Amid digital health boom, customers question what's essential vs. commodity 

The COVID-19 pandemic has opened the door for an explosion of digital health activity, leaving customers with thousands of new service offerings to choose from for digital healthcare, according to a May 3 Wall Street Journal report. 

Corporate-benefits executives, who are the main customers for digital health startups, have been overwhelmed by the sharp increase in offerings over the past year, specifically startups pitching redundant and overpriced services. 

"We are inundated," said Meredith Touchstone, director of benefits at CarMax, according to the publication. "We already have these very big portfolios of vendors. And with all this new stuff coming into the market, there's no way to assess, literally thousands" of digital health services now available.

In the first quarter of 2021, healthcare services venture capital hit a record of $7 billion — the highest quarterly total in the past decade, according to research firm PitchBook. Amid the large increase in digital health offerings, benefits executives are asking digital health companies to add services, merge complementary companies and make deals on pricing to differentiate themselves from all the other companies, the Journal reports. 

Employers are asking digital health providers to integrate with their insurers and increase the conditions their products address as well as stop charging monthly fees for employees and instead just charge when workers use the services, according to the report.


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