As we enter 2025, we are poised for one of the most significant periods of change and disruption in Digital Health as we have seen in recent memory. Yes, 2020 was unique in the rate of adoption of many of these solutions, but the underlying technologies like telehealth and remote monitoring, weren’t all that new. Today, we have an unprecedented rate of technological advancement combined with evolving consumer expectations, and a likely significant shift in healthcare and regulatory policies driven by the incoming Trump administration and Republican-controlled congress. Below are 5 key areas that I believe will be most impacted in the year ahead.
Telehealth & Virtual Care
As I write this, it is still unclear whether the U.S. Congress will extend the pandemic-era policies that support access to and reimbursement for telehealth services. So, this may be the first of my 2025 predictions to be completely wrong. However, I expect that the policies will be extended, and use of telehealth and virtual care will expand over the coming year given what appears to be bipartisan support for improving access to remote care. This should result in additional telehealth flexibility and funding for broadband infrastructure that supports rural health. Adoption trends will continue with the highest utilization focused on preventative care, mental health, and chronic disease management.
To hedge my bet, I will include one caveat. The incoming administration favors deregulation which could set up a struggle between access to virtual care and fraud prevention. The impact of deregulation may simplify the adoption of telehealth but could also reduce oversight on reimbursement and patient safety measures.
UPDATE: The U.S. Congress extended certain telehealth flexibilities through March 31, 2025.
AI Use in Diagnostics
Any predictions about the future of digital health must include Artificial Intelligence (AI). I believe that AI will, in fact, be among the most significant technological advances in healthcare, but just not as fast as the futurists want to believe. However, there are a couple of areas that have seen remarkable early success and, as a result, accelerated adoption. The first is diagnostics. In 2025, AI will have an expanded role in early disease detection and population health management. This will be accomplished through enhanced analysis of medical imaging to better detect abnormalities and the application of advanced algorithms to better predict patient risk. I also believe that providers will continue to prioritize AI-enabled tools as they continue looking for ways to address workforce shortages. A similar caveat applies here as with telehealth. Regulatory rollbacks on data and AI governance may accelerate solution development but slow the adoption of ethical standards for AI usage as various professional associations attempt to fill that void.
‘Invisible Healthcare’
The other more broadly adopted AI solutions have been in the areas of ambient listening and video monitoring. All indications are that this trend will continue into 2025 and beyond, as these offerings have proven their value in extending the capacity of physicians and providers while also getting very high marks from patients and families for improving their overall care experience. I expect the value of these solutions to continue to increase as the vendors add more AI-enabled capabilities in the back end without requiring additional hardware or infrastructure investment.
Data Privacy and Cybersecurity
This past year saw several high-profile and extremely costly cyberattacks and data breaches. As digital health continues to grow, cybersecurity threats will only escalate. To combat this, healthcare organizations have begun adopting blockchain and advanced encryption technology to increase the security of their EHRs and data. In 2025 the need will be even greater as the potential for loosening privacy regulations like HIPAA will increase data risk. We can also expect that policymakers in the incoming administration will favor commercial solutions as opposed to regulatory mandates, the cost of which will disproportionately impact the ability for smaller provider groups and health systems to keep pace.
Digital Health Consolidation
While the volume of digital health M&A deals was down this year relative to previous years, expect a rebound in 2025. Interest rates have been declining and the investment firms have capital reserves to deploy. The expected deregulation of mergers will create new opportunities for acquisitions, particularly for many of the large technology firms that have been making inroads in healthcare over the past several years. This should result in improved efficiency and innovation but could raise concerns about reduced competition and higher prices. Expect investors to continue to apply more scrutiny to deals and perhaps target a more diversified portfolio as opposed to doing fewer, larger deals. This would position smaller startups to fare better as acquisition targets, especially those offering specialized AI tools, cybersecurity solutions, or telehealth platforms.
Final Thoughts
Regardless of the political and regulatory environment, digital health technology will continue to advance, and adoption will continue to increase. It remains the single biggest area of opportunity for hospitals and health systems to better serve their patients, their employees, and their communities at scale. The rates of adoption and the demand for individual digital health solutions will vary by geography, hospital size, competitive environment, and dozens of other factors. Yet, the overall imperative remains for health system executives to stay on top of the latest innovations and trends, learn from their peers, and pursue a digital health strategy that will best enable their organization to fulfill its mission.
