Collaboration is Key to Digital Health Solutions

The home care space has recently seen a number of startups take risks and bet on the role of digital solutions in improving seniors’ quality of life and independence at home.

But digital solutions need to be designed and rolled out effectively by stakeholders working together to realize their full potential, according to a recent report from HealthXL, a digital health collaboration platform, and AARP.

Here are some key takeaways:


Understand externals

Home Hero, a home care startup that raised millions but ceased operations in early 2017, serves as an example of the need to understand the market dynamics of existing and entrenched solutions, the report indicated.

Long-term home care players have strong relationships with various inpatient and outpatient facilities that are difficult to compete with, Home Hero Co-Founder and CEO Kyle Hill indicated in an essay he penned when the company closed. This made it tough for newcomers to break into the broader health care system and build business with existing health care providers outside home care.


Conversely, CareLinx, which provides a matching service for families and caregivers and was acquired by Generali Global Assistance, benefited from aligning to revenue models, according to the report.

“The main difference between our model and their model is we’re a marketplace, whereas they are traditional agencies with their own tech staff,” CareLinx CEO Sherwin Sheik was quoted as saying in the report.

Diversify revenue

Startups creating senior care solutions face a range of issues, including coverage limitations for newer digital health solutions and the constraints of consumer purchasing power.

The limited coverage by Medicare and Medicaid is compounded by digital health players’ lack of strong evidence for cost savings, the report noted. And though solutions like remote monitoring can help seniors deal with conditions in their own homes, their high price points can put them outside the direct-to-consumer model. This, in turn, can lead solutions to test at-risk revenue models, according to the report.

Instead, startups should implement a mixed business model, one that combines multiple payment models, according to the report.

“Start-ups may not appreciate that while individuals 65+ years of age have Medicare, they also buy supplemental coverage,” Lee Shapiro, managing partner of 7Wire Ventures, said in the report. “We see the Medicare Advantage market as very attractive—and a place where the interests of consumer, provider and plan can be highly aligned.”

Cross collaboration

Stakeholders from all industries—startups, regional provider systems, non-health industry players—will have to come together to scale new models of aged care, the report stressed.

It also highlighted several angles to consider. For example, smart living and home care solutions have often focused on more traditional services, such asSan Francisco-based home care startup Honor  and New York City-based Hometeam. Both companies offer traditional private duty services, with a focus on their technology capabilities.

However, a more inclusive solution in the smart living category could include other service startups, such as Nest, a subsidiary of Alphabet (NASDAQ: GOOG) that produces programmable, sensor-driven, self-learning devices for the home such as smoke detectors and thermostats, and the meal delivery company Blue Apron (NYSE: APRN).

“As average life expectancy continues to increase, I believe the most successful businesses will be built at the intersection of health and other industries which affect the +65 population’s day-to-day quality of life—transport, housing, finance, travel and lifestyle/wellness,” Christian Seale, general partner at Startupbootcamp Miami, said in the report. “Select point solutions will undoubtedly find success, but the real winners will be those that improve, extend and promote an active, healthy and fulfilled life.”

Written by Maggie Flynn

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