The energy at HLTH 2022 was palpable, with over 12,000 people showing up to Las Vegas last week to discuss the current and future state of digital health innovation, at a conference that was back to wow after two years of fully and partially virtual attendance.
But the celebratory feeling, the over-the-top exhibit booths centered around an elaborate “moon viewing” station, attendees taping with smartphones as Ludacris held out a microphone from a stage, asking the crowd “what’s your fantasy”? Well, it all felt a little…ludicrous.
Now, I’m aware that events like these are planned far in advance, and the tenor of the conference would have been right on target with the state of the field a year ago. But with recession, labor shortage, and the rapidly contracting capital environment dominating conversations— and with many of our providers of care absent because of reduced budgets — the at-times over-the-moon marketing spend did not reflect the crucial truth: the digital health ecosystem is about to face its “put up or shut up” moment.
Here are some of my unexpected key takeaways from the event.
The overall belt-tightening was felt in the event’s panel discussions, if not in its production value.
Venture capitalists are putting the brakes on what has felt at times in the recent past to be a free money free-for-all for digital health, with high interest rates dramatically slowing investments. That doesn’t mean a full stop on cash flow, but rather a significant change in perspective and goals. Investors are now looking for companies to demonstrate real value (and reasonable growth), rather than the growth at any cost that was the target of the 2020-2021 boom.
This puts startups and other visionary innovators at a disadvantage, but not totally out of the running. There is a higher demand from these companies for clear demonstrations of ROI — and companies that can demonstrate real value still have a leg up even in a more conservative investment market.
“Value” is everything, but the definition of that is uncertain.
What constitutes value was less clear, as industry leaders remarked on the disconnect between investment dollars and measurable clinical results. The phrase “value-based care” was heard a lot during the event— so much so that it featured on the tongue-in-cheek “industry buzzword” bingo cards handed out to attendees —but without substantial evidence that digital health tools are measured by how they contribute to healthier populations.
Don’t get me wrong, I am just as bullish on VBC as every other founder, but an honest discussion of the current day reality would reveal that near term, sure bets are favored over longer term bets (i.e. VBC).
The most important stakeholders were absent from the floor.
Those who have arguably the most to add to these conversations were underrepresented to borderline absent from the conference — the providers of care who at the end of the day dictate the success of a digital health solution through adoption and use. Their absence was another reminder of the financial strain that health systems are under, as well as persisting issues of burnout and labor shortages, and it was felt in particular in conversations around value.
At times the conference felt like an overflowing pool of vendors, capital allocators, industry service providers and pundits (so called) all pontificating about the future, while the centerpiece of our healthcare system - actual providers of care - were missing in action, likely stretched thin and left contemplating how to navigate their next challenge.
My most important takeaways from the conference didn’t come from the panel discussions, the coffee meetings or the networking receptions, but rather from observing the industry as a whole. And that takeaway is clear: the digital health ecosystem needs to cut through the hype and start delivering on the promise it has been touting for years. That means transforming the sector into one that is less about celebrating unicorns, to one where slow incremental steps over time are viewed as the giant leaps that they are.