Digital Health & HealthTech: 2024 Retrospective on Predictions & Highlights

As we approach the end of 2024, it’s high time to reflect on the digital health trends our team predicted at the beginning of the year and compare them with the actual developments in the industry. Let’s examine the main directions outlined in our article and video and evaluate how they align with real-world events and industry progress throughout the year.

AI Chatbots and Virtual Assistants

BeKey Predicted: A significant growth in the healthcare chatbot market was anticipated.

Reality: The prediction proved to be accurate. According to the latest report by Grand View Research, the medical chatbot market reached $450 million in 2024, exceeding expectations. The adoption of AI assistants in healthcare facilities increased by 40% compared to the previous year.

Key Developments:

• Mayo Clinic launched an AI assistant for patients, processing over 1 million queries monthly.

• FDA approved the first AI chatbot (named AI-COA) for mental health monitoring.

AI in Healthcare Management

BeKey Predicted: AI was expected to optimize administrative processes and improve efficiency.

Reality: This prediction was partially realized. While AI adoption in healthcare management increased, the cost savings were lower than initially projected.

Key Developments:

• A KPMG study revealed that AI use in healthcare management led to 15% cost savings, rather than the anticipated 30%.

• However, 80% of healthcare facilities reported improved operational efficiency due to AI systems.

IoT-Driven Virtual Hospitals and Telemedicine 3.0

BeKey Predicted: Significant growth was expected in the healthcare IoT market and the development of virtual hospitals.

Reality: This trend proved to be one of the most accurate predictions.

Key Developments:

• The healthcare IoT market reached $200 billion, surpassing forecasts by 6%.

• The number of patients receiving treatment through virtual hospitals increased by 150% compared to 2023.

• Launch of the first fully virtual hospital in the US, serving over 100,000 patients monthly.

AI Predictive Analytics and Remote Patient Monitoring Devices

BeKey Predicted: Widespread adoption of AI for prognosis and improvement of treatment outcomes was anticipated.

Reality: The prediction was accurate but with some nuances.

Key Developments:

• A study published in JAMA showed that AI predictive analytics improved early diagnosis of cardiovascular diseases by 30%.

• While remote monitoring devices hold great potential for improving healthcare outcomes, their implementation has been hindered by the general slow pace of adopting new technologies in the healthcare sector as well as regulatory hurdles, cost, data privacy concerns and resistance to change.

Mental Health Technologies

BeKey Predicted: Significant digital mental health solutions market growth was expected.

Reality: This trend exceeded expectations.

Key Developments:

• The mental health app market reached $5 billion, 25% higher than forecasted.

• Launch of a national digital therapy program for depression treatment in the UK, reaching over 1 million patients.

Healthcare Outsourcing and Offshoring

BeKey Predicted: Growth in IT services outsourcing in healthcare was anticipated.

Reality: This trend was less pronounced than expected.

Key Developments:

• The healthcare IT outsourcing market grew by 4%, below the projected 6.5%.

• Stricter regulatory requirements for patient data protection slowed the pace of medical services offshoring.

Overall, most predictions regarding digital health trends for 2024 proved to be quite accurate. Particularly impressive were the development of IoT-driven virtual hospitals, growth in the mental health technology market, and the implementation of AI chatbots. However, some areas, such as outsourcing and cost savings from AI implementation in healthcare management, showed less progress than anticipated.

A Year of Growth and Investment

2024 was a year of growth for the digital health sector, with global investments reaching $15.3 billion in the first half of the year, a 20% increase from the previous year. This influx of capital fueled innovation and expansion across various areas of digital health.

AI-Powered Solutions Take Center Stage

• Abridge, an AI-driven medical documentation startup, secured significant funding ($150 million Series C) in February, reaching a valuation of $850 million. Its integration with Epic Systems, a dominant player in electronic health records, solidified Abridge's leading position in this space.

• Transcarent, focused on healthcare solutions for large employers, also attracted substantial investment ($450 million Series D) reaching a $2.2 billion valuation. The company launched an AI platform to enhance member experience by answering coverage questions and facilitating connections with medical professionals.

• Beyond administrative tasks, AI has demonstrated its potential to transform diagnostics. It has been indicated that AI could improve breast cancer detection rates by 21%, highlighting its potential to augment traditional methods.

Digital Therapeutics feat. FDA

2024 also was comparatively good for digital therapeutics (DTx), with several companies achieving FDA approvals or making regulatory progress:

• Huma Therapeutics secured FDA 510(k) Class II clearance for its versatile SaMD (Software as a Medical Device) platform, applicable across various health conditions.

• Click Therapeutics received FDA approval for CT-132, a digital therapeutic app for episodic migraine treatment, which had previously been granted Breakthrough Device Designation.

• Swing Therapeutics obtained FDA De Novo authorization for Stanza, a prescription digital therapeutic (PDT) for fibromyalgia, following the successful PROSPER-FM trial, the largest ever conducted for this condition.

Positive Impacts on Patient Care

Digital health solutions continued to demonstrate their potential to improve patient care in various ways:

• Telehealth and RPM expanded access to care for patients in remote areas and those with limited mobility. Preliminary data indicates that the number of worldwide virtual consultations with doctors has increased by as much as 30% compared to 2023.

• Mobile health apps empowered patients to take control of their health, with downloads reaching 5.4 billion in 2024.

Challenges and Setbacks

• The year was marked by several high-profile bankruptcies, including Forward Health, Steward Health Care, CareMax, Pontiac General Hospital, MCR Health, and CarePoint Health. These cases highlighted the financial pressures faced by healthcare providers, particularly those with high debt loads, those serving vulnerable populations, and those impacted by natural disasters and policy changes.

• Babylon Health’s struggles and eventual closure of its US operations served as a cautionary tale about the challenges of scaling a digital health business and achieving profitability in a competitive market.

• The end of 2024 brought a tragic loss to the healthcare community with the murder of Brian Thompson, CEO of UnitedHealthcare. While we strongly condemn this act of violence, it has ignited important discussions about the challenges within the US healthcare system. Frustration over insurance denials, medical bankruptcies, and barriers to affordable care has reached a boiling point. This tragedy should serve as a catalyst for regulators and society as a whole to rethink our approach to healthcare access and affordability.

• The HealthTech sector experienced a significant market correction, with many public companies seeing their valuations drop from previous highs. While venture capital funding in digital health showed signs of recovery in 2024, it remained significantly below the record levels of 2021. This reflects a more cautious approach by investors amid economic uncertainty and increased scrutiny of digital health business models.

Despite the challenges, the digital health industry continues to innovate and evolve, driven by a shared commitment to improve healthcare outcomes and access for all. Looking ahead, we remain optimistic that technology will play an increasingly vital role in transforming healthcare for the better.

Conclusion

Digital health continued its evolution in 2024, with notable advancements in telehealth, remote patient monitoring, and AI-powered solutions. These technologies demonstrated their potential to improve patient care, increase access, and streamline healthcare delivery. However, the year also underscored the limitations of technology in addressing the fundamental flaws within the US healthcare system. These challenges, deeply rooted in the complex interplay of healthcare providers, payers, and regulators, cannot be solved by technology alone.

While digital health offers powerful tools for enhancing care, true progress requires a comprehensive reassessment of how healthcare is delivered, financed, and accessed. This necessitates a shift away from fragmented, profit-driven models towards a more integrated, patient-centered approach.

We look forward to identifying and analyzing trends for 2025 in the coming weeks, providing insights to guide the future of digital health and HealthTech. Stay tuned for our upcoming video, where we’ll explore how these emerging trends can potentially revolutionize healthcare delivery and patient outcomes in the year ahead.