What's Happening?
As healthcare costs continue to rise, employers are showing restraint in increasing their investments in digital health solutions. According to a survey by the Peterson Health Technology Institute, only one-third of employers plan to increase their spending
on digital health in 2025, a significant drop from the previous year. In contrast, health systems and health plans are more optimistic, with 84% and 79% respectively planning to boost their digital health expenditures. The survey highlights that cost is a primary concern for employers when evaluating digital health providers, with two-thirds citing it as the top factor. Despite the stagnation in spending, there is a strong uptake of digital health solutions among employees, with 44% of eligible workers enrolled in such programs.
Why It's Important?
The decision by employers to maintain rather than increase digital health spending reflects broader economic pressures and the need to manage costs effectively. This trend could impact the growth of digital health innovations and the availability of new solutions for employees. While health systems and plans are expanding their investments, the cautious approach by employers may slow the overall adoption of digital health technologies. This could affect the healthcare industry's ability to deliver more efficient and accessible care, potentially influencing employee satisfaction and productivity. Employers' focus on cost may also drive them to seek more cost-effective solutions, impacting the competitive landscape for digital health providers.
What's Next?
Looking ahead, employers are expected to continue prioritizing cost-effective digital health solutions. HR departments may play a crucial role in promoting the benefits of digital health to both employees and leadership, emphasizing convenience and potential cost savings. As digital health solutions evolve, there may be opportunities for employers to reassess their strategies and potentially increase investments if cost-effective and impactful solutions become available. The ongoing development of digital health technologies could lead to new offerings that address current cost concerns, encouraging more widespread adoption.
