The impact of reimbursement for digital medical technologies and how companies have used it to drive adoption.


Reimbursement is a key driver of uptake.

Payers have traditionally reimbursed for digital medical technologies only when the technology is considered cost-effective, i.e., the cost of treatment is lower than traditional treatments or when there are no other options available. However, this approach does not allow for innovation.

Payers are now considering investing in digital health technologies that offer improved outcomes and quality of care over existing approaches, even if they are more expensive in the short term. Instead of comparing costs against a traditional treatment, payers now look into innovative mechanisms, such as value-based agreements, to cover the costs of promising digital medical technologies.


Reimbursement codes can vary significantly between different types of digital medical technologies

The reimbursement of digital medical technologies is a complex process that depends on the type of digital medical technology. In general, there are six categories of digital medical technologies:

Telemedicine: services provided remotely to patients through the use of telecommunications technologies.

Digital health technologies: health-monitoring devices, such as wearable fitness trackers and smartwatches, that collect data about patients’ health and capture information about their daily activities.

Digital therapeutics: prescription medications administered via an app or other digital platform.

Medical imaging devices: devices used to produce images of the body’s internal structures and functions, such as CT scans and MRIs.

Electronic health records (EHRs): software systems designed to store patient data in an organized way so clinicians can access it when needed.

Implantable medical devices: small devices placed inside the body to monitor or treat a condition such as heart rhythm problems or diabetes.


Businessman on blurred background using digital screens interface with holograms datas 3D rendering

Digital medical technologies have gained tremendous momentum.

Digital medical technologies have gained tremendous momentum. While many of these advances deliver real benefits to patients and providers, there is also a significant financial impact on the healthcare system.

For example, 43.5% of Medicare primary care visits were provided via telehealth in April, compared with 0.1% before the PHE in February 2020

The reimbursement environment for digital medical technologies remains unclear as payers grapple with how to evaluate and reimburse for these new products and services. This dynamic landscape has created confusion among providers about what they can expect from insurers regarding reimbursement for digital medical technologies.


Takeaway: Reimbursement is an essential aspect of the adoption of digital medical technologies

Reimbursement is an essential aspect of the adoption of digital medical technologies. It is important to note that it is challenging for healthcare providers to adopt digital health technologies during the initial adoption stage due to a lack of reimbursement and regulatory barriers. However, as these technologies improve patient outcomes and decrease costs, many payers will adopt more and more of these solutions to improve quality and drive costs down.

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