The 2025 Global Healthcare Landscape

The global healthcare industry is in a phase of rapid transformation, and will continue to be so over the next decade. Several factors are responsible for this revolution, and for changing the traditional ways in how people are treated and cared for. The Frost & Sullivan analysis Vision 2025 - The Future of Healthcare, has led to some interesting insights in to the next decade of healthcare.

Why healthcare expenditure will continue to rise?

It is due to three specific factors: disease profile shifts, demographic shifts, and economic shifts, which are explained below in detail.

Disease Profile Shifts

Non-communicable diseases are set to dominate the next decade. It should hardly be a surprise, as chronic diseases such as diabetes and cardiovascular disorders are now known to affect people irrespective of economic status, age, gender, or urban/rural location. Non-communicable diseases are already responsible for more than half of the deaths worldwide, and this share is set to increase by an additional 5 per cent by 2030. Europe is projected to be the only region where share of noncommunicable disease deaths will fall by 2030. Remarkably, Southeast Asia, earlier recording the largest number of communicable disease deaths after Africa, will see its share of communicable disease deaths drop by about 4 percent.

Non-communicable diseases, especially chronic ones, result in recurring healthcare costs, sometimes for a lifetime (for example, diabetes). In contrast, communicable diseases may not necessarily result in repeat expenditures. In essence, rise in non-communicable diseases is set to increase healthcare expenditure.

Demographic Shifts

While there are several interesting insights from studying how the 2025 world population of 8 billion would evolve from today, the ones most relevant to healthcare are related to the elderly group. Understandably, the elderly age group (60 years and above) requires the most healthcare resources and hence forms the most expensive age group from a healthcare industry perspective. In 2015, this age group accounted for 12 per cent of global population, but by 2025, its proportion increases to 15 per cent. A 3 per cent rise may not seem to be much, but when actual increase is computed, it amounts to 325+ million (rough estimates). Another worthy statistic is the fact that there would be more than a billion people in the elderly age group by 2025. Naturally, healthcare expenditure would rise with the proportion of the elderly.

Economic Shifts

Estimates indicate that the global healthcare expenditure will rise to USD 13.92 trillion by 2025, from the current USD 8 trillion approximately. The major share in this increase, however, will not be from the developed regions of North America or Europe. Interestingly, if ranked by growth in healthcare expenditure, expressed as percentage of Gross Domestic Product (GDP), Africa would emerge at the top, followed by Asia-Pacific. The highest regional expenditure on healthcare would still be in the developed regions of North America and Europe, but the growth in expenditure would be higher in Africa and Asia-Pacific.

Developed regions already spend a significant share of their GDP on healthcare. Regions of Africa and Asia- Pacific on the contrary spend significantly lesser amounts on healthcare, and hence, will have to improve spending to meet the health needs of their citizens. This will be driven by growing populations, and a gradually increasing share of the elderly amongst that population, along with rising incidence of chronic diseases. For example, India- the second largest country by population, has already made public its commitment to increase public healthcare spending from 1 per cent of GDP to 2.5 per cent by 2020, which still may not be enough.

How stakeholders are changing their approach in delivering care?

Unsurprisingly, rising healthcare costs have resulted in efforts to control them, and if possible, to reduce them significantly. Major trends in today's healthcare industry reflect such efforts.

Let us consider the changing approach to personalization of care. Knowing that a one-size-fits-all approach does not always work and can result in delayed recovery and increasing costs, personalization in the form of precision medicine and custom care plans is now becoming important. In fact, the entire focus is now increasingly shifting toward diagnosing diseases earlier, monitoring them better, and even preventing them when possible. Increasing adoption of technologies that improve available information (for example, wearables) and aid in care coordination (for example, EHR) reveal intentions to hasten patient recovery, and reduce associated costs. Of course, reimbursement pressures also exist, with payers incentivizing the move toward value-based care - where outcomes are paid for, but not individual episodes or procedures.

