaping the future of healthcare.
In this edition, we sit down with industry veteran, Parag Agarwal, who shares his valuable insights on the evolving digital healthcare landscape in India. Don’t miss out on his expert perspectives and stay tuned for more insightful content in future editions!
1. Getting to know you: Please describe your journey and key milestones into digital health.
I have spent my entire 19 year career in health tech, starting in Scotland where I graduated and eventually in India/Singapore where I studied and grew up. I have worked mostly with startups in areas such as medical technology, healthcare IT, community building and intuitive electronic medical record systems.
2. Setting the Stage: India has a very fragmented landscape, where healthcare supply and demand vary based on demographics and socioeconomic standards. With such an ecosystem in place, where do you think digital healthcare fits in, or more importantly, why do we need digital healthcare in India?
India is not a single, homogeneous country so digital healthcare will not find uniform adoption and certainly can’t be mandated top down universally on patients or providers. Digital health interventions are still a “good to have” instead of a “must have”. However, we still need digital healthcare in India because not everything can be solved by building more hospitals and medical colleges. To leapfrog challenges around accessibility, affordability and high disease burden, digital health interventions offer hope and data driven playbooks for policymakers to learn from and hopefully enact in their own state.
3. How has digital healthcare addressed the issues of accessibility and affordability from both systemic and operational pov?
Digital healthcare can solve accessibility by either reducing the traditional doctor patient ratio required for a particular specialty or disease burden, or by reducing the need to be physically present for care to take place, without compromising on patient outcomes in both cases. In terms of affordability, digital health can lower the price of care if cost of care is also reduced due to operational efficiencies. The other emerging area is in healthcare financing, loans for medical emergencies or even for discretionary spend in beauty, aesthetics etc. Digital layer reduces transaction costs around KYC, checking for credit and overall management of the loan.
At a macro, systemic level, real world data generated from digital healthcare is readily analysable (aggregated and anonymised) for policymakers, pharmaceutical and insurance companies so that they can churn out better policies, medicines and products.
4. Covid19 Impact: Since Covid19, apart from tele consultation, what are the other areas in digital health that have led to behavioural change and had an impact on the healthcare ecosystem and why?
Digital therapeutics as a service, marrying health coaches with wearables on a subscription model have grown rapidly. Also, rise in functional nutrition, fitness, wellness, preventive health, women’s health and personalised health such as genomic testing. Most of the benefits of these services have accrued to the middle class, urban population.
The reason for greater proliferation of startups in the prevention/wellness/personalised medicine space is a function of greater demand post Covid19, where everyone had a once in a multi-generation realisation of how precious health is, and were now willing to allocate a higher portion of their discretionary household budget on such solutions for themselves and family. Another reason was the already low health insurance penetration among the middle class, often also known as the “missing middle”, as government insurance programmes are not focused on them and this cohort also traditionally didn’t feel the need to spend their savings on insurance premiums. Post Covid, there was a simultaneous increase in both the number of health/life insurance policies sold (and for larger coverage amounts) and also spent on prevention and wellness. A lot of insurance policies themselves started partnering with startups focused on preventive health solutions to offer to their members, providing a further boost to the whole space.
5. Impact and Challenges: Digital healthcare has been existing for more than a decade, despite that there has been limited adoption and companies struggle to survive and mark a significant dent. What are the major challenges that the ecosystem has been facing?
While several entrepreneurs have been building in the last decade, since both supply and demand are fragmented on the B2B side — deal sizes are small (with very poor or negative margins) and sales cycles are very long. For startups to survive their cash burn and continue to innovate, I see a role for private equity to start creating mid to large sized companies with a basket of solutions instead of niche players, through mergers and acquisitions. Right now, the PE guys are only looking at hospitals, on the care delivery side. The launch and growth of ABDM should encourage them to also look at the health tech sector, and bet on the next 5–10 years.
6. Can you elaborate more on how ABDM will encourage healthtech?
ABDM will encourage digital health to expand at a much faster rate than the natural rate of growth of digital health in the last decade, simply because for the first time, there appears to be massive, irreversible political will to focus on healthcare. This means, there is willingness to engage, actively listen to the diverse, and tough to please industry stakeholders and do whatever it takes to further the mission. For example the Digital Health Incentive Scheme (DHIS), although it has had a slow uptake, I am sure there are other schemes, programmes in the works that will eventually drive the rate of growth and adoption. In India, health is a State subject, so the federal government can only set the policy framework, standards and technical infrastructure and hope that the States co-opt and participate. But I believe 5–10 years is a decent timeframe for the first set of the mission’s objectives to be fulfilled. We should not compare ABDM with the time it took UPI to become a success, for the reasons I have just mentioned.
7. Future Trends: What are the policy actions needed to harness the healthcare digital innovations in future in India?
Policymakers should encourage innovation through dedicated sandboxes for specific problem statements, with a clear path to procurement for successful innovators, measured objectively and transparently. This can happen both at the State and Federal level. The emphasis so far via ABDM has been on building the interoperability framework and underlying digital architecture and standards. The next step very quickly has to be exponential growth in the application layer, as without adoption, the infra is redundant.
8. A Call to Action: What are the most critical steps individual healthcare professionals can take to stay ahead of the curve in this rapidly evolving digital landscape? What advice would you give to young professionals looking to contribute to India’s digital healthcare future?
As a young individual, if you are passionate about this space, the earlier you start the more you can experiment as there are all types of companies, startups, MNCs that are trying to do something in digital health. The choices will continue to grow in the next few years, as healthcare is the last industry to get digitised, so it also has the most number of unsolved problems. When you are applying to these companies, put on the hat of the founder/entrepreneur/senior manager and proactively pitch how you can add value and why that particular problem statement is important to you. Don’t be afraid to make mistakes, to take risks, or to speak up. Every hire in a low margin, low adoption challenging industry like healthtech has to take ownership, either contributing to sales or product, directly or indirectly. Relative to other industries, there is no cushy job in digital health.
