McKesson's Innovation Framework (PDF, 525 KB) identifies four forces that drive transformative innovation in health care: Business model, market adoption strategy, public policy and technology. Nowhere do those forces have a bigger impact in health care than in the digital health space generally and in the mobile health and medical applications market specifically.

Given the growth in mobile health and medical apps and along with it their potential to improve users' health status, we spoke with Joe Ganley, vice president for federal government affairs, about the factors driving the mobile health boom and the role that public policy can play in maintaining that momentum and keeping innovation on the right track.

How does value-based reimbursement affect the growth in mobile health and medical apps? 

Ganley: New payment models are shifting clinical and financial risk to consumers. Consumers are assuming more responsibility for the cost of their care, whether that's through higher deductibles or higher premiums. Either way, they need more information in order to make more informed decisions.

Mobile InfographicMobile health and medical apps can give them greater access to that information, whether it's comparing prices for health care services or tracking fitness activity as part of a health and wellness program or sending vital signs like blood pressure or blood sugar levels from home directly to an electronic health record at a hospital or doctor's office for assessment.

You're really talking about health care consumerism. What role does that play in mobile health? 

Ganley: What drives innovation in the rest of the world is consumer demand. Computers became better and smartphones became better because consumers—the people who buy those products—demanded new and better technologies and new and better ways of using those products. That's happening in health care now, and mobile health technologies are a great example of that. Patients want access to health information when and where they want it on whatever device they're using at the time. The boom in mobile health and medical apps is a response to that.

How can payers or providers use mobile health and medical apps as part of their VBR strategies? 

Ganley: A good example is patient adherence to medication. It's one of the things people talk about as being key to making value-based reimbursement work for payers and providers. Improved medication adherence can lower the cost of care by eliminating unnecessary trips to the doctor or hospital that result from patients not taking their medicine. A host of mobile technologies could be deployed to make sure people take their medications when they should. It could be a text message, an e-mail, an alert that pops up on my device—any one of those to remind me to pick up my prescription, refill my prescriptions or take my medicine. There's an enormous opportunity in the mobile health space for payers and providers in terms of making delivery and payment reform work for them and patients.

What role can policy play in fostering mobile health and medical app innovation? 

Ganley: Looking at it from the highest level, there is a significant relationship between government policy and the pace of innovation. You have factors like government funding in the form of grants or government-supported demonstration projects, both of which can accelerate the pace of innovation.

But the most important factor is whether public policy is predictable and stable. If policy is unpredictable and unstable, if it's constantly changing, if it's subject to the political whims of the day or the daily news cycle, if it depends on who controls which branch of Congress or the White House, that can significantly slow the pace of innovation.

On the other hand, if policy is predictable and stable, it's much easier for entrepreneurs and innovators and start-ups to attract investors who are willing to put their capital at risk. Knowing that their investment in research and development won't suddenly evaporate because of a new law or regulation encourages innovators. We don't want entrepreneurs with creative minds to shy away from making advances in health care because it's too difficult to navigate the regulatory environment.

The FDA recently released draft guidance (PDF, 550 KB) on what it calls “low-risk general wellness products” like mobile health apps that track fitness activities. The agency said it does not intend to regulate such products unless they're used specifically to diagnose or treat medical conditions. Do you think this approach will foster or hinder innovations in mobile health and medical apps? 

Ganley: The regulation of health care information technology should be risk-based. The regulatory focus should only be on the highest risk technologies. The FDA's approach to regulating health care IT has been consistent with that approach. The agency's draft guidance on low-risk general wellness products is consistent with that approach. We agree with the examples in the draft guidance that suggest what should and should not be regulated.

For mobile health and medical app entrepreneurs, that's good and bad. It's good if what they're developing is similar to the examples in the guidance. It's problematic if what they're developing has not been seen before and has no example in the guidance. That said, I still think you'll see much more innovation in mobile health because of the other forces I mentioned, such as value-based reimbursement and health care consumerism. That's the future, and there's no turning back.

Is there any way policy can be improved or changed in terms of fostering innovations in mobile health and health care innovation generally? 

Ganley: The use of guidance and examples, though helpful, is the very definition of an unpredictable and unstable regulatory environment. It leaves everything up to the enforcement discretion of the FDA. Some things are safe for now if they fall under the guidance and match the examples, but the FDA reserves the right to change its mind at any time.

A better approach, and one that we advocate, would be to update and amend the Food, Drug and Cosmetic Act, which gives the FDA the authority to oversee health IT, to require the creation of specific criteria to determine whether something is high-risk and, therefore, subject to regulation by the FDA as a medical device. That approach would be much more predictable and stable and certainly more comforting to health care entrepreneurs and innovators and their financial backers.

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McKesson editorial staff is committed to sharing innovative approaches and insights so our customers can get the most out of their business solutions and identify areas for operational improvement and revenue growth.

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