Aetna, Apple Watch & the Integration of Wearables in Healthcare

Aetna, which provides health insurance coverage for 23 million Americans, recently decided that the wellness benefits offered by the Apple Watch make it a worthwhile investment to make for its customers. In a groundbreaking collaboration, Aetna will start subsidizing a portion of the cost of Series 2 Apple watches.The initiative is still in the launch phase, but Aetna reports that the unsubsidized portion of the cost for the device can be paid by way of several payroll deductions, making the purchase as affordable for customers as possible. Since Aetna's entry into this partnership is based on hard actuarial data, it is a powerful endorsement of the very real health benefits offered by these wearable devices.

Fitness Features Rejuvenate the Apple Watch Market

As the Apple Watch struggled to reach solid sales figures and the company battled some consumer confusion about its operating system, Apple marketers have kept an eye on the burgeoning success of Fitbit. Due to the increasing sophistication of its models, Fitbit managed to stake out a leading position in the health-related wearables market, while the Series 1 Apple Watch lagged behind.In direct response to this competition, Apple incorporated more features geared toward aerobic, fitness and exercise routines. The September, 2016, rollout of Series 2 watches highlighted that they're waterproof up to 50 meters and that their GPS can track runners' workouts. Nike and Apple are introducing a co-branded watch in the fall of 2016, showcasing the new watch's benefits for runners. According to Jeff Williams, Apple's chief operating officer, "We think Apple Watch is the ultimate device for a healthy life."

How the Apple Watch Directly Encourages Fitness

In its Series 2 Watch, Apple has introduced several wellness-related features, including a heart rate monitor, motion sensor and GPS. Combining the data it receives from these sensors with its formidable computing powers, the watch produces clear color-coded indicators of physical well-being. These indicators are more than simply passive information; they include active alerts and notifications, nudging the wearer to pay attention to the body's health needs.The watch's "Stand" notification, for example, reminds users to move around if they've been in one place for close to the last hour. The "Move" function calculates calories burned by physical activity, while the smart "Exercise" indicator learns the habitual patterns of users and sets goals just slightly beyond their typical daily patterns. In addition to encouraging more activity, the watch takes note of breathing patterns and reminds the wearer to take time for mindful breathing and relaxation sessions.

Leveraging the Power of iPhone Apps

The direct measurements the watch provides are only the beginning of its benefits, however. If those were the limits of what the Apple Watch could do, it would have more of a challenge differentiating itself from the new FitBit Blaze. While the functions of the watch independent of the iPhone are mainly focused on fitness, the real power of the Apple Watch springs from the nearly unlimited interactivity offered by its iPhone integration. The iPhone's Health app can collect information from the watch and make it available to third-party iPhone apps. Furthermore, the Apple Watch opens the door to a constantly evolving universe of new apps.

Aetna's Apps Add Targeted Value

Aetna's apps will nurture users' connections with the insurer, as well as support their general health. Through a set of iPhone and iPad apps that the insurance carrier is developing, customers with Apple Watches will receive medication and prescription refill reminders, insurance coverage information, related guides on staying healthy, and the ability to quickly consult a physician. "We look forward to using these tools to improve health outcomes and help more people achieve more healthy days," state's Mark Bertolini, CEO of Aetna. The insurance giant also noted that it will provide a free watch to employees who participate in its internal wellness program.

A Growing Marketplace for Wearables

Aetna's partnership with Apple is only the beginning of a potentially enormous digital collaboration. The recognition that digital devices can play an important role in maintaining health and well-being suggests that countless health-tech innovations are on the horizon. Here are just a handful of new ways that wearables and collaborative connectivity promise to enhance personal health:

• Health Care Originals is developing an intelligent asthma management system. The flexible, patch-type wearable comes with a rechargeable battery and can be worn anywhere on the upper torso. The device communicates with a mobile smartphone app, providing medication reminders, symptom tracking, journaling data, and HIPAA-compliant cloud storage for data.
• Tech company MC10 , which makes flexible body-worn sensors, is teaming up with L'Oreal to create a small tattoo-like patch called "MyUVPatch." This adhesive patch communicates with a smartphone app to help people monitor their exposure to UV radiation in sunlight.
• OMSignal's Sports Bra contains embedded sensors that read the wearer's body signals and transmit them to the company's proprietary OMrun app. The information transmitted includes breathing and heart rate, as well as "precise body movement metrics." With this information, the app delivers biometric-based coaching and analytics such as calorie consumption, pace maintained and distance covered.

"These kinds of devices have the potential to really affect how people make decisions to lead healthier lives," according to Vibhanshu Abhishek, Assistant Professor at Carnegie Mellon. Other large insurers are likely to take note of Aetna's decision, determining specific digital devices that can support and improve health. Fitbit has also been discussing plans to delve into the corporate wellness program sphere, putting extra pressure on Apple and prompting a more aggressive strategy. Its new Blaze is being compared with the Apple Watch, and undoubtedly, the two companies will maintain a sharp awareness of one another's marketplace positions.

Cautionary Research

According to a study published in the Journal of the American Medical Association, wearable devices failed to improve consumer weight loss efforts. The study showed that wearable users lost less weight over the two-year research period than subjects who didn't use wearables. However, such a study must be taken with a grain of salt, as many question the way the research was structured -- the devices used were not smart watches or currently marketed fitness trackers, and the group that wore the devices were not instructed to log the foods they ate.While the results of a single study are not conclusive, the takeaway is that the understanding of the human relationship with health-related technology is an evolving science. Reaction to all kinds of digital fitness devices continues to be enthusiastic, however, with the market for fitness trackers expected to exceed $5 billion by 2019.Wearable devices fuel society's embrace of a broader concept known as the "Quantified Self." By gathering data and properly analyzing metrics related to one's physiological behavior, better insight can be gained and healthier choices can be made. The Journal of the American Medical Association (JAMA) notes that these devices can motivate individuals to make beneficial lifestyle changes. Concepts from behavioral economics are being applied, including frequent feedback and intermittent rewards.

Challenges That Remain

The JAMA article notes that one challenge facing widespread adoption of health-related digital devices is cost, which often amounts to several hundred dollars per device. This barrier is addressed by Aetna's partnership with Apple. But, in the future, it may be important to expand such collaborations between manufacturers and insurers. Also, because the devices presume a baseline comfort with digital information, users tend to be younger, well-educated and urban.Even within this demographic, however, the adoption and continued use of health-tracking devices is still spotty; one survey found that half of all users who purchase a wearable device stop using it, and one-third discontinue its use within the first six months. The stumbling block these users cite most often is the need to stop and upload information periodically to another device. Clearly, these research results indicate a need for a more streamlined customer experience.Security is also a significant concern for some customers, especially when personal health data is digitally shared with insurers such as Aetna. In an effort to mitigate this worry, Aetna emphasizes its strict commitment to information security, but this assurance undoubtedly needs to remain front and center with all emerging technologies. Today's confusing health insurance terrain is causing the average consumer a certain amount of ongoing anxiety, and it is important to establish (and explain) robust layers of information security.

An Exciting Future Is Unfolding

What if a heart attack could be detected minutes or hours before it happens? This is an example of the ultimate benefit that consumers may glean through wearable devices one day. The ongoing advances in miniaturized circuits, wireless data transmission, sensor sophistication, and easily usable analytics all suggest an expanding future for health-related wearable technology. Devices like the Apple Watch are just one of many components that can help to reach that goal. Aetna's commitment to embracing wearable technology and encouraging end users to exercise control is commendable and will hopefully make great strides towards setting a precedent for other insurance providers.