Consumer, Non-Cyclical Future Reimagined: Consumerization of Healthcare - What's in Store?

Broadly defined, the consumerization of healthcare (CoH) is the trend of individuals asserting more influence and control over their medical & wellness care. To address this, non-traditional companies such as those in the retail, technology and consumer packaged good sectors are looking to address consumer & patient needs. This is likely to accelerate post COVID as consumers increasingly focus on health. In this report, which is part of a series that started with Future Reimagined: Propelled to The Thinking Economy, we explore the opportunities & obstacles of the consumerization of healthcare and which companies stand to gain across various sectors.

We see several factors. Patients are burdened with higher healthcare costs like rising out-of-pocket requirements & high deductibles. Plus, an aging population means healthcare needs are increasing. Simultaneously, technology & scale are allowing new entrants to serve this market. There are several outstanding questions including: how will pace of consumer awareness & adoption unfold, and how will payer mechanisms develop. Additionally, risks of data privacy are prevalent & will need to be managed.

We est. the addressable market for the CoH was ~$600 bn in 2019 and will increase at a 5.5% CAGR through 2025. Further, we believe that CoH already represents "at least" $50 bn (this number is likely conservative). In our base case, we assume that this amount grows 10% per year, increasing to $90 bn by 2025. Still, at that point, CoH would represent just over 10% of the total projected addressable market, suggesting room for upside.

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