How will evolving technologies support this transformation?

Frost & Sullivan analysis has identified 18 key technologies likely to make a significant impact on healthcare by 2025. Of these, three are discussed below.

Artificial Intelligence

While human capacity to analyze and make deductions is limited in terms of the volume of information that can be processed quickly. Artificial intelligence makes this process faster by several degrees and is far more efficient than humanly possible. IBM's Watson, for example, can read 40 million documents in 15 seconds. Some of the applications currently being developed are assisting physicians and radiologists to make accurate diagnoses, and predicting which potential therapeutic candidates are most likely to work as efficient drugs.

Robotic Care

Robots have been in healthcare for a long time now - the Da Vinci surgical robot is a case in point. However, several other robotic applications are emerging, and we should expect a lot more robots operating in the healthcare space by 2025. Examples include telepresence robots allowing the doctor to 'move around' and examine patients while being seated at his or her computer at a distant location, or robots that help hospitals internally transport their pharmacy supplies, lab samples, patient food, clean or soiled linen or even trash, all by themselves. Then there are the patient and elderly care robots that help in lifting patients from beds to wheelchairs and back. Finally, robots can also play a role in paediatric therapy for phobias and also as distractions.

Medical Tricorder (a Diagnostic Device)

Taking cue from the device popularized by the Star Wars franchise, efforts are aimed at developing a hand-held portable diagnostic device that can scan the human body and diagnose their ailments within seconds. While the fantasy version of the device could do this, current efforts are more realistic in their approach. With the winners of the USD 10 million Qualcomm Tricorder X Prize competition set to be announced this year, we could expect such devices to be commercially available by 2025.

What changes will be brought about in healthcare

2025 Healthcare Themes - Frost & Sullivan analysis has identified 10 crucial themes that stakeholders need to adapt by 2025. Of these, three are discussed below.

Anytime, Anywhere Care

In 2025, any health service can be accessible for a patient at any time, and anywhere - regardless of the time of day, official working hours, holidays, rural or urban location, at home, workplace, or public areas. This will be enabled by several technologies including the already known telehealth mode of care. Essentially, anyone could have their healthcare queries solved, assessed for early diagnosis of diseases, or even be treated immediately, while saving overall healthcare costs associated with delays in seeking care.

Error-free Care Delivery

Current healthcare system still deals with issues such as misdiagnoses, delays in rare disorder diagnoses and prescription fill errors, amongst others. The care delivery of 2025 will be free of such errors, enabled by several technologies such as artificial intelligence.

Automated Healthcare

Automation with the help of robots and other technologies such as the Internet of Things, Big Data analytics, and artificial intelligence can help to not only reduce costs, but also improve the efficiency of operations, and help improve patient health outcomes.

Upcoming Business Models

Several new business models aligned with the transformation of the industry are being adopted by the different stakeholders - manufacturers, healthcare personnel, providers, support services and even non-healthcare entrants in the industry. Consider 'affordable mass customization' using 3D printing that caters to personalization needs of today's patients with very low manufacturing costs. Another notable model is that of 'shared economy' - an example is of busy radiologists routing medical image-reading requests to other radiologists in the network, helping efficiently manage workloads without compromising quality or time required to service the request.

Conclusion

The convergence of technology, themes, and other factors in the market have led to emergence of several billion-dollar opportunities in every sector of healthcare - pharmaceuticals and biotechnology, medical technologies, medical imaging equipment, in vitro diagnostics and healthcare IT. Frost & Sullivan identifies several of these in its analysis. A select few examples from the pharmaceuticals sector include immuno-oncology checkpoint therapeutics, 3D printed drugs, and implantable drug delivery systems.

In summary, the transformation of the industry and evolving technologies are leading to several growth opportunities, stakeholders need to assess these changes, self-assess own position along the path to 2025 goals to determine what actions they will need to undertake to achieve those goals