3 Recommendations for Building a Mobile App to Disrupt the US Healthcare System

The number of healthcare mobile app start ups is accelerating.

Last month alone, there were more than 70 healthcare mobile app companies newly registered on Angel.co. Certainly, there were even more on similar fundraising startup sites. I was also recently approached by two healthcare professionals interested in building mobile healthcare apps. As subject
matter experts, both had some interesting ideas, but were not well-versed in building digital products or partnering with major healthcare providers, payers and vendors – an ecosystem well known for its notoriously complex and entrenched structure.

Many of these newcomers are engineers with limited healthcare subject matter knowledge, or healthcare industry professionals with little to no startup or product development experience. Although industry experience is indeed important, I do believe “too” much experience can get in the way of
innovation as many professionals become jaded or closed in their thinking. They need practical digital product startup advice as they are up against stiff competition – corporate healthcare product development managers and marketers armed with large budgets and entrenched relationships who are
seeking innovation to retain their competitive advantage and grow revenue.

Here are three recommendations for developing new and disruptive products that penetrate this difficult market.

One: Avoid building an app that relies heavily on partnering or selling to payers or providers unless you’re an existing healthcare IT vendor in the space.

Healthcare IT is perhaps one of the most crowded and fragmented markets. There are literally thousands of technology, software and payment providers who have entrenched relationships with hospitals, medical providers and insurance companies. The market is extremely competitive and
challenging to penetrate. Unless you have some very compelling intellectual property with an ironclad patent proven to positively affect outcomes or create material system efficiencies, your chances of making a significant dent in the existing healthcare ecosystem are slim.

Existing technology providers are in position with multi-year provider and payer contracts, creating high barriers for competitors to enter and customers to exit. Their positions, along with their large war chests accumulated to drive brand awareness and penetrate markets, create meaningful barriers for even well- funded startups. Even with compelling IP, you would be wise to partner with one of the thousand or so health tech vendors with an existing sales and business development footprint – assuming they have not already started developing a competing product.

Two: Pre-sell your consumer mobile app concept at Starbucks

Yes, I said Starbucks. Digital products fail primarily because product managers at established businesses – as well as entrepreneurs – don’t spend the first weeks of their startup selling their product to targeted users. Yes, I said selling. Too many product people rely too heavily on their entrepreneurial instincts.

Today, improving patient outcomes, compliance and adherence is the mantra of healthcare. Healthcare consumer mobile app and digital product companies need to quickly validate their new product ideas with patients to stay competitive. You need to find and talk with prospective patients as soon as possible. Not your best friend, brother, girlfriend, a venture capitalist or a CEO.

Get out and meet with patients you believe have the problem your product concept solves. Visit a Starbucks. Test your assumptions and gather evidence by having open-ended conversations with the public – or even people in your LinkedIn and Facebook networks. Perhaps your solution is disease-state
specific, say for people with allergies. You may want to try an allergy blog or support forum or meeting. This will be the best time investment you could possibly make to help you reduce your financial risk and opportunity cost.

Three: Invite patients to your early Scrum meetings

Yes, that’s right; I said patients at Scrums. A Scrum is an Agile development planning meeting that occurs typically on a bi-weekly, tri-weekly or other iterative basis. The patient holds the key to the healthcare kingdom. Any healthcare mobile app that has a chance to meaningfully disrupt healthcare and effectively compete against the existing industry apparatus is going to be the one that the patient brings into the doctor’s office or hospital and says, “Have you heard about this app? I feel so much better since I started using it.”

It’s the patient, not the hospital, doctor or payer, stupid!

Invite a dozen or so people from your target market into your initial product discovery meetings and periodic Scrums for in-depth user story interviewing. This will allow your digital product team to garner information about the problem you are trying to solve and feedback on the product as you build it.

Patients are going to care very much about the product you are building, especially if it’s really going to help them feel better, recover, live longer or stay healthy. They are going to be acutely aware of which features are useful to them. Patients attending Scrums will help ensure you are building features that are in line with their expectations and priorities. This also gives you the ability to pivot if you are heading in the wrong direction, thus increase the odds of bringing your app to market.