In 2010, Naimish Patel took a chance on a promising digital health startup and sent his resume to Grant Verstandig, CEO and founder of the company that is known today as Rally Health. Patel became Employee No. 1 at Rally. Today he’s Rally’s Vice President of Business Development.
Since those early days, there has been an explosion of interest in digital health solutions, so we sat with Patel to get his thoughts on where the space is headed. The short answer? If you think it’s big now, it’s about to get a whole lot bigger.
It’s the End of Arrogance
At the time, Patel says, there was a growing interest in digital health solutions, but perhaps not enough awareness of how the health care system actually worked. “There were a lot of companies pitching devices, pitching apps,” he says. “Everyone was showing off the new, shiny thing they had built. For example, you’d go to something like South by Southwest [SXSW] and see a lot of cool-looking solutions, but no real business plans that would be sustainable.”
That seems to be changing, he says, as people realize that quick fixes are not enough. “I think the arrogance of people who thought they could just build an app and disrupt health care is going away. They’re realizing that health care is much more complicated than they thought.”
Part of this is the growing understanding that in health care, what counts is what actually helps people get — and stay — healthier. “What’s next is looking at actual outcomes,” Patel says. “Did people actually lose weight? Did they quit smoking? Do people go back to their old life in three weeks? Six weeks? A year? Ten years? That’ll be a longer story to tell, but that’s where we’re headed.”
A Cultural Shift Is on the Way
What caused this change? “The difference now is that everyone is really focusing on the consumer,” says Patel. “When I went to SXSW this year, the biggest line I saw was people lining up to learn about HIPAA [the 1996 Health Insurance Portability and Accountability Act]. That’s a huge change. Five years ago, no one knew what HIPAA was. People are realizing that you’ve got to be able to solve problems for the system to build a sustainable business. To disrupt health care overnight is not going to happen.
“There are some promising companies who are going to create a lot of disruption. Ultimately they’ll be good for the health care industry. We’ll see if these companies are going to be successful or not, but if they are, it’ll be a matter of time before people realize they can create digital-first health plans. So health insurance will go the way of car insurance solutions like Esurance. It’s going to be much more competitive, more about the consumer experience. People want a recognizable brand.
“This is going to influence both consumer expectations and employer expectations. Any customer who is going to buy a policy is going to expect a certain standard of digital interaction, because when they go to the App Store, they’re going to find all these solutions. And they’re going to wonder, ‘How come my health plan doesn’t have any of this?’
“The point is, we’re starting to see a cultural shift. People have more of an interest in health and wellness. They’re waking up to the structural issues we have in our society and how they affect people’s health. This is very positive, and we’re going to start to see better outcomes because of it.”
The Industry Is Growing Up
Ultimately, Patel believes, the health-tech industry is maturing. As he puts it, “We’re seeing the industry go from, ‘Hey, can we build a prettier-looking version of this?’ to ‘What are the outcomes?’ You’re seeing companies raise money based on results, which is very different from where we were five years ago.
“We are about to have a proliferation of direct-to-consumer solutions that will deal with every type of condition someone can have. Next will come a connection of these programs to other types of data. More people are tracking more stuff every day, and they’re generating all this data, but that data isn’t really useful by itself. You can’t just give your data to your doctor and have her do anything with it. But it does give us indicators, it does give us an insight into your lifestyle.”
You Need a Platform
Patel thinks health plans will need a platform to make sense of the digital offerings that already exist and the many more that are coming. “There’s all this innovation,” he says, “but for a health plan to take advantage of it, you need to have a platform where you can make the latest and greatest solutions available. You can’t just go out and pick apps and programs out of nowhere, because how are you going to promote them? How are you going to link them? The answer is to stop trying to build things you think consumers will use; instead, find a way to bring together the apps they’re already using. And to do that, you need a platform.”
“It’s kind of like the smartphone,” Patel points out. “Your phone has certain things it does, even without the extras. It’s a phone, it can get text messages, it can send email, it has a calculator, it can do all sorts of things without the extra apps. But it’s the apps that really make it personal to you, that make it indispensable in your daily life.”
What health plans need, Patel says, is their own version of an app store — and for that, a flexible platform is crucial. “They can take a platform like Rally and configure it to meet the needs of their members. Instead of spending internal development time building tools that can be purchased, leverage those resources to create deeper integration and improve your members’ experience by building apps that are exclusive to your health plan.
“There’s so many great things happening,” Patel says in conclusion. “There’s a whole world of innovation. If you thought it was big now, it’s about to grow exponentially over the next ten years.”