At a time when House Republicans have taken the major first step towards a replacement for the Hindenberg-esque socialized medicine experiment we know as Obamacare, the medical industry is only paying a paltry bit of attention to the politics of Capitol Hill.
Not that such a replacement doesn’t have incredible benefits for the healthcare industry — horror stories of hospitals carrying hundreds of millions of dollars in bad debt can be found through every state, as patients receiving Obamacare money find out that deductibles and co-payments make healthcare yet another facet of life in which there is no free lunch.
Rather, the biggest buzzword in healthcare, shared by Silicon Valley, is the digital startup. An adrenaline rush of investment, quadrupling to nearly eight billion dollars in the past half-decade, has tremendous potential to change the industry as we know it.
Take Alexa, the newest and flashiest product by Amazon. This artificial intelligence chip has found its way into a bevy of tech gadgets, ranging from car computer systems to television receivers to refrigerators.
Soon she’ll be a common feature of hospitals, helping to register patients, connect symptoms to diagnoses, and provide instructions for medical staff in case of emergencies. Her capabilities are slowly making a change to an industry that’s often hugely resistant to change, especially that of the digital variety.
Given the fields upon fields of red tape, laid down not just by Obamacare but by a byzantine collection of over-eager regulators in decades prior, it’s hardly surprising that few start-ups were willing to enter into such a landmine of an industry.
Yet not even a thousand regulations passed by an all-Democratic Congress can dampen the spirit of entrepreneurial capitalism. One major reason is the amount of money that can be saved by hospitals (and thus earned by innovators) each year.
While it’s notoriously tricky to declare absolute numbers about waste in any sector of the economy, estimates that one in every five dollars spent on healthcare (amounting to about three trillion dollars in the US alone) went to wasteful practices or procedures, such as incorrect, erroneous, or redundant treatment.
An AI chip like Alexa — who, unlike a doctor, cannot become tired, frustrated, or confused — can be a huge improvement and a huge opportunity all in one. Nor is the improvement solely the domain of blood pressure and surgery, but administrative aspects of healthcare, the costs of which can vary wildly from place to place.
The digital doctor revolution comes at a time when more and more patients are eager for a change. Perhaps it’s the all-too-frequent horror stories of doctors who amputated the wrong leg, or perhaps its the ubiquity of AI chips in our computers and smart phones, but in comparison to patients of just five to ten years ago, today’s patients are far more willing to wear sensors, report data, and take the advice of computers who never attended med school. Greater trust from patients as well as doctors has resulted in a boom of investment and R+D for e-medicine.
As with any technological innovation come success stories and losers. Just as the invention of the car spelled doom for the horse and buggy industry, so too does the digital healthcare trend look like bad news for the biggest entrenched companies like GE Healthcare or Phillips.
Whereas these companies enjoy healthy profit margins from, say, million-dollar MRI machines, tomorrow’s healthcare providers are able to analyze data that suggests that MRI machines aren’t as useful as previously thought.
This is not to say that investors should abandon ship — GE has a thumb in so many pies that any one sector is practically irrelevant; note also that their stock price has quadrupled since the recession — but that healthcare investment lies at a crossroads.
The ever-present search for tech “unicorns”, low-valued start-ups with tremendous potential, has shifted drastically to fresh names like Vivor, Careband, LifeBio, or Google’s sojourn into healthcare, Verily Life Sciences. The names may seem foreign today, but could be darlings of the market tomorrow.
The Republican plan to improve American healthcare depends first and foremost upon competition. But while their view of competition between insurance providers is good news for all Americans, it may not be the most important change to the industry in the years ahead.
As care changes from the human element to the AI element, the opportunities appear to be limitless for improving care and cutting down costs — so long as Democrats can’t rain down new regulation as profoundly as they have in years past.
~ Conservative Zone