Digital platforms are powerful. 7 of the 10 most valuable companies in the world are powered by platforms. But...healthcare is late. Today in healthcare digital platforms are understood mostly as a technology construct. That's not wrong, but it is severely limiting. Tomorrow, platforms will be understood as central to operational and business strategy. Healthcare is just discovering network effects —the single biggest differentiator in platform success. Healthcare Platform Megatrend #1 -- SYNERGY Platforms advance (and are advanced by) 4 key healthcare trends. A McKinsey study from 2015 examined digital adoption across 22 industry sectors. Healthcare ranked #19. This helps explain why platform adoption in healthcare has been more than a decade late. We briefly describe 4 important healthcare industry trends: 1) Value based care and payment 2) Consumerism 3) Interoperability/data sharing 4) Home and virtual care Each of these trends is synergistic with platform adoption in healthcare, for example: Value based care and payment drives platform adoption, ...and, in turn, platform adoption drives value based care and payment. This creates a positive feedback loop — a flywheel effect. Healthcare Platform Megatrend #2 — Investment in digital health is fueling platform growth. Substantial investment in new digital infrastructure in healthcare is occurring. Platforms now account for greater than 40% of digital health investments. 1/3 of CB Insights Top 150 digital health companies are platforms. Platforms achieve a 2.8 x valuation premium. Healthcare Platform Megatrend #3 — Platforms are shaping new operational ecosystems. Healthcare is operationally challenged: 1) Tech infrastructure 2) Data model 3) Care model Platforms liberate data and consumer demand in each of these areas. Healthcare Platform Megatrend #4 — Platforms are transforming the competitive landscape in healthcare. Incumbents are besieged by a barrage of new platform competitors: virtual care platforms (VCPs), Big Tech, Big Retail, point-solution offerings, local/national health plans, hospital-at-home companies, second opinion programs, and others. Incumbents are fighting back — we're observing the rise of collaborative platforms, e.g., xealth, Truveta, GraphiteHealth. Today's point-solutions will be absorbed into or will build upon platforms. FHIR APIs are more than technical compliance mandate. Every healthcare organization should think of itself as a digital platform — and develop a supporting business model and strategy. Will healthcare see the emergence of mega-platforms and/or super apps? Over the course of a decade, we believe the answer is "yes". Today, the closest thing to a mega-platform in healthcare in Ping An Healthcare in China. We conclude on a note that is upbeat, provocative and aspirational: we believe healthcare will become the PINNACLE platform industry.

1. Healthcare Platform Strategy & Business Models e-CareManagement.com
Healthcare
Platform
Megatrends:
Discovering the Power
of Network Effects
Vince Kuraitis, JD/MBA
Better Health Technologies, LLC
vincek@bhtinfo.com
Randy Williams, MD
Digital Care Advisors, LLC
rwilliams@digitalcareadvisors.com
July 2022

2. 7 of the 10 most valuable companies in the world are
powered by platforms*
*Bain and Company, Platform Strategy, 2022 2

3. Survey* of health plan CXOs – objectives
for deploying digital platforms
Reducing administrative cost of care 38%
Managing risks & compliance 16%
Managing demand for healthcare services 10%
* HFS Research & Infosys, Enable cloud-native and AI-powered healthcare digital platforms, 2021
3
Today in healthcare: “Platform” as technology

4. “The single factor that separates a successful
platform from a failed one is the development
of network effects.”
--Sangeet Paul Choudary
4
Tomorrow: “Platform” as central to strategy

5. ●Platforms & Network Effects 101
●Setting Context – Platforms in Healthcare
●Healthcare Platform Megatrends
1) SYNERGY: Platforms advance (and are advanced by) 4
key healthcare trends
2) Investment in digital health is fueling platform growth
3) Platforms are shaping new operational ecosystems
4) Platforms are transforming the competitive landscape
in healthcare
5
Today’s Agenda

6. Platforms &
Network Effects 101
6

7. Stage 1 Stage 2 Stage 3
2016 Parker & Van Alstyne, with Choudary – licensed under Creative
Commons Attribution-ShareAlike 4.0 International (CC BY-SA 4.0).
Traditional linear value chain
7
Value Accumulation Flows Left to Right
Dollars Flow Right to Left

8. Traditional platform structure:
producers & consumers are outside the platform
CONSUMERS
PRODUCERS
PLATFORM
2016 Parker & Van Alstyne, with Choudary – licensed under Creative
Commons Attribution-ShareAlike 4.0 International (CC BY-SA 4.0).
Elements of value exchange
8

9. 9
1
connection
2 phones
10
connections
5 phones
66
connections
12 phones
More users = more value = more users…
Platforms leverage network effects
Source: Wikipedia.org
2016 Parker & Van Alstyne, with Choudary – licensed under Creative
Commons Attribution-ShareAlike 4.0 International (CC BY-SA 4.0).

