The Decentralization of Healthcare: Teleradiology on the Rise
COVID-19 has accelerated change and innovation in digital healthcare.
The COVID-19 pandemic has accelerated the need for healthcare decentralization. At a global scale, healthcare systems were not designed or equipped to manage such a crisis, and the pandemic has led to a shift in medical management and the need for decentralized care and diagnostics.
Decentralization of healthcare refers to a system in which most of the healthcare decisions are made by lower levels of government rather than federally. For example, in such a system local governments will make broad healthcare decisions for its residents. In recent years, countries who are members of the Organisation for Economic Co-operation and Development (OECD) have been trending towards the decentralisation of government and the dispersion of power.
According to the OECD report, this has resulted in a rise in recognition of how effective decentralization can be in terms of governance and spending frameworks in public services, as well as in terms of the monitoring of productivity and service quality.
Decentralization of healthcare: How patient care has changed
As a direct result of COVID-19, decentralization is disrupting healthcare systems as patients have been required to stay at home, according to their local government regulations. In addition to social-distancing policies, in-person hospital facilities and doctor’s visits have also been limited.
A report from PRA Health Sciences says that the pandemic has sped up companies’ digital communications strategies by an average of six years, while 75 percent of those surveyed in the poll said that they will also accelerate digital technologies.
Although the COVID-19 pandemic has made the need for healthcare decentralization immediate, the already existing overload of healthcare systems meant it was necessary even before the pandemic. In a report prepared by MaRS, the firm says that the existing healthcare delivery model in countries like Canada will not be sufficient to meet the needs of the country’s citizens.
As COVID-19 has made these changes occur rapidly, healthcare has now changed. Patients are being treated at home as care is being moved outside of healthcare facilities, while telehealth and virtual health visits are increasing.
Furthermore, a number of medical research and technology companies are working to establish safer scanning methods capable of providing accurate and effective diagnostics without the need to attend a hospital or clinic. This move to decentralize the medical industry has proven to reduce costs and inefficiencies within the medical system. For example, studies conducted by the Harvard School Of Public Health demonstrated the potential for decentralization to improve resource equity in medical systems.
Decentralization of healthcare: Teleradiology
Going hand-in-hand with decentralization in the healthcare sector are advancements being made with medical scanning technologies, which are a range of technologies that are used to view a person’s body in order to diagnose, monitor and treat illnesses.
Teleradiology is the process of electronically transmitting diagnostic images from location to location in order to be evaluated or interpreted. Teleradiology specifically benefits understaffed health care sites who may not have access to an on-site radiologist. Teleradiology is used everywhere from hospitals, mobile imaging companies and urgent care facilities to private practices and home care facilities.
The global teleradiology market is expected to grow from US$7.9 billion in 2002 to US$22.8 billion by 2025 at a compound annual growth rate of 23.5 percent during the forecast period. The COVID-19 pandemic is in part responsible for this uptick; other contributing factors include the rising geriatric population, an increase in the prevalence of associated diseases such as cancer, the continued adoption of cloud-based services and the overall benefits of teleradiology. Lastly, the continued adoption of teleradiology in rural communities, which are often not well serviced by hospitals, will also contribute to the sector’s growth.
One company focused on remote teleradiology services is Leveljump Healthcare (TSXV:JUMP), which specializes in off-site readings of radiology scans on-demand, 24 hours a day through its wholly owned subsidiary Canadian Teleradiology Services (CTS). Leveljump Healthcare is currently projected to control approximately 6 percent of the hospital market in Ontario.
According to CEO Mitch Geisler, the company has plans to expand further: “In addition to extending out across the country with the emergency room service, we’re looking to roll out strategy for private clinics that also have a shortage for day service, which is a little bit unique.”
Decentralization of healthcare: The benefits of teleradiology
In addition to medical images being accessible from anywhere, there are other benefits that teleradiology provides, including quicker and more efficient patient care and lower costs, as well as the ability to serve patients in different geographic regions and provide access to radiologists with a wide range of specialities
Teleradiology eliminates the need for travel, allowing radiologists to work anywhere. With existing shortages in hospitals, teleradiology alleviates the stress on staff and can be done with fewer employees, which, in turn, provides more effective patient care.
Decentralization of healthcare: Opportunities for investors
The continuous move towards decentralization in the health sector comes with great opportunities, as much as US$22.8 billion by 2025 in fact. The COVID-19 pandemic has opened the door and accelerated innovations in healthcare where the first half of 2020 saw $10.4 billion in venture fundraising. More specifically, equity funding to digital health companies hit an all-time high in 2020, with $26.5 billion. As the pandemic continues to accelerate change and innovation in digital healthcare, new companies and capital continue to support this ecosystem, creating vast opportunities for market participants in this space.
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