Healthcare Startups take aim at mental health 2015

The digital health movement continues to gain momentum, as innovations (and investments) in EHR/EMR, Big Data, wearable technology, and a host of other digital health/ehealth companies, apps and trackers picked up a staggering $6.05B across over 1400 deals since 2010. [insert ‘yearly deals’ image w/source]

One niche (not so) quietly gaining momentum using digital health to disrupt traditional approaches, is online mental health, telemental health, or, Web Therapy. Despite the heated debates on ethics, legality and effectiveness, this web therapy is looking to fill a direct need: More than 80 million Americans live in mental health professional shortage areas, according to the US Health and Human Services Health Resources and Services Administration.

Statistics and the ACA

Even in areas where mental health professionals abound, and despite the initial efforts and investitures of the Affordable Care Act, a recent report found that there is only one mental health provider for every 790 people. This statistic, when put in context, is disconcerting at best. The same report by Mental Health America (paid for by Takeda Pharmaceuticals and Lundbeck USA) found that,

–          42.5 million adults in America, 18.19 percent, suffer from a mental health issue.

–          19.7 million, or 8.46 percent, have a substance abuse problem.

–          8.8 million, or 3.77 percent of Americans have reported serious thoughts of suicide.

–          About 60% of Americans who experience a mental health crisis will never seek help.

–          Only 40% of American Veterans who need mental help seek it out, due to stigma or inability to travel.

With these statistics in mind, entrepreneurs like TalkSpace’s Oren Frank believes that the anonymity of online options will enable more people to receive therapy on their own time, and their own terms. “Stigma and shame is a huge factor – maybe the most important one, People who have been to regular therapy are less ashamed of it, but people who are newcomers are paralyzed by fear” Frank said in a recent interview with Gigaom.

Despite all odds

This new and relatively small field still has therapists worried about liability issues, misdiagnoses and ethics. And patients may have some concerns over privacy and security online, not to mention if, or how, digital mental health will be covered by insurance companies. But despite these trepidations, the digital mental health landscape is gaining ground: Companies like ABPathfinder, TalkSession, Breakthrough, and ThriveOn have made it into several startup watch lists. Companies like MDLIVE are making major moves, acquiring BreakThrough Behavioral in November of 2014, and entering into a deal with Walgreens to expand services. Just this last quarter, Ginger.io raised $20M to boost its digital mental health platform that helps monitor behavior and health.

Telemental Health in the future

From mental health services to disease management interventions, digital therapies could gain a lot of traction as population health management and reimbursement shadow fee-for-service models. And while still controversial, and a small part of the overall digital megatrend in healthcare, analysts and incubators are paying attention. At least Malay Ghandi, Management Director at Rock Health is:

“Seventy-five percent of our healthcare costs are tied to chronic diseases,” said Gandhi. “Eighty percent of heart disease and diabetes is preventable through lifestyle modification. So what we need to see, is more of the software-based programs that can modify behaviors. As these young companies iron out the business model, I think we will see a lot happen here.”

This microniche is worth keeping an eye on, especially in the coming years. 2014 was considered a breakout year for telemental health. And so far, the trend is maintaining in 2015.

Leave a Reply

Healthcare Recruiters International
Right Menu Icon