10. 10
●Types of network effects
●Strength of network effects
●Potential for “winner(s)-take-
all” dynamics
●The chicken/egg (cold start)
problem
●Design & architecture
●Monetization
●Openness
●Governance
●Metrics
Platforms: Powerful but not so easy to build
Operational Considerations: Strategic Considerations:

11. Setting Context –
Platforms in
Healthcare
11

12. ●Healthcare – a human right or a market good?
●Complex
●Misaligned economic incentives
●Highly regulated
●Opaque (prices, quality, outcomes)
●Culture – controlling vs. collaborative
●Fragmented
12
Healthcare is different

13. Point-to-point
# of interfaces = (N2-N)/2
Platform Mediated Network
# of interfaces = N
Only 2 options for connecting network nodes
13

14. Can you imagine
Uber, Airbnb or
Amazon attempting to
operate point-to-point
via phone, fax, &
email?
We can’t.
14

15. Healthcare platforms & strategy are different
●More complex
─“Multi-multi” sided
─Hierarchical
●Network effects can be challenging
●Hybrid platforms (many forms)
●B2C beginning to emerge
●Broader scope/focus: Longitudinal and relational vs.
simply transactional
●Avoiding the dark side of platforms
15

16. HC PLATFORM
MEGATREND #1
SYNERGY: Platforms
advance (and are
advanced by) 4 key
healthcare trends
16

17. 2015 McKinsey study* of digital
adoption across 22 industry sectors:
Healthcare #19
17
Healthcare has been on a 25+ year journey toward
digitization, EHRs & interoperability
*McKinsey Global Institute, Digital America, 2015

18. 18
Forces driving platform adoption in healthcare
4 Key Healthcare Trends
Platform
Capabilities
Needed to
Support
Trends

19. Healthcare
Platform
Adoption
Consumerism
Interop/
Data Sharing
Value-Based
Care and
Payment
Virtual &
Home Care
SYNERGY:
 Trends
 Organizational
needs
 Platform
capabilities
19

20. HC PLATFORM
MEGATREND #2
Investment in digital
health is fueling
platform growth
20

21. 21
●90% of MDs and 99% of US
Hospitals have an EHR
●Big Tech investing in Healthcare’s
“Move to the Cloud”
●Oracle’s $28B acquisition of Cerner
●Microsoft’s $19B acquisition of
Nuance Communications
Healthcare’s digital infrastructure investment
If Data is the new “Oil”, then Digital Infrastructure is
the new “Drilling Rig”

22. 22
Exponential growth in Digital Health
Investment; $29.1 Billion in 2021
●25% YoY growth in number
of investors
●20% of firms making
multiple investments
●31 IPO’s or SPAC
acquisitions over past two
years
●Big Tech leveraging $500
Billion war chest to access
Healthcare market
Investment capital leveraging digital infrastructure
Sources: Rock Health; CB Insights; S&P Global; Summit Health; Modern Healthcare

23. Fueling rapid growth of platform investments
Platforms now account for
>40% of Digital Health
investments*
1/3 of CB Insights Top 150
Digital Health are Platforms
$1Trillion Total Addressable Market
2.8X Valuation Premium v. Digital Health
Source: Summit Health, Platforms in Digital Health 2021 Year End Report, 2022
23
23

24. Telehealth/ Virtual Care
Wellness and Caregiver
Support
Clinical Niches: Cancer,
Renal, Mental Health,
Reproductive
AI/ML Powered Diagnostics
and Provider Support
HC Platforms
24
Some sectors to watch

25. HC PLATFORM
MEGATREND #3
Platforms are shaping
new operational
ecosystems
25

26. Healthcare is operationally challenged
1) Tech Infrastructure:
• Facility based
• Lacks interoperability
• Providers spend 15 minutes per visit in EHR
2) Data Model:
• 0.036% of health data resides in EHRs
Provider/reimbursement/transaction centric
• Digital point solutions prevail
3) Care Model:
• Provider as gatekeeper
• Lacks coordination between specialists
• Sick care vs. Prevention/ wellness
• Facility based vs. Community based
Disparities of access
Workforce shortages
Provider burn out
Cost to value mismatch
Exacerbated by pandemic
26

27. 27
Platforms liberate data (and consumer demand)
1) Tech Infrastructure:
• Cloud native
• Interoperability standards (e.g., FHIR API’s)
• Data accessibility/ mobile friendly
2) Data Model:
• Consumer wellness centric
• Consumers HC data and beyond
• Digital point solutions giving way to
integration
27

28. 28
Liberated data and consumers drive new operating
models
3) Care Model:
• Platform as gatekeeper
• Whole patient view
• Virtual care; Home based care;
Virtual/ in person hybrid models
28

29. 29
Constraints:
Enablers, constraints and operational status
Enablers:
Healthcare is in a phase of operational model experimentation
Provider cultural shifts
Consumer-centric technology designs
Platform driven consumer experiences
outside of HC
Many opportunities for network effects
Healthcare is perhaps the MOST data rich
sector
Regionality of care services
Trust relationships are important
Highly complex informational environment
Countervailing incentives
Third party payment
Multi-sided relationships

30. HC PLATFORM
MEGATREND #4
Platforms are
transforming the
competitive landscape
in healthcare
30

31. 31
●Virtual Care Platforms (VCPs)
●Big Tech
●Big Retail
●Point-solution offerings
●Local/national health plans
●Hospital-at-home companies
●Second opinion programs
●…and more
Incumbents face a barrage of new platform competitors

32. 32
Incumbents fight back -- the rise of collaborative
platforms
See: Trend Spotting: Health Systems Unite to Build Collaborative Platforms (Part I), The Healthcare Platform Blog, 2021

33. ●Problem: thousands of specialized, digital health
point-solutions
●Platform world: specialization AND integration
are possible
●How?
─Absorbed into = merger
─Built upon = APIs & apps
33
Today’s healthcare point-solutions will be absorbed
into or will build upon platforms

34. FHIR APIs!
Every healthcare
organization should
think of itself as a
digital platform!
34

35. 35
Anticipate mega-platforms and super-apps
Company Introduction, PingAn Good Doctor, 2022
Healthcare mega-platform prototype: Ping An Healthcare

36. 36
40+ books on platform strategy & business models

37. Healthcare will become the PINNACLE platform industry!
●Strength of the value
proposition: life-or-death
●Volume, velocity & value of
data
●Consumers demand better UI
and UX
●Beyond data interop to
workflow interop
37
37