The future is going digital—and healthcare is no different. 

Over the past two years, the digital healthcare space–a sector of healthcare including telehealth services, direct primary care, and other convergences of healthcare and technology, much like Nice offers–has exploded, with funding in 2021 hitting an all-time high record of venture capital funding. 

The COVID-19 pandemic accelerated this shift toward virtual and in-home healthcare services but the explosion in funding is also a testament to the changing landscape of the healthcare industry, at large. In this article, we’ll discuss why this happened, whether it’s going to continue, and what it means for you.

A Blockbuster Year for Virtual Healthcare

Last year, total funding for digital health startups across the U.S. hit $29.1B across 729 deals, with an average deal size of $39.9M–nearly double the sector’s previous record of $14.9B from 2020. And this explosion in funding was not unique to the U.S. On a global scale, 2021 saw digital health companies receive $57.2 billion in funding across 2,930 deals, an increase of 79% from the previous year. 

While some experts dismissed the increase in funding as signs of a bubble on the verge of bursting, others say it indicates the natural evolution of healthcare. We saw more companies adopting a value-based care model in lieu of a fee-for-service model last year, which shows an overall shift in the market. Some health startups expanded across product categories and adopted new infrastructure (i.e. data sharing) and more direct-to-consumer healthcare companies grew. These companies focus on more personalized, convenient, and cost-effective care–and better patient outcomes.

In other words, consumers want more direct, accessible (and affordable) healthcare, and more companies are meeting that demand.

Will the Virtual Healthcare Explosion Continue?

While the industry didn’t break any more records in the beginning of 2022, virtual and in-home healthcare adoption and funding are still growing. During the first quarter of this year, funding for U.S. digital health companies totaled at $6.0B across 183 deals, with an average deal size of $32.8M. This marked a sharp decrease compared to 2021’s fourth quarter total of $7.3B and 2021’s quarterly average of $7.1B. 

But some of this decline could be due to seasonality. Generally, the first quarter of the year is not a big time for funding, and there was an overall decrease in venture funding across the globe. Other potential variables include funding flowing to different sectors of the industry, supply chain and energy disruptions, the Russian invasion of Ukraine, and companies exiting the space. 

The Future of Healthcare Puts The Patient First

The acceleration in digital health funding is part of a larger movement happening across the healthcare industry toward providing more services in and around the home. Brick and mortar clinics are also moving toward virtual care to reduce the risk of spreading infection and allow patients to recover in the comfort of their homes. So the push to go digital is not stopping anytime soon.

Digital health services meet a need the conventional healthcare system has failed to address: all-inclusive, accessible primary care. Whereas many consumers may not have had access to primary care in the past, digital health companies are making that care more accessible, when and where you need it and often at a lower price. There is a growing demand for more personalized, convenient, and cost-effective care, and without a massive overhead. Digital health companies can meet patients’ needs where conventional clinics can’t thanks to technology as their main service vehicle. This is how digital health companies are disrupting the entire healthcare industry.

While certain variables may slow additional investment and adoption, digital health solutions offer tangible clinical and economic results–meaning improved patient outcomes and happier patients. The sky's the limit when it comes to the future of health.

Nice Healthcare is the Future of Primary Care 

Nice Healthcare is proud to offer virtual and in-person primary care services, virtual mental health services, and virtual physical therapy through our app at no out-of-pocket cost to you. We also offer 35 labs, 550 medications, X-rays and other imaging services. 

And you’ll never have to deal with a long wait time. The average response time through our app is under 6 minutes, and you can schedule a video or chat visit immediately. If an in-person visit is needed, you can almost always schedule it the same day.

If you’re a patient looking to schedule a primary care visit, click here.

If you’re an employer looking for more information on our digital health services, click here.