Integration as a strategy: What RPM product teams can learn from recent M&A trends
Mar 28, 2022
The goal for most remote patient monitoring (RPM) product teams sounds something like this: To successfully deliver whole-person care (anywhere) while continuously fortifying the health of both patients and their business.
To achieve this, they need more than a village. They need an ecosystem.1
Healthcare is becoming more connected and integrated. Digital health’s robust M&A market is just one sign. It took only the first three quarters for 2021 to outpace the sector’s deal count by 70. And within the digital health space, RPM is trending up in both funding amounts and IPO frequency, signaling a future of intensified M&A activity.
The steep M&A increase in 2021 — and the revealing patterns within those deals — creates an urgent call to action for RPM product teams: Your technology must play well with others.
For your RPM solution to thrive, you need to think about integration as something more than just a rudimentary data pipe to an EHR. In the next five years, it’s very likely your RPM technology will be involved in an M&A or a strategic partnership. For this reason alone, you should approach integration as a business strategy.
Ready to turn your integrations in a more strategic direction?
To help guide you, we’ve created three tips inspired by M&A trends in the RPM space.
Tip #1: Integrate to enhance value creation
In 2021 and early 2022, a wide variety of healthcare organizations acquired RPM solutions. Although the strategic reasons for each pairing vary, all in some way enhance the value that the purchasing company brings to the market.
Recent RPM M&A Trends
Acquirer of RPM | Why | Example |
|---|---|---|
Health systems | To shore up their virtual care capabilities | Carbon Health buys Steady Health and Alertive Healthcare |
Consumer retailers | To grow their healthcare presence | Best Buy acquires Current Health |
Health services | To diversify bundled offerings | ModivCare buys VRI |
Population health platforms | To expand datasets for richer insights | Lightbeam Health Solutions acquires Care Signal |
Durable medical equipment vendors | To gain entry into the connected care space (via connected devices) | Hillrom buys Bardy Diagnostics; Boston Scientific’s acquires Preventice Solutions |
Health tech giants | To capture more of the care continuum | Royal Philips acquires BioTelemetry |
Your competitors are watching these trends and using them as a springboard for product development. The winners are planning ways to scale their integrations to support M&A — or, at the very least — to keep pace with bigger players in your market.
Your integration strategy should accommodate any of these situations right now, regardless of what M&A plans your company may (or may not) have at the moment.
To help articulate your integration strategy, try framing the value creation story of your solution. Ask yourself the following questions:
What is your RPM solution’s mission?
What is the shared outcome that you and your customer are working toward together? Is the outcome part of a larger problem? If so, how much of this problem does your solution solve?
What unique skills, capabilities, or processes does your solution bring to drive desired customer outcomes? What makes your solution irreplaceable?
To what degree is your customer’s perception of your solution’s value worth the cost paid?
What is your solution’s relationship value or overall customer experience? What is lacking?
As you think about your answers, some gaps in your solution’s value may surface. How might integration — of systems or with another company’s capabilities — enhance your solution’s value and avoid commoditization?
Carbon Health’s M&A activity in 2021 is a good example of how integration can be used strategically to enhance value. The San Francisco-based primary care provider completed two RPM acquisitions to fortify its “omnichannel care” value story. Carbon Health purchased virtual diabetes management startup Steady Health, followed by its tuck-in purchase of RPM company Alertive Healthcare. With these acquisitions, Carbon Health added continuous care (via connected devices) to its omnichannel menu of in-clinic, comprehensive, and coordinated care.
Whether you’re integrating systems, datasets, or entire companies, unexpected changes and complexities are inevitable. This is why your integration strategy should be as adaptable as possible.
Tip #2: Take an agile approach
Your RPM solution’s future success depends on how fast, flexible, and repeatable you can be with your integrations.
Even if you don’t see an M&A in your company’s immediate future, build an integration strategy to support one.
Lean into an “open architecture” bias. Make sure your infrastructure choices will equip your RPM technology to adapt to increasingly complex IT environments, new data sources, and cloud services.
A solid step in this direction is to lean fully into FHIR conformant architecture. Slowly but surely, FHIR has evolved to the point where government regulators have felt comfortable writing it into legislation as the de facto standard for health data exchange. Moving forward, we will see a steady increase in its availability and use by organizations that exchange health data. Ensuring as much of your internal health data
is structured in FHIR format will position you as compatible with the widest range of organizations.
Even though doubling down on your investment in FHIR is the prudent choice, there still is the issue of bridging the gap between healthcare today and its inevitable future. To do that, you’ll need to develop a mechanism for accommodating other data standards and protocols in use today. This includes HL7v2 and proprietary EHR vendor APIs. To solve this, you have two viable options.
Your first option is to develop internal mechanisms for data transformation and delivery. You’ll need internal expertise in HL7v2, along with additional architecture to support legacy data exchange mechanisms like VPNs. The downside of this approach is that in the scenario of a
merger/acquisition, you’ll need to reconcile all of this custom code and systems with your new partner.
Your second option is to work with an integration vendor that has built a successful track record facilitating health data exchange and removes the need for your team to build these capabilities. In this scenario, you can effectively operate as if FHIR were the universal mechanism for health data exchange, storing health data in a FHIR format and issuing queries/delivering data in accordance with the standard. The best part?
Your engineers won’t be pulled away from your solution to build connections or fix integration errors. Instead, you can lean on the experience and knowledge of your integration vendor while your engineers concentrate on improving your solution.
Tip #3: Eye your solution like a buyer
Your team spends considerable time and energy making your solution buyer-ready. Savvy entrepreneurs take the same approach when they build their businesses. They look through a potential acquirer’s lens: How might their company’s method of value creation make an acquiring business better?
This same rationale can be applied to help you choose strategic integrations for your RPM solution. Let’s say you sell a wearable, a patient engagement application, and a patient management portal for contin uous glucose monitoring. A couple of your health system customers say they’re working on customized engagement scenarios for their diabetes patients. You’ve already established live connections with their EHRs.
From the health system’s perspective, how might your technology deliver more value? One way might be to integrate your RPM solution with a health system’s customer relationship management (CRM) platform.
With this integration, your RPM data can be routed to the CRM when a wearable/application alerts a patient to a health concern. From there, the health system can reach out to the patient, see how they’re feeling, and determine the next best step in their care. Often this will involve scheduling a clinical follow up.
Another way to help your customers boost their patient engagement might be to add a smart chatbot to your RPM application. Don’t have the developer resources to build it? Take a page from Connect America’s playbook and partner with an AI-assisted RPM company.
Solutions that have a proven track record of working with multiple systems and offering different touchpoints to multiple user groups are more compelling to organizations looking to build an “all-in-one” offering.
Watch this space: RPM partnership trends
M&As are not the only way to use integration as a strategic lever. In 2021, RPM tech pursued more meaningful and measurable value creation by forging strategic partnerships.
Population health: Pregnancy app BabyScripts partnered with Health New England, creating the first point-of-care solution to incorporate
a health plan. The partnership aims to improve care coordination between the health plan and doctors to identify clinical and social risk in the population.
Tech bundling: Health IT services provider Greenway Health expanded its partnership with RPM company MD Revolution. Through this collaboration, Greenway Health enhances its EHR-integrated care management solution with RPM capabilities.
Home-based clinical trials: Mental telehealth company Cerebral and biotch precision psychiatry organization Alto Neurosciences joined forces to launch a mental health RPM program for clinical trial participants involved in testing new medications and treatments.
More holistic, equitable care: Advanced RPM-equipped telehealth company DrKumo partnered with outpatient center Alternative Healthcare LA to expand RPM for physiological, mental, and behavioral health with a special focus on underserved populations.
Sometimes, when you put on your buyer’s hat, you see ways to use integrations to address customer objections. For example, research reveals health systems’ number one barrier to RPM solution adoption and scale is cost.2
To surmount this obstacle, you may choose to explore integrations with health systems’ highest volume health plans. With the right integration, you can offer improved prior authorization, charge posting, and payment collection that will provide clear and measurable ROI. In the increasingly competitive digital health market, you need to position your solution
as having thought of everything. You don’t want to be seen as solving an acute clinical problem but ignoring the very real operational and administrative steps necessary for successful solution deployment and utilization.
Conclusion
Whether you’re looking for customers, partners, funding, or an M&A deal, your RPM solution’s success hinges on a strong integration strategy.
This cohesive set of choices describes where you will integrate, how you will win, and the capabilities you’ll need to deliver the best value in the marketplace.
Recent M&A trends can provide helpful guidance. Which of the M&A scenarios are the most likely and most desirable for your RPM technology? Which technologies, talent, and processes are required to support those scenarios?
Mapping all this out is important. Even more critical is investing in your infrastructure now so you can quickly operationalize your integration strategy. After all, you don’t want to put M&A talks or customer integrations on hold while you scramble to make your infrastructure ready.
When you habitually approach integrations as one-off projects (without an integration strategy), you’re putting your RPM solution’s longevity at risk. Don’t make this mistake.
Chances are, an M&A is already in your future. If you articulate your integration strategy and invest in your infrastructure now, you’ll save your solution from being sidelined by someone else’s plan.