IoT Could Save Billions in Healthcare Costs Across the US and Europe
Published on 26 Sep, 2016
Despite its nascent stage of development and deployment, the global healthcare industry could leverage IoT to develop an affordable, accessible, and quality care ecosystem.
The adoption of technology and IoT-enabled products in healthcare is growing across the globe, with remote devices to monitor vital information like fitness trackers already flooding markets. A growing range of medical devices and wearable technology with effective remote patient monitoring could very well allow the point of diagnosis and treatment to shift from medical centers to a patient’s home.
A growing need for healthier lifestyles coupled with breakthrough technological innovation has been instrumental in boosting adoption, and the global IoT healthcare market is expected to grow from USD32.4 Bn in 2015 to USD163.2 Bn by 2020, a CAGR of 38.1%.
Besides the obvious benefits of real-time monitoring, remote diagnosis, and possibly automated emergency response systems, IoT-enabled medical devices could also save billions in healthcare costs simply through prevention and more efficient healthcare delivery.
IoT’s Potential Impact in US Healthcare Savings
One of the world’s biggest markets for healthcare services, the United States spends approximately 18% of its GDP on healthcare every year.
By improving adherence to prescribed therapies alone, the US could significantly reduce their healthcare spends. The effective deployment of IoT-based healthcare delivery technologies could help the US save well over USD 300 billion.
Chronic disease management, a key segment within the US healthcare landscape, is expected to realize more than USD 200 billion of savings, primarily driven by the elimination of redundant and wasteful expenditures.
The Internet of Things could also help reduce costs in several other disease types, such as:
|Disease State||Total Savings Opportunity||Commercial Opportunity|
|Remote Patient Monitoring||Cardiovascular disease, Asthma, and Diabetes.||USD 200+ billion||~ USD 15 billion|
|Telehealth||Routing & Psychological Care.||USD 100+ billion||~ USD 12 billion|
|Behavior Modification||Lifestyle diseases such as Obesity and Smoking Cessation.||Indefinitely large||~ USD 6 billion|
Source: Goldman Sachs
IoT’s Potential Impact in European Healthcare Savings
Among the world’s biggest growing healthcare markets, the European Union (EU) also stands to save billions by leveraging the Internet of Things in healthcare.
As per the French National Authority for health, IoT-based healthcare products could save about 10% (€ 47 billion) of in costs related to chronic disease management. Similarly, healthcare costs could drop by 80% (€ 53 billion) simply if patients adhere to their prescribed therapies and dosage routines, while the cost of remote hospitalization in the EU could be reduced by about 40% (€17 billion) by implementing connected medical devices.
Favorable Policies and Better Business Models Could Boost IoMT Market Growth
Growing awareness and the implementation of favorable policies has been a boon for the IoT- based healthcare market.
While developed markets like the US and Europe have witnessed significant uptake in IoT-enabled healthcare technology, emerging economies — where instances of ‘western’ diseases are growing — could be huge markets in the near future.
Constant technological innovation coupled with improving connectivity and infrastructure will gradually accelerate the adoption and deployment of smart devices. It’ll not be long before an intelligent network of connected devices will become commonplace, improving our quality of life the world over.