How to Quantify the Economic Impact of Digital Health Solutions
Digital health offers tremendous potential to drive better health outcomes and reduce the cost of care. Yet the lack of rigorous studies and robust clinical evidence is often missing in today’s market, slowing adoption, and delaying progress. A recently published article echoes this sentiment, pointing out that, “Not every digital health platform is able to demonstrate either clinical robustness or the ability to reduce medical spend.”[1]
It’s time to introduce new standards
Going forward, the healthcare industry needs a new standard of clinical efficacy for digital health. The dearth of documented outcomes is the subject of a study that noted that despite the potential of digital health interventions to make a difference in care and costs, “…the evidence regarding cost and effectiveness of digital tools in health is scarce and limited.”[2] Health plans need to know what they are getting so they can strategize accordingly – especially in the current economic climate.
High-impact healthcare benefits: When every dollar counts
Access to affordable quality care has been a persistent problem, and it’s just getting worse. Over time rising premiums have ended up hurting more than helping. Plan designs to encourage members to be more responsible with their health by putting “skin in the game” (reducing duplicative tests, ER visits, etc.) had the unintended effect of deterring people from seeking treatment. Few people can afford the typical multi-thousand-dollar deductible, which means that people can’t afford to pay out of pocket for preventative and wellness visits.
The perfect storm: Pandemic + inflation
We are now dealing with inflation on top of the fallout of the pandemic, creating an extra layer of pressure on the need for more affordability in healthcare. During COVID-19, people didn’t get regular care, screenings, or treatment for chronic conditions. Two years on, inflation and a possible recession mean a higher cost of living. According to a recent article in the New York Times, “Nearly four of 10 Americans said they had put off care in 2022 because of cost, the highest number since Gallup started asking people about delaying care more than 20 years ago.”[3]
More layoffs are looming across the nation, leaving higher numbers of people uninsured. An estimated 15 million people will lose access to Medicaid this year. [4] Out-of-pocket costs keep going up so people skip seeing doctors and ration their meds so that they can pay their rent or electric bill.
Groundbreaking study provides much-needed evidence of savings
Health plans can help by offering solutions that give their members the power to take control of their health. When chronic conditions are managed effectively, we can reduce costs while improving outcomes, no matter what is happening with the economy.
Research recently presented at ISPOR analyzed real-world data of users of Dario’s digital health platform in a first-of-its-kind study that applied highly rigorous matching methodologies to determine economic impact.
A third party collected data from Dario members using the platform to manage type 2 diabetes as the starting point. User data was matched to corresponding claims and lab data for 2,445 Dario users and compared against the data of 7,334 matched non-Dario users. Propensity-matched research methodologies were applied to conduct analysis on predefined primary and secondary endpoints.
Results you can trust
The study results demonstrate the industry-leading economic impact of Dario’s digital health solution across total healthcare costs, providing clear evidence that a whole health approach to managing chronic conditions like diabetes delivers cost savings:
- 9.3% reduction in all-cause healthcare resource utilization (HCRU)
- 23.5% reduction in hospitalizations
The study offers rich insights derived from careful and thorough analysis.
Significant economic impact
Diabetes is expensive. Recent research shows that employers spend over $175 billion annually on direct pharmacy and medical costs for members living with diabetes. People with diagnosed diabetes incur average medical expenditures of $16,752 per year, of which about $9,601 is attributed to diabetes. On average, people with diagnosed diabetes have medical expenditures approximately 2.3 times higher than what expenditures would be in the absence of diabetes.[5] Given this reality, reductions in HCRU and hospitalizations translate directly into lower costs for members living with diabetes.
[1] How digital health programs can reduce employer medical costs
[2] The cost-effectiveness of digital health interventions: A systematic review of the literature| Frontiers
[3] Higher Bills Are Leading Americans to Delay Medical Care | New York Times
[4] Millions set to lose Medicaid coverage as pandemic-era rule expires | NBC News
[5] ADA | The Cost of Diabetes