Apps mean primary care can be consolidated
New ehealth apps mean that the primary care sector in emerging markets can be profitably consolidated for the first time. We look at the potential, talk to advisers, investors and operators look and at what will be delivered in the next six months.
New apps like Babylon or Aetna’s iTriage app make it possible for big operators to make money in primary care for the first time. In Europe, the new breed of operators are stymied by competition from massive publicly-owned primary care networks, but this is not the case in Emerging markets. Here primary care networks barely exist with most patients heading straight for hospital casualty units. This means payors and governments are super-keen to build capacity.
One operator said: “The new apps change everything because they mean that you can build call centres staffed by doctors and nursing practitioners. So you can maximise efficiencies.” At the same time, the ability to simply download an app means that basic primary care delivery is accessible by many with no geographic limitations.
Such apps and primary care networks are already being launched. Dr Sulieman Al Habib, the largest Saudi private hospital chain, plans to launch an app linked to a new primary care network in March 2017. This will include telehealth and remote diagnostics. Yhe average Saudi visits a hospital 5 times a year and that four of those visits should be handled in a primary care setting.
Sven Byl, partner, healthcare at EY says the potential is enormous. “Put together a smart phone and a smart wand and then plug it into IBM’s AI product Dr Watson to do basic diagnostics” He points to what that Pharma Access, the Dutch development bank is doing across Africa where it is linking the devices to Mpesa, the mobile phone paying mechanism.
Our Analysis: Europe will take for ever to adopt this new model as it totally disrupts the existing public payor funded primary care network. We have seen huge resistance for instance from UK family doctors to the adoption of telehealth.
But its adoption in poor and middle income countries will be swift.
A big question is whether primary care will form a discrete sector in its own right or whether large hospital operators will dominate the new sector. Given the fact that standalone primary care operators of any size do not exist in Emerging Markets (aside from a few occupational healthcare networks in SE Asia and China) we expect hospital operators to dominate the delivery of primary care services.
Long-term, we think this trend calls for regulation. Primary care should be a gatekeeper to stop unnecessary and expensive acute interventions, as it is in the UK and the Netherlands.
The danger is that some hospital groups will be tempted to see primary care as a channel to grow acute patient numbers.
Even in Europe the need for this had barely been recognised. It is striking, for instance, that in Germany, large private hospital groups like Helios and Asklepios are allowed to buy family doctor seats and do so with the express aim of recruiting more patients!
We would welcome your thoughts on this story. Email your views to Max Hotopf or call 0207 183 3779.
