The Covid-19 pandemic has brought immediate change to all of our everyday lives as we transform the way we live and work to react to the challenges we now face. We've witnessed a number of industries experience unprecedented technological adoption (such as the use of remote working collaboration tools), but perhaps none more so than the healthcare sector which has had to almost instantaneously pivot towards digital delivery overnight.

Prior to the pandemic just 15% of GP visits in the UK were delivered virtually, with this number surging to 95% during lockdown, according to GPonline. Now that patients have experienced 'Telemedicine' (the remote diagnosis and treatment of patients by means of telecommunications technology – typically a video consultation), 76% of survey respondents indicated they were highly or moderately likely to use such services going forwards. Clearly this increased level of adoption of Telemedicine was driven by patients not being able to visit a GP in person and therefore the pandemic created a necessity for healthcare to be accessed digitally.

We have also seen a paradigm shift in 'Telehealth' – the remote monitoring of vital signs data using self-assessment devices or wearable products. With patients wanting to avoid the risk of leaving their homes, Telehealth services have enabled patients to provide their health data, such as blood pressure, heart rate or blood sugar levels, allowing doctors to complete more assessments remotely and e-prescribe medications.

The adoption of such Technology Enabled Care Services ("TECS") has been underway for a number years – a change which has been widely considered inevitable. The development of TECS can be dated as far back as the mid-twentieth century, so the prospect is not new, but advancements in technology have been required to drive greater adoption. With the rise of cloud computing and the Internet of Things, and the improved functionality of middleware devices (such as Health / Fitness watches), the applications and quality of TECS was already rapidly evolving prior to the pandemic. With the foundation for mass adoption in place, the pandemic accelerated this process through necessity, bringing patients over the final hurdle to change the way they have traditionally received healthcare services to what may become the new normal.

Opportunities and Challenges for Disruptive Technologies

The pandemic created an unprecedented demand on the NHS and local care services on what was already considered a strained system. With an ageing population and an increasing number of people living with chronic conditions, in addition to the potential for increased respiratory issues post Covid-19, the requirement of technology to provide support to the healthcare system has never been greater.

This requirement has created the opportunity for technology to increase the access to and capacity of healthcare services by bringing the delivery of healthcare into a patient's home with the aim of reducing hospital visits through remote consultations. In addition, remote monitoring of patients provides the opportunity to improve the quality of care – helping to assist with preventative measures by identifying issues from monitored health data, to further reduce the burden and cost to the NHS and local care services.

Disruptive technologies are now being given accelerated support to meet the UK's demand for TECS, and even prior to the pandemic, the NHS had introduced its Long Term Plan, seeking ambitious improvements in TECS through the launch of NHSX - the largest digital health and social care transformation programme in the world.

Despite the extra support, technology still faces distinct challenges which have continued to drag on its widespread deployment across the UK's healthcare landscape. Investment, security, data privacy, interoperability of care providers and data sharing (i.e. Electronic Patient Records) are just some of the immediate challenges which have repeatedly acted as a barrier to the adoption of new technologies.

An Investor's View

Out of necessity the UK's health sector has become dependent on TECS – much in the same way as many of us are now dependent on collaboration tools such as Microsoft Teams to enable us to work remotely. TECS has demonstrated that it can improve the access, quality and capacity of care and is now receiving accelerated support to overcome the challenges which have held it back. This market dynamic has opened the door to disruptive technologies to take advantage of the significant opportunity to become embedded in both the public and private UK healthcare markets.

We continue to actively seek to invest in businesses which are using technology as an enabler to provide support services across markets, such as healthcare, which exhibit long-term growth opportunities. Beyond healthcare, we see opportunities for disruptive technologies in a broad range of end markets including E-learning, testing and inspection, supply chain / logistics and Business Process Outsourcing. We like to partner with ambitious management teams who have plans to drive growth and profitability in their business through the use of technology.

1 McKinsey Covid-19 Consumer Survey, 20 May 2020