The U.S. healthcare system faced steep challenges in providing effective care and outcomes to older patients even before the COVID-19 pandemic hit. Now, the stakes have become even higher.
The virus outbreak has stretched U.S. healthcare systems unlike any crisis in the past, and exposed critical shortcomings of their business models that have built up over decades. These include an inability to provide care services during lockdowns and the prohibitively high cost of care, coupled with narrow penetration of health insurance among the elderly. The latter caused out-of-pocket expenses to skyrocket, thus discouraging patients from seeking care. A glaring lack of capacity to handle outbreaks didn’t help matters as COVID-19 infections spread. Filling these chasms will require new business models and technologies driven by a long-term vision.
However, like every crisis, this one has a silver lining. It forced providers to quickly expand their use of technologies such as telemedicine to manage the influx of patients and maintain care continuity. At a time when the healthcare sector was inching toward an on-demand model, the pandemic served as an accelerant for technologies such as sophisticated remote monitoring that make telemedicine, virtual and at-home care more effective and accessible.
For the elderly, this new direction, while intimidating, is the right way to go; on-demand offers remote access to diagnostics, doctor appointments, and primary care — immediately and at appreciably lower costs. But before on-demand can truly take hold, players across the care value chain must understand how the idea of aging has evolved, and must shape treatments and interventions accordingly.
COVID-19 has highlighted the crisis in elder care
Although older adults outspend all other demographics on healthcare, elder care in the U.S. has not kept pace with the steady growth of elderly patients.
High out-of-pocket spending, even under Medicare plans, spurred by fewer people with private insurance coverage, makes some older patients less willing to go to a hospital to be tested or treated. Costs for COVID-19 treatments are also expected to be high for seniors. According to some estimates, out-of-pocket healthcare spending will rise as a share of average per capita Social Security income from 41% in 2013 to 50% in 2030.
Meanwhile, the U.S. market for home care, which is expected to grow from $100 billion in 2016 to $225 billion by 2024, is facing a shortage of registered nurses. This has wide-ranging ramifications for the system as a whole, but especially for the delivery of elder care. At a time when 80% of Americans have expressed a desire to live in their homes until they die rather than in a long-term care facility, these challenges may prevent healthcare providers from helping that to happen.
The pandemic has, unsurprisingly, pushed care providers to increase their spending on healthcare IT and reduce the timelines for digital implementation. But technology is just one side of the story. As the new healthcare landscape takes shape across the U.S., healthcare providers must restore consumer confidence that has been shaken by the pandemic. This will require an approach that is human-centric at heart and technology-driven in execution.
Transforming how elder care is delivered
By investing time and money to better understand the perspective of older patients and leveraging technology to improve care delivery, providers can transform the patient experience. Our study, “The Future of Aging,” found that contrary to some stereotypes, older adults are a vibrant, culturally savvy cohort with unique needs and desires. That study and much more research suggests that engaging with the elderly to understand them beyond their diets and exercise requirements will let caregivers design human-centric treatments delivered via the right technological tools.
Three levers: digital, platforms, human-centricity
Care delivery is undergoing a massive change, driven mainly by the need to expand access to care and greater tech adoption by providers in areas such as automation, cloud and mobile. As this transition happens, it’s becoming clear that the industry is slowly steering toward a platform-driven, on-demand business model (read our white paper, “Rethinking Health Plan Business Models for the Emerging On demand Digital Economy,” to learn more).
This model is ideally suited to the needs of the elderly. Apart from reducing the anxiety associated with visiting a hospital, this approach could make care less expensive for those who pay out of pocket.
Digital technologies can help build the necessary foundation: platforms that help virtualization of care at lower cost and with a human-centric approach. We recommend that providers take the following steps to become future-ready:
1 Accelerate digital adoption.
COVID-19 has shown how digital can be used to make care better and more accessible to the elderly. Early in the crisis, several academic medical care centers started using telehealth to remotely triage infected patients and even to monitor the sickest intensive care unit patients, highlighting the ready-made nature of telemedicine for providing advanced care remotely.
This underscores the need to accelerate the adoption of technologies, including cloud, machine learning and automation, that can expand the reach and accessibility of hospital care to the suburbs and rural areas. Importantly, the use of digital technologies had been growing among care providers even before the pandemic. Though telemedicine has surged in popularity since it is less popular among patients over the age of 55. The emerging field of gerontechnology holds promise in this regard.
2 Leverage emerging platforms for affordable and accessible care.
Enabled by digital, emerging business models promise to deliver primary care, diagnostics and other services closer to patients’ homes and at lower cost. Care systems that have embraced this approach have seen huge cost savings already. Direct-to-consumer lab testing, meanwhile, has gained popularity in the U.S, with COVID-19 heightening interest in this approach. How we see this newly realigned care delivery model is illustrated below.