Daily Management Review

What trends will be affecting the health sector in the coming years?


02/11/2019


Health spending in the world is growing faster due to aging populations, spread of chronic diseases and introduction of expensive technologies. Market players will have to adapt to growing digitalization and adapt to changing external conditions, according to a report from consulting company Deloitte.



pixnio
pixnio
According to estimates of Deloitte experts, cost of health care in the world in 2017 amounted to $ 7.7 trillion. Until 2022, these expenses will grow by an average of 5.4% per year and reach $ 10 trillion. For comparison, from 2013 to 2017 the growth rate was 2.9% per year.
 
A huge gap between different countries will remain. While per capita health care spending will reach $ 11.7 thousand per year in the United States by 2022, it will be $ 54 in Pakistan. In 2022, annual spending on health care in North America should reach $ 4.2 trillion, in Western Europe - $ 2.3 trillion, while in Latin America - only $ 437 billion, and in the Middle East and Africa - $ 279 billion.
 
Life expectancy will continue to increase from 73.5 years in 2018 to 74.4 years in 2022. In this regard, proportion of population over the age of 65 will increase to 11.6%, reaching 668 million people. In some regions, the share of older people will be much higher, particularly, 29% - in Japan, and about 22% - in Western Europe.
 
According to analysts, the fight against infectious diseases will become increasingly effective. For example, the number of AIDS-related deaths has already dropped from 2.3 million in 2005 to 940 thousand in 2017 and will continue to decline. The number of people who died from malaria decreased from about 1 million in 2000 to 445 thousand in 2016.
 
The proportion of deaths from noncommunicable diseases, especially cardiovascular diseases, cancer and diabetes, will increase from 71% in 2016 to more than 80% (in some developed countries). The number of deaths associated with environmental pollution is also growing. In 2016, their number was 4.2 million. First of all, this problem affects the Asia-Pacific region.
 
Experts highlighted the main problems and challenges that health care market players will face in 2019.
 
One of them is the need to maintain financial stability against the background of rapid changes. Growing costs make players need to think about reducing costs and increasing efficiency, as well as about emergence of new competitors in the face of technology companies in traditional medical institutes. According to the study’s authors, the medical technology sector will grow in the coming years by an average of 15.9% per year and will reach $ 280.3 billion by 2021.
 
Another challenge is investment in technology and digital transformation. Artificial Intelligence (AI) can help in the diagnosis and development of new drugs. Virtual and augmented reality can be used both in training doctors and in the process of treatment. Medical Internet of Things will help monitor patients.
 
Both governments and IT giants are paying attention to development of this sphere. Apple is developing the medical application, Health Gorilla, and Google is creating an AI that could predict the risk of disease in patients and improve the search for medical data.
 
Growing digitalization is also affecting the format of care provided. On the one hand, many procedures that previously required hospitalization can now be performed on an outpatient basis. On the other hand, telemedicine, that is, the provision of medical services online, via teleconferences, applications, etc., is becoming increasingly common.
 
Yet another task is adaptation to changing needs and expectations of customers. Such changes are related:
 
- to an increasing number of chronic diseases,
- to competition from technology companies,
- to proliferation of apps that allow people to track their health,
- to consumer experience in other areas
- to more demanding customers in paid medicine.
 
Another challenge for the industry is compliance with regulatory standards, which also change fairly quickly. Because of digitalization, market players will have to pay increasingly more attention to cybersecurity, especially since the data on the state of health of people are quite sensitive.
 
source: 2deloitte.com






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