The global market for telehealth and telemedicine, estimated at $13.2 billion in 2011, is expected to exhibit a compound annual growth rate (CAGR) of 14% from 2011-18 to exceed $32.5 billion by 2018 (see Figure 1).
Telehealth technologies are proven to expand the outreach of quality medical care, reducing healthcare expenditure and optimising available provider resources. The growing burden of patients with chronic conditions and an increasingly large aging population are the other key issues promoting adoption. The accelerated growth of robust telecommunication technologies, increased adoption of related healthcare IT solutions, and investment by both companies and governments are also contributing to the market’s double-digit growth.
Tackling healthcare challenges
Limited access to adequate medical care, aging patient populations, increasing costs and the shortage of medical professionals continue to put a burden on the healthcare system. Integrating telecommunication technologies to deliver remote patient diagnosis and care, as well as preventive care services, allows health systems to overcome these limitations and efficiently manage the provision of medical care.
To take advantage of its considerable potential, governments across the world have begun to adopt and support the implementation of telehealth and telemedicine as an integral part of their healthcare delivery policies.
Confidentiality, data security and improved reimbursement
As with most technologies related to healthcare IT, data security and privacy concerns are key impediments to the adoption of telehealth and telemedicine solutions and services. Inadequate data security could lead to inaccurate diagnosis, and erroneous prognosis and prescription. These issues impact the confidence of patients and telemedicine professionals in information and communication technology (ICT), reducing the scalability of telemedicine solutions and services.
Limited reimbursement support for the adoption and implementation of telehealth technologies significantly deters investment by providers as well as vendors. Most reimbursement policies proposed for telehealth solutions or services are inadequate for covering services rendered by remote practitioners, community first responders or other providers.
The mHealth solutions market
The global market for mobile health (mHealth) solutions was valued at $1.2 billion in 2011 and is expected to grow at a CAGR of 39% to reach $11.8 billion by 2018 (see Figure 2). It is the fastest-growing segment within the telehealth and telemedicine market and involves the use of mobile applications and devices to monitor a patient’s health remotely. This substantial growth is attributed to the widespread use of mobile phones that allow faster, easier and broader access to healthcare services. mHealth is used in patient consultation, patient monitoring and drug adherence programmes, among others, and allows physicians to remotely monitor patients by accessing their records and making decisions remotely.
Telehealth and telemedicine: market overview
Telemedicine refers to the provision of treatment through telecommunication-enabled healthcare delivery models, while telehealth encompasses the provision of tools for disease prevention in addition to remote healthcare treatment. Therefore, the telemedicine segment can be referred to as part of the broader telehealth market.
An ever-increasing patient population is seeking access to high-quality care, boosted further in the last decade by the growing aging population and the rising prevalence of chronic conditions. ICT allows providers and health systems to tackle these challenges through more efficient use of a limited number of medical professionals, reducing data losses and the time taken to deliver healthcare.
Initiatives and expenditure by public health systems have been most significant in Europe compared with the US or Asia-Pacific (APAC). However, the US and developing countries in APAC are now focusing on building technology infrastructure and pushing private investments or public-private partnerships in order to implement telehealth networks.
The rapid penetration of robust telecommunication technologies in the past decade has boosted the adoption of telehealth models for the delivery of medical care. Among key telecommunication technologies, the increased penetration of broadband networks, both fixed and wireless, has been at the forefront of this rapid growth, enabling economy-of-scale models.
Rapid growth of healthcare IT technologies to drive adoption of telemedicine solutions
The rapid digitalisation of data and workflow in the healthcare industry will assist the uptake and implementation of telehealth care models. The adoption of interoperable hospital information systems and medical imaging information systems has witnessed considerable growth. These technologies enable the implementation of integrated telemedicine solutions and services, and make the capture, storage and exchange of data between providers easier.
Integrated electronic health records (EHRs), picture archiving and management systems (PACS) equipped with clinical decision support systems, and pharmacy management systems all enable the efficient management of remote diagnosis and faster clinical management. Furthermore, the adoption of health information exchange standards and technologies enable providers to enhance the scope of their telehealth networks.
Technology investment to drive telemedicine market growth
Governments and public health systems have spurred investments in the past decade to capture the substantial market potential offered by telemedicine technologies. Companies from multiple sectors have also invested in the form of R&D, venture capital, consolidation activity or strategic partnerships to enter or expand their capabilities in telehealth solutions and services.
The mHealth market has been an area of focus for venture capital firms. According to mobiThinking, an online resource for mobile technologies, venture capital investments grew from $209 million in 2010 to over $356 million in 2011 at a CAGR of 70%.
Most reimbursement policies proposed for telehealth solutions or services have limited scope and are also inadequate for covering services rendered by remote practitioners, community first responders or other providers. For example, although Medicare includes reimbursement for remote face-to-face services for the treatment of diseases such as end-stage renal disease and diabetes in the US, it does not offer reimbursement for many other indications. Such inconsistent and incomprehensive reimbursement policies continue to deter market growth.
Additionally, in the US, there is limited scope for the coverage of preventive medicine strategies. A significant part of telehealth solutions and services, particularly pertaining to mHealth, are primarily deployed to assist in consumer-centric preventive healthcare.
The growth of the telemedicine market in emerging countries
The adoption of telehealth models for healthcare delivery in emerging countries is limited by the under-penetration of broadband networks. Most developing countries, such as India, China and Brazil, have exhibited significant growth in terms of their broadband technology user base. However, penetration levels in emerging countries, mainly in APAC and Latin America, are still significantly lower than those of developed countries. Regional disparity in terms of penetration of ICT technologies is higher in Africa than in the US or Europe.