The Catastrophic Forcing Event For Digital Health

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Fusion by Fresco Capital

6 min readApr 30, 2020

I remember having a very frank conversation with my mentor in the aftermath of the .com crash, 9/11 terror attacks, and recession of early 2002. I was the CTO of a startup that he was the lead investor in and we were struggling to make sense of the “new normal” landscape. He said that the future promised to us by the .com boom years of 1995–2000 was just too early and that it needed a “catastrophic forcing event” to propel it forward. Indeed he was right, the events between April 2000 (.com crash) and April 2002 (the beginning of the recovery) helped lay the groundwork for the next 20 years of digital, SaaS, e-commerce, and the device + cloud boom.

The global coronavirus pandemic is the “catastrophic forcing event” that will propel forward advancements in digital health. Due to the aging population, an unprecedented number of billionaires looking to live forever (like Walt Disney), and technology advancements like mapping of the human genome, health care in general was due for massive investment in this new decade. Now with the COVID19 crisis, new opportunities in digital health in particular, will dominate the coming decade in many unforeseen ways.

In the rush to find effective treatments of COVID19, produce a safe vaccine, and augment the heroic work being done by the entire medical community in combating the virus, many governments have loosened a significant amount of health and pharmaceutical regulations. Less regulations and a massive investment in digital solutions during the pandemic will lead to a boom that will last well into the next decade.

Digital Health in the Next 10 Years

Digital Health solutions will fill many of the analog gaps in health care and research as well as open up brand new opportunities. Specifically we will see digital health in the next ten years:

focusing on wellness and prevention
changing care options
driving advancements in research & discovery
opening up new opportunities that previously were not possible

Wellness and Prevention

While medicine has made massive progress in the past hundred years, we typically treat an illness or disease after the diagnosis. In the past few years we have been inching our way towards prevention with a focus on wellness.

Prior to COVID19 the wellness applications were holistic in nature (such as Calm or Headspace to relieve stress) or specific to a function such as Eve (menstruation and sexual wellness), Noom (weight loss), or any of the variety of fitness apps/trackers out on the market today.

One of the prevention methods required for ending the COVID19 pandemic is to perform contact tracing and an “antibody” proof point. Only digital health solutions will make these prevention techniques possible at the global scale that is required (privacy concerns aside.) This is a shift to prevention.

Due to changes brought on by COVID19, future wellness and prevention solutions will start to integrate into your primary health care solutions. This is in stark contrast to today where your doctor, insurance company, and other medical professionals pretty much ignores your Calm, Noom, Fitbit, 23& Me, and other wellness data. The regulatory walls will start to come down in the aftermath of the pandemic and once the floodgate is open, there will be no turning back. Some digital wellness and prevention solutions will probably require a light regulatory approval, however, the solutions will be more effective and change the nature of your primary care.

Changing Care Options

Today your relationship with your doctor is tied to an annual physical (which tells you very little about your actual health) and visits when you are sick. In the United States due to COVID19, many of the restrictions on video and remote care have been lifted. While this may seem like a small change, if it lasts, it actually flips the experience around a lot.

A typical annual checkup visit to the doctor’s office when you aren’t sick consists of a short conversation about the obvious things (stop smoking and lose some weight), a short physical exam, and a bunch of tests and measurements (blood pressure, weight measurement, etc) and blood work. Then you go home and get a call or email from your doctor a week later about the results of the tests and any follow up that is required (like a prescription if your cholesterol is too high, etc).

Digital health will allow you to perform a lot of these tests at home or at another facility such as your supermarket before you go to the doctors office. For example some of the self diagnostics out on the market today are:

In addition, there are now solutions where you can get your blood drawn at home by an appointment and sent to the labs for your tests before your doctor’s visit. Your office visit is flipped as you will do the tests beforehand and have the conversation about it during your remote visit. Combine this with your DNA on file from a repository such as 23&me as well as all of your fitness and other wellness app data on file, your doctor, aided by machine learning AI based digital health data analysis, will focus on prevention and coaching rather than exams and reactionary measures. Since you can do the visits remotely, you will meet with your doctor 3–4 times a year for 20 minutes each and only come to the office when you are sick, however, the sick visits will be reduced since the doctor will be able to diagnose many of the illnesses you may have remotely (and via the tests done remotely.)

When you do have to visit the office, follow up visits will be reduced. Solutions already exist to send a nurse to your home or a remote visit with the exams done at home or locally.

The flipped care scenario is not possible without the recent loosening of the remote visit and remote/home diagnostics regulations. This is only the tip of the iceberg for digital health in the next decade.

Drive Advancements in Research & Discovery

During the .com era, there was a massive investment in laying fiber globally by venture backed telecom companies. After the catastrophic forcing event of the .com crash and 9/11 induced recession, all of those companies went out of business. But the framework was still there (i.e. the fiber cables) and during the next twenty years the amount of online solutions exploded. Without all of the fiber laid between 1995 and 2000, we would not be able to use our SaaS tools and Zoom with teams across the world and work from home during this pandemic. Nor would you be able to read this blog post.

In the scramble to find effective treatments for COVID19 and a scalable vaccine, doctors and medical researchers are using a variety of digital solutions. While Machine Learning and AI will not play a major role in solving this pandemic because the infrastructure isn’t there, that very infrastructure is now being built in the hope that it can help with the pandemic. It will lay the groundwork for an explosion of digital based research and discovery in the next decade.

Opening up New Opportunities

The combination of a loosening of regulations and the digital framework being built today to help fight the pandemic over the next year will open up a tremendous amount of new opportunities that we can’t even imagine today. Similar to when Steve Jobs got on stage and announced the iPhone, the CEO of Marriott and owners of taxi companies were not worried. Now look at the pressure on their businesses due to the likes of AirBnB and Uber.

Before the catastrophic forcing event of the COVID19 pandemic, the digital health industry was predominantly filled with regulated solutions, non regulated niche solutions, and early adopters in wellness and fitness apps driven by millennial behaviors. Innovation was road blocked by regulations or a lack of digital health infrastructure. With a loosening of those regulations, the laying of the digital framework being done as we speak, and an obvious massive investment in digital health in the next 18–24 months, we will be on our way to a decades long massive boom.