[Lee Myung-ho's Future Preview] Digital Distributed Healthcare and Small to Medium Cities

Even with Higher Healthcare Spending in Developed Countries, COVID-19 Deaths Exceed Those in Developing Nations
Preventive Healthcare Spending Only 5%... Limitations of Hospital-Centered Medical Systems
Digital Health as the Future Solution... Bridging Healthcare Inequality Between Large and Small-Medium Cities

COVID-19 has once again reminded us how important healthcare is to humanity. Five years ago, at a global forum, people were worried about the prediction that automation through artificial intelligence and robots would eliminate 5 million jobs. Now, we are suffering from the loss of 500 million jobs, which is 100 times more. More than 3.2 million deaths have occurred, as if a world war had taken place, and the death toll continues to rise. The economic loss amounts to 444 trillion won globally every month. The development of COVID-19 vaccines gave hope that the pandemic would end, but we may face another pandemic within a few years.

The world has spent a lot on healthcare. The share of healthcare expenditure in advanced countries reaches an average of 8.8% of GDP according to the OECD. The United States spends as much as 18%, yet it shows higher COVID-19 infection and death rates than developing countries during the pandemic. This can be seen as a death sentence for the healthcare systems of advanced countries, including Europe. It is serious that healthcare systems protecting citizens' health and lives failed to respond properly, but looking at healthcare waste reveals how bloated the current healthcare system has become. According to one study, a quarter of U.S. healthcare spending (about $1 trillion annually, approximately 4.5% of GDP) is waste. This waste comes from administrative complexity, duplicate services, unnecessary treatments, high drug prices, and hospital readmissions. Although the U.S. has a private insurance system different from Korea’s public insurance system, this can be seen as a limitation of the current hospital-centered healthcare system.

Generally, about 80% of healthcare spending in hospital-centered systems is used for diagnosis and treatment. However, by 2040, 60% of healthcare spending will be used for prevention and health management. Currently, only about 5% is spent on prevention. The best way to reduce healthcare costs is to prevent and intervene before diseases occur or progress. However, annual health checkups are insufficient to achieve effective prevention. Digital technology offers a revolutionary way to overcome these limitations.

Digital health generally consists of six categories: mobile health, health information technology (IT), wearable devices, remote health management, telemedicine, personalized medicine, and digital therapeutics, mainly focusing on prevention and health management. This is why digital health is highlighted as a solution for future healthcare. Deloitte recently reported that actively adopting digital health and focusing on prevention and health management could drastically reduce healthcare costs. Under the current healthcare system, U.S. healthcare spending increases by about 5.3% annually, reaching $11.8 trillion by 2040, or 26% of GDP. However, with active adoption of digital health, the increase could be halted at the current level of 18.4% by 2040. This is a noteworthy prospect for Korea as well, where healthcare spending surged from 5.9% in 2010 to 6.9% in 2016 and 8% in 2019, increasing by about 9% annually.

Digital health can also solve another problem in our healthcare system. Medical inequality between large cities and small-to-medium cities is severe. The gap in life expectancy (Seoul: 83.3 years, Jeonnam: 80.7 years, a 2.6-year difference) and healthy life expectancy (Seoul: 69.7 years, Gyeongnam: 64.9 years, a 4.8-year difference) is large. This is due to the difference in the number of active doctors per 1,000 residents (Seoul Jongno-gu: 16.29, Gangwon Goseong-gun: 0.45). The difference in preventable deaths per 100,000 population is even greater (Seoul: 44.6, Chungbuk: 58.5; Seoul Gangnam-gu: 29.6, Gyeongbuk Yeongyang-gun: 107.8). The gap in emergency room arrival times for myocardial infarction patients (Seoul: under 150 minutes, Jeonbuk Jinan-gun: 410 minutes, a 2.7-fold difference) reflects how close comprehensive hospitals are. Ultimately, the number of doctors and comprehensive hospitals determine medical inequality. This healthcare gap leads to disparities in life and is also a cause of soaring real estate prices in the metropolitan area.

The government tried to alleviate medical inequality by strengthening the public healthcare system through establishing public medical schools and local medical centers, but lost momentum due to doctors’ opposition. In the current hospital-centered healthcare system, quantitative expansion may be a solution, but with the rapid development of digital health technology, it is insufficient as a solution for 10 to 20 years from now.

The value pursued by digital health is patient-centered preventive health management. It eliminates the need to visit hospitals and reduces the necessity of treatment-focused hospitals. Through precise examinations of genes and organs, physical information is modeled as a digital twin, and wearable devices like smartwatches monitor daily physical activities to predict disease occurrence using artificial intelligence. By advising appropriate health management activities tailored to individual physical characteristics, lifestyle, and environment (diet, exercise, air quality, etc.) and monitoring adherence, disease progression can be drastically reduced. Primary care physicians will check and manage individual health information daily with AI assistance, even if patients or residents do not visit hospitals. In line with the saying that a great doctor is not one who treats well but one who prevents illness, all doctors will become great doctors.

Comprehensive hospitals will transform into specialized hospitals for rare diseases or surgeries, while general patient care will be handled by local hospitals and primary care physicians. Local and specialized hospitals will share patient information, and patients who have completed surgery will be managed by hospitals in their residential areas. Emergency rooms will be distributed, with emergency-dedicated hospitals managing emergency rooms in local hospitals. This digital decentralized healthcare model is a future healthcare model envisioned by medical experts in advanced countries after experiencing COVID-19. This will resolve medical inequality between large and small-to-medium cities, allowing high-quality healthcare services in any region. We need to reconsider how to prepare for the future healthcare system.

Myungho Lee, Planning Committee Member, Yeo Si Jae Foundation