Healthcare Entrepreneurship in 2023
If entrepreneurship was an industry, it would be booming. Last year, 5.4 million new business applications were filed, surpassing the 2020 record by more than 1 million, according to NPR and Census Bureau data. Many of these new businesses will variously target the healthcare and wellness industries, which, according to Statista, now account for nearly 20% of the US economy. That’s up from just 5% in 1960.
If entrepreneurship was a startup, it would be large. Last year, 5.4 million new business applications were submitted, exceeding 2020’s record. Healthcare and wellness contribute for 20% of US GDP, up from 5% in 1960.
It’s no surprise, then, that major schools like George Washington University have been offering healthcare-focused MBA programs to fill the need for managers of corporate healthcare systems. As Baby Boomers continue to age into their senior years, they will no doubt provide ample fuel to continue the healthcare boom. Adding momentum is a post-Covid interest in wellness that encompasses everything from improving mental health and changing careers, to cosmetic procedures, fitness regimens, and novel therapies like Ketamine, IV-based nutrition/hydration drips, and even cannabis.
Sadly, due to long hours and missed family time, the holidays are not known as a time when corporate healthcare workers are their happiest or healthiest, so a lot of healthcare workers are already looking at entrepreneurial opportunities ahead of the New Year.
In 2023, we anticipate major advancements in healthcare driven by the following four trends:
Many of the changes in healthcare over the past few decades are a result of a paradigm shift, one in which patients are seen as consumers of healthcare products rather than people who need to be compassionately treated for a medical condition or injury. Indeed, just a few decades ago, it was rare for a hospital or medical practice to advertise its services. Now, the industry competes for consumer dollars everywhere and on every possible selling point, from convenience to quality to price to innovation. As more entrepreneurs enter the space, they are filling the void left by massive corporate healthcare systems that all too often treat every patient as a number on a P&L, rather than as humans that need and deserve holistic patient-centered care.
The evolution of medicine to a market-based model has spawned a number of healthcare-focused marketing agencies. This, in turn, has created a more healthcare-focused industry that speaks the healthcare language. Instead of going to a giant hospital system for an emergency or small procedure, for example, patients are far more likely to visit an urgent care clinic or specialized surgery center for care today. Once there, they will likely receive care from a highly-trained nurse practitioner or physician associate rather than an MD or DO.
Even as healthcare giants like HCA, UnitedHealth, CVS, and even Amazon have consolidated and vertically integrated their operations, there are still massive opportunities opening up for small private practices in areas such as IV Therapy, Aesthetics, Med Spas, Ketamine Therapy, and Direct Primary Care. And, given the increased stress in our lives thanks to Covid and inflation, there is an especially critical need for mental health services — both alternative and holistic.
According to a study released earlier this year by the US Department of Health and Human Services, roughly one in four medical consumers reported using telehealth services in the previous four weeks, up from nearly none pre-Covid. Even after President Biden declared the end of the pandemic in September of 2022, telehealth remains the future of efficiently delivered care, in large part because of its convenience for patients. Indeed, the move to remote medicine has inspired a raft of entrepreneurial ventures, from a telemedicine-based insurance company (Google-backed Oscar Health) to online pharmacies (Amazon’s PillPack), as well as various smartphone apps and technologies for storing and sharing electronic health records, or EHRs.
Of course, all of this innovation comes at a cost, but the value equation in healthcare is being disrupted, too. Both insurance companies and government programs like Medicare are shifting to models that pay for value over the traditional fee-for-service model. This new paradigm shift will continue to create massive opportunities in preventative care, such as wellness clinics that offer proven therapies for gateway conditions like depression and obesity.
It has long been said that an ounce of prevention is worth a pound of cure. The healthcare industry is finally waking up to this truth by prescribing preventative and alternative care regimens, and in a big way. For healthcare entrepreneurs, now is the time to get those innovative, value-added ideas in shape and out of the waiting room.