Interesting article published in the Australian today.Raises a...

Interesting article published in the Australian today.

Raises a few thoughts in my mind:

(1) Increased focus on digital record keeping from increased regulation and the possible revelations from the aged care royal commission

(2) Possible new market in the aged care sector as the aged care royal commission is more likely than not to highlight problems on, among other things relevant to Alcidion, the following:

- inability of the current systems used by some of the nursing homes and care providers to respond to respond to the Commission's request for information
- mismanagement of medication due to disjointed record keeping and poor handover between carers on different shifts
- care that causes unintended harm to elderly
- substandard clinical care due to imperfect information

(3) Ongoing merger and acquisition activity in the health sector 

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Tech giants to resuscitate health

EXCLUSIVE

SARAH-JANE TASKER

NEW PROVIDERS RAMP UP COMPETITION

A new generation of healthcare providers, includinginternational technology and retail giants, is expected to ramp up competitionin Australia this year, as the digital health sector matures.

It comes as the aged care royal commission, whichkicked off last Friday, shines a light on health carer shortfalls, poor recordkeeping and a lack of support for medical staff — problems digital technologiesare designed to address.

But investors and industry insiders have warned Australiandigital health companies are being forced offshore by red tape andanachronistic regulation, meaning local patients cannot reap the full rewardsof the industry’s know-how, even as the value of the global market soarstowards $US200 billion ($280bn).

Healthcare is one of the last major industries tobe significantly disrupted by advanced technology, and with Australia’s digitalhealth space maturing, investors are dipping their toes into this emergingindustry.

Chris Nave, managing director of Brandon Capital —Australia’s largest healthcare investor — said it was certain that technologyand data would be the mainstay of healthcare and patient management in five to10 years’ time. “As an investor, the unknown is trying to work out where theopportunities are to support innovation that truly does change patients’ livesand generates an investment return,” Mr Nave said.

“I think we are all still trying to figure that outand no one has cracked the code yet, including in the US. I think it will be animportant space and it would be a foolish healthcare investor not to take thesector seriously and to try to find opportunities to invest in.”

The digital health market is expected to reach$US206bn globally by 2020, driven mainly by the mobile and wireless healthmarket, and the Asia-Pacific is tipped to become a key region.

In his top predictions for the health sector for2019, Shane Evans, head of Minter Ellison’s national health industry group,said that the technology giants were set to lead disruption.

He said a new wave of care providers, includinginternational technology and retail giants, would enter the market and competeat a more sophisticated level.

But despite plenty of activity in Australia fromstart-ups in digital health, investment and regulation in the space is notkeeping pace and a wide-ranging report has argued for increased support to helpthe industry grow.

The report, Digital Health: Creating a New GrowthIndustry for Australia, also argues that the sector is not attracting theventure capital it needs in Australia.

It says one reason is that Australia isproportionately well behind other nations investing in this area.

“Many digital health start-ups are departingAustralia and moving directly into investmentreadiness programs in major marketsdue to the perceived lack of capital for digital health companies,” the reportwarned.

The new report, released by digital health businessaccelerator ANDHealth, revealed that the September quarter in 2018 saw morefunding pour into digital health than any previous quarter on record, withfunding exceeding $US4.5bn globally.

“The opportunity for Australia to capturesignificant investment, become a destination for inbound digital healthresearch and development, alongside becoming a world-leading exporter ofdigital health products, is significant,” the report concludes.

Digital health represents a technological changethat covers every aspect of the healthcare paradigm from prevention todiagnosis, management and treatment. It is also transforming the way frontlinehealthcare services are created, delivered and measured. There are five mainareas of digital health: telehealth, medical records, patient management,mobile health and connected devices.

ANDHealth chief executive Bronwyn Le Grice saidthat for Australia to succeed in digital health, there needed to be widespreadunderstanding that the sector went beyond health information technology andinfrastructure, and that digital health was not a subset of the medical devicessector.

“It encompasses much more than health software andelectronic medical records and has greater economic impact potential thanmedical technology alone,” the ANDHealth report outlines.

Brandon Capital’s Mr Nave said Australia’s digitalhealth sector was in its infancy. He said a lot of people were talking a biggame around digital health, with lots of noise and activity. Brandon Capital isseeing about two digital health businesses a week. “We are seeing bright,enthusiastic teams with interesting ideas but no real understanding aboutimplementation in the healthcare setting,” he said.

Mr Nave said for him as an investor to be attractedto a digital health company or product, it had to improve patient outcomes,provide information that changed a doctor’s treatment decision or lower thecost of healthcare.

The health investment expert added that one of thefundamental challenges for the emerging sector was getting paid. Government andinsurer systems were not set up to reimburse for the use of these newinnovations.

The ANDHealthcommissioned report raises concernsabout historic reimbursement frameworks and regulatory guidelines not beingoriginally set up to mould to new emerging technologies.

“Across many sectors, including healthcare,existing regulation often fails to keep pace with new technologies, leading toregulatory grey areas and limiting the rate at which the digital health sectorcan deliver transformative solutions,” the report said. “Feedback fromAustralian digital health entrepreneurs suggests it is easier to accesscustomers and sell their products and services overseas than in Australia, dueto perceived regulatory, reimbursement and market implementation barriers.”

Healthcare is seen as one of the last remainingmajor industries to be significantly disrupted by advanced technology but it iscertain that such disruption will happen at some stage in the future.

Minter Ellison’s Mr Evans said the emergence ofdigital healthcare solutions was a key sector driver.

“We are on the cusp of a new frontier in thehealthcare sector as digital service delivery to patients and care recipientsbecomes a much bigger day-today reality,” he said.

“In healthcare, the customer is increasingly incharge, demanding personalised, convenient care. They want the doctor, or eventhe healthcare provider, in their home, and they can because technology is anenabler.”