Mobile health companies need to prove value

A couple of debates keep raging in mobile healthcare, and a recent, widely publicized report from PricewaterhouseCoopers has helped to fan the flames.

First off, what exactly is mobile healthcare?

To measure a market, it's useful to define it--and mobile health is in its formative, chaos phase of market immaturity," writes health economist Jane Sarasohn-Kahn in a commentary for iHealthBeat. "We're at the apex of the mobile health hype cycle, per Gartner's definition of 'inflated expectations.' What's included underneath the mobile health umbrella? Is everything mobile? If so, Eric Dishman argues in the Intel Health blog, then nothing is. Noting the proliferation of m-health meetings, associations and initiatives, Dishman writes, 'The phrase has become so slippery, so ubiquitous as to become almost useless. We must be more careful in defining and aligning what we're talking about.'"

And then there is the question of what "willingness to pay" really means. The PwC report found that 40 percent of Americans would be willing to pay for some mobile health services, a number that may or may not be in the same ballpark as other, earlier studies, according to Sarasohn-Kahn, because definitions vary widely.

For one thing, only half of those responding to the PwC survey would pay more than $5 a month for a mobile phone application that helps them manage their health. "Market-rubber hits the road when it comes to people's willingness to pay for a product," Sarasohn-Kahn says. We economists have a specific lens on consumers' willingness to pay: it falls into the economic theory of value. If something is worth having, it's worth paying for. When it comes to mobile health, consumers aren't yet connecting the dots toward 'my health' and value.

In healthcare in particular, people have grown accustomed to only paying a small amount of the true cost for care, in the form of co-pays. But if a co-pay goes up, even from $5 to $10, some people will not see the doctor or get a prescription filled.

"Perhaps the ultimate question is not to ask consumers, 'What would you pay for a mobile health device?' But instead to ask,'What's your health worth to you?'" Sarasohn-Kahn says. "That would get to the root of peoples' value in health. If people connect the dots between mobile health applications and their own health, or the health of those they love, they'll buy. If the benefits aren't transparent or proven, they won't."

For more:
- take a look at Sarasohn-Kahn's iHealthBeat commentary