Do insurers or regulators appreciate the risks around health tech? Stephen King, partner at national law firm Mills & Reeve LLP, looks why health tech needs a collaborative approach to legislation.
There are many reports of unicorns in the global healthcare sector. Examples include businesses based on confidential data management or data sharing, underwriters with products around insurable risks, consultancy or electronic platforms for telehealth or research in and exploitation of biotechnology.
The ever-increasing pace of technological development, for example in the field of wearable health tech and the applicability of technology to healthcare, along with the digital transformation of data or records management has, not surprisingly, attracted large tech companies and start-ups to the healthcare sector.
This feeding frenzy in the world of health tech increases collaboration around know-how, research and development resources, as well as the availability of investment cash.
This healthcare tech-rush or HT-R shows no sign of slowing down across a global market keen to harness the power of digitisation, whether for better patient outcomes, or return on investment purposes.
Alongside that dash to invent and exploit health tech, regulators have an eye to ensuring that rules, protocols and consumer/patient protection laws, stay abreast of the HT-R to ensure effective market management and effective redress if things go wrong.
Equally, health tech businesses are ever more locked in dispute resolution or legal testing of competition and intellectual property rights, across a global jurisdiction, offering a variable level of comfort to shareholders, governments or end users.
The role of the judge in a digital age
Although one can discern a developing coalescence of interests among the varied stakeholders involved in health tech development and deployment in healthcare services, managing those interests will need agile assessment and effective regulation. That will include high-level cross-jurisdictional agreements, to ensure that investment returns continue to attract the resources required to present the healthcare solutions governments with what their populations expect or aspire to.
Speaking at the UEA Earlham Hall Law Lecture in Norwich earlier this month, Judge Anna Marcoulli of the General Court of the European Court of Justice spoke of the ‘Role of the Judge in a Digital Age’, and addressed the gap that could emerge between effective legislation and run away technology where large tech corporations battle for dominance in an arena where legislation seeks to curb monopolistic tendencies that might harm the consumer.
How to insure against future risks
It is no surprise that insurance market underwriters are following this HT-R closely. Again, here is a globally operating commercial sector, the core business of which is the evolution and development of their insurance risks solutions. Insurers see health tech as an area ripe
for exploitation, in advance of the more restrictive regulatory devices that will inevitably
control the HT-R they are aiming their insurance products at. In fact, the insurance sector and the availability of an insurance solution is an interesting study when considering where health tech is going. It will inevitably enable the promotion of new insurance products
designed to provide indemnity or mitigation solutions for emerging risks. Those risks might be transactional or consumer protection related, evolving as technology develops and enticing capital into a global market for those insurers who can demonstrate an ability to bring a new and market-leading product, where the insurer demonstrates their understanding of the emerging healthcare technology risk.
Do insurers or regulators fully appreciate the risks emerging around health tech? Typically insurance solutions lag behind the emergence of the risk.
Without doubt, health tech is becoming ever more visible and used. Any technology that can assist in the maintenance or monitoring of wellbeing, expedite the availability and accuracy of diagnostics, or manage the complex interactions between stakeholders in the delivery of care and the management of the wellbeing of a population, or individual, is valuable.
Even more so if that healthcare provision can, because of the technology employed, operate across a geographic and jurisdictional space that spans the globe. It is easy to see how such technology could be used to benefit populations far removed from those of the developed world and in areas where advanced healthcare infrastructure assets do not exist or are limited.
Who would have believed that many routine tasks could be undertaken using one small compact mobile phone? Yet the use of local, compact, mobile and disposable (if recyclable) devices, even implanted devices, are seen as ever more routine parts of a healthcare community that operates digitally and globally.
Deloitte has in the past reported that the global market value for what it styled digital health was worth £23bn (US$29bn) in 2014, and expected to almost double to £43bn by 2018. In its 2019 Global Health study it identifies a trend in global healthcare spending which it predicts will rise to US$10.1trn by 2022.
That scale of investment attracts many to the health tech and digital health market where so far, the risks attending the use of such technology are less identifiable around the technology itself (save in the context of intellectual property protection or anti-competition legislation). Instead, it is identified against the use made of the technology, or the judgments made, by the professionals providing care, in reliance on the data that is a product of using it.
Before long it is likely that liabilities will emerge, or at least be imagined, around the way health tech is used or deployed, and which will inform our wider understanding of risk associated with health tech.
The new models of healthcare
Providing healthcare is a continuous, never-ending journey in adopting models of healthcare to support the investment required around those models, while providing
acceptable profits or margins, or patient outcomes, for those health tech and healthcare businesses looking for returns. Healthcare delivery models that embrace more assertive consumer/patient choices and virtual environments that can be effectively monetised to provide a return on investment are in demand.
Digital technologies are supporting this move to new models of patient-centred care, as they respond to modern patient demands for accessibility and quality, and individual time management, while lowering the cost of healthcare supply. Robotic process automation or RPA, blockchain, artificial intelligence and the Internet-of-medical-Things are just some of the ways technology is changing or disrupting health care provision.
And to come back to risk and insurance solutions – where are the insurable risks? Well, everywhere, but until something goes wrong do the health tech businesses, or their investors, know the extent of the risks attending that product?
Did the underwriter who offered cover, offer cover for the risk that has emerged and the loss caused? Did the exclusion designed to limit the scope of the insurance cover deal with the mischief expected, or was everyone ignorant of the actual risk that has emerged and fail to appreciate the risk exposure they have come to realise they now have?
Health tech will more and more be a natural and often invisible part of our lives.
The unseen but ever-present risks of technology will need a collaborative approach by governments, regulators and investors to ensure the health tech community remains vibrant, progressive, ethical and dare we say, patient-outcome focused.