Digital health interest shrinks while AI is still on the rise
Why Artificial Intelligence is Stealing the Spotlight from Digital Health
It's fascinating to observe the ebb and flow of investor interest. While the healthcare sector has been a hotbed for innovation, recent trends indicate a curious shift. Digital health funding, once the darling of investors, has seen a decline that's hard to ignore. On the other hand, artificial intelligence (AI) in healthcare is enjoying a meteoric rise, capturing the imagination and wallets of investors. What's behind this dichotomy, and what does it mean for the future of healthcare?
The second quarter of 2023 has been a bit of a reality check for digital health. Funding levels have plummeted to lows not witnessed since 2017. According to a report from CB Insights, the global digital health market has been stagnant for several quarters, reaching its nadir at $3.4 billion. To put this in perspective, the first half of 2023 reported a total digital health funding of $6.9 billion, half of what was seen in 2022 and the lowest since 2015. The American Hospital Association corroborates these findings, adding another layer of concern to the narrative.
While the United States has been the primary source of digital health funding, there's been an 80% decrease in investments compared to the first quarter of this year. It's a staggering drop that raises eyebrows, considering the critical r’s critical role in modern healthcare systems. Digital health technologies have enhanced patient care and operational efficiency, from telemedicine to electronic health records. So, why the sudden cold shoulder from investors?
Conversely, AI is enjoying a completely different trajectory. Investments in AI applications, particularly in clinical support areas, diagnostic imaging, and automated documentation technology, have been on an upward trend. The technology is not just surviving but thriving, and it's not hard to see why. AI has the potential to revolutionise healthcare in ways that digital health technologies, as vital as they are, simply can't. From predictive analytics to personalised medicine, AI offers a range of applications that promise to transform healthcare delivery.
Interestingly, despite the diverging trends, there's a consensus that generative AI will become increasingly prominent across digital health systems. This suggests that digital health may be experiencing a slump, but it's far from being written off. Integrating AI into digital health platforms could be the shot in the arm, reviving investor interest. After all, the fusion of AI and digital health could lead to groundbreaking innovations that redefine healthcare as we know it.
So, what's the takeaway here? The decline in digital health funding is a cause for concern, but it's not the end of the road. The rise of AI in healthcare is not just a trend but a testament to the transformative power of technology. Investors are perhaps looking for the next big thing, and AI fits the bill right now. However, the potential synergy between AI and digital health should not be overlooked. It's a relationship that could unlock new frontiers in healthcare, offering a win-win scenario for investors, healthcare providers, and patients alike.
While the scales may currently tip in favour of AI, the interplay between digital health and artificial intelligence is a space worth watching. It's a complex, dynamic landscape that defies easy categorisation, making it incredibly exciting.
Source: Beckers Hospital Review