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Health Innovation Frontiers: Untapped Market Opportunities for the 50+

Health Innovation Frontiers for the 50+ | 29 March 2013 | © Parks Associates AARP Confidential – Not for distribution i

For more information: Keith Epstein [email protected] 50+ | 30

29 March 2013 FULL REPORT

AARP Confidential – Not for Distribution Keith Epstein, Senior Strategic Advisor, AARP Harry Wang, Director, Health & Mobile Research, Parks Associates 202‐434.6169. [email protected] Jennifer Kent, Research Analyst, Parks Associates


Significant unaddressed needs with the greatest potential for revenue, adoption and social impact


Health Innovation Frontiers for the 50+ | 29 March 2013 | © Parks Associates AARP Confidential – Not for distribution ii


Produced with Parks Associates Executive Editor: Tricia Parks Harry Wang, Director, Health & Mobile Product Research, Parks Associates Jennifer Kent, Research Analyst, Parks Associates Published by Parks Associates Copyright, January, 2013, Parks Associates Dallas, Texas 75248 All rights reserved. No part of this book may be reproduced, in any form or by any means, without permission in writing from the publisher. Printed in the United States of America.

Disclaimer Parks Associates has made every reasonable effort to ensure that all information in this report is correct. We assume no responsibility for any inadvertent errors.


Health Innovation Frontiers for the 50+ | 29 March 2013 | © Parks Associates AARP Confidential – Not for distribution iii


Table of Contents Attribution ................................................................................................................................................................... i

Disclaimer ................................................................................................................................................................... ii

Table of Contents ...................................................................................................................................................... iii

List of Figures .............................................................................................................................................................. v

Executive Summary ................................................................................................................................................... 6

1.0 Background and Scope of Report ..................................................................................................................... 9

2.0 The 50+ Market: Assessment of Needs and Existing Solutions ................................................................ 11

2.1 Living Safely and Independently ............................................................................................................. 12

Detecting falls .............................................................................................................................. 12

Preventing in‐home accidents ..................................................................................................... 13

Sending alerts when wandering or lost ....................................................................................... 14

Managing medications ................................................................................................................ 15

2.2 Aging with Vitality ................................................................................................................................... 17

Sharpening Memory/Improving Cognition .................................................................................. 17

Improving or Aiding Vision ........................................................................................................... 18

Improving or Aiding Hearing ........................................................................................................ 19

Maintaining Muscle Strength ...................................................................................................... 20

2.3 Maintaining a Healthy Lifestyle ............................................................................................................... 22

Eating Healthy .............................................................................................................................. 22

Engaging in Age‐Appropriate Exercise ......................................................................................... 23

Controlling Sodium Intake ........................................................................................................... 24

Improving Sleep Quality............................................................................................................... 24

Preventing Dehydration ............................................................................................................... 25

Boosting Daytime Energy ............................................................................................................. 26

Reducing Stress ............................................................................................................................ 27

2.4 Managing Health Risks and Conditions ................................................................................................... 28

Reducing Bad Cholesterol ............................................................................................................ 28

Keeping Glucose in Range ............................................................................................................ 29

Maintaining a Healthy Weight ..................................................................................................... 29

Keeping Blood Pressure in Range ................................................................................................ 30

Relieve Back Pain ......................................................................................................................... 31

Detecting Skin Problems .............................................................................................................. 31

Addressing Calcium Deficiencies ................................................................................................. 32

Maintaining Good Dental Hygiene .............................................................................................. 32

Managing Arthritis ....................................................................................................................... 33

2.5 Improving Quality of Life ......................................................................................................................... 34

Staying Connected Socially .......................................................................................................... 34

Keeping Mobilized ....................................................................................................................... 35

Navigating the Healthcare System ............................................................................................... 36


Health Innovation Frontiers for the 50+ | 29 March 2013 | © Parks Associates AARP Confidential – Not for distribution iv


Managing Healthcare Costs ......................................................................................................... 37

Evaluating Care Quality ................................................................................................................ 38

Receiving Divorce/Grief Support ................................................................................................. 39

Managing Life Phase Transitions ................................................................................................. 40

Planning for End of Life Care ....................................................................................................... 41

2.6 Evaluating Needs‐Based Challenges ....................................................................................................... 42

3.0 Evaluation of Leading Market Opportunities ................................................................................................ 45

3.1 Framework for Evaluating Opportunities ............................................................................................... 45

3.2 Comparative Assessment ........................................................................................................................ 47

3.3 Opportunities Addressing Medication Management ............................................................................. 48

3.4 Opportunities to Enable Aging with Vitality ............................................................................................ 50

3.5 Opportunities in Vital Sign Monitoring ................................................................................................... 53

3.6 Opportunities in Care Navigation ............................................................................................................ 56

3.7 Opportunities Enabling Emergency Detection & Response .................................................................... 59

3.8 Opportunities Addressing Physical Fitness ............................................................................................. 62

3.9 Opportunities Supporting Social Engagement ........................................................................................ 65

3.10 Opportunities Addressing Diet & Nutrition ............................................................................................ 67

3.11 Opportunities Addressing Behavioral & Emotional Health ..................................................................... 69

4.0 Market Forecasts, Investment Implications and Recommendations ........................................................... 71

4.1 Forecast Methodology and Key Assumptions ......................................................................................... 71

4.2 Market Forecasts and Investment Implications ...................................................................................... 74

4.2.1 Medication Management ............................................................................................................ 74

4.2.2 Aging with Vitality ........................................................................................................................ 77

4.2.3 Vital Sign Monitoring ................................................................................................................... 80

4.2.4 Care Navigation ........................................................................................................................... 83

4.2.5 Emergency Detection & Response .............................................................................................. 86

4.2.6 Physical Fitness ............................................................................................................................ 89

4.2.7 Social Engagement ....................................................................................................................... 92

4.2.8 Diet & Nutrition ........................................................................................................................... 95

4.2.9 Behavioral & Emotional Health ................................................................................................... 98

5.0 Summary and Conclusions ........................................................................................................................... 101

6.0 References ..................................................................................................................................................... 105

6.1 Selected Works Cited ............................................................................................................................ 105

6.2 Selected Statistical Sources ................................................................................................................... 106

Appendix A: Population Data ................................................................................................................................ 107

Appendix B: Parks Associates’ Data Highlighting 50+ Market ............................................................................... 108


Health Innovation Frontiers for the 50+ | 29 March 2013 | © Parks Associates AARP Confidential – Not for distribution v


List of Figures Figure 1: Healthy Living Needs of Consumers 50 and Older ................................................................................... 11 Figure 2: Thirty‐Two Needs Captured in Nine Healthy Living Challenge Areas ....................................................... 42 Figure 3: Leading Needs‐Based Healthy Living Opportunities in the 50+ Market .................................................. 44 Figure 4: Current Solutions Evaluation Matrix ........................................................................................................ 45 Figure 5: Market Opportunity Assessment ............................................................................................................. 46 Figure 6: Opportunity Evaluation Results ................................................................................................................ 47 Figure 7: Dominant Revenue Models for Market Opportunity Forecasts ............................................................... 72 Figure 8: Forecast Methodology ............................................................................................................................. 73 Figure 9: Summary of Nine Market Opportunities ................................................................................................ 101 Figure 10: Projected Revenue Ranges: Low/High‐end Market Opportunities ