Healthcare purchasers are investing more in digital health technologies and are committed to growing the space, according to a survey from the Peterson Health Technology Institute (PHTI), an independent reviewer of digital health technologies.
In its first annual report on the state of digital healthcare purchasing, PHTI surveyed 332 health plans, employers and health systems to determine what criteria they use to select digital health technologies and what they’re looking for in a digital health solution.
PHTI partnered with the National Opinion Research Center at the University of Chicago to conduct the survey. Employers and health plans were slightly overrepresented compared to health systems. The responses to the survey were collected between July and August 2024.
The group found that, on average, 75% of health plans, employers and health systems have grown their digital health budgets in the last two years and plan to have a bigger budget next year. The overwhelming majority of organizations implemented digital health technologies to achieve cost savings or cost efficiencies compared to standard treatments. All sought to improve clinical care outcomes, increase efficiency and increase access to care.
The most important factor for selecting a digital health technology was having a proven track record, the report found.
About 40% of purchasers had invested in three to five digital health technologies, while 43% of purchasers said they have invested in six or more. Companies are contracting with digital health solutions to treat specific clinical conditions that most affect their populations, with diabetes, mental health, primary care, cardiac care and obesity as the most common areas of focus for treatment.
Employers stick to a standard set of criteria to evaluate digital health purchases, while about 55% of payers and health systems said they use standard criteria to evaluate their tech purchasing decisions. Of the half that use standards, 99% said the standards were internally set criteria as opposed to an external framework for determining value.
Health plans, employers and health systems reported that they engage in value-based contracts with digital health technologies. Most health plans had direct contracts with digital health companies, while employers were more likely to use a formulary or a pharmacy benefit manager.
The contracts usually lasted for one to two years, according to the survey results. However, the short window doesn’t allow digital health technologies much time to make an impact, PHTI wrote.
“One- to two-year contract terms leave a short window for solutions to demonstrate their value and demonstrate clinical improvements,” the report says. “Most employers and payers review their digital health technology portfolios annually, while health systems are most likely to update as needed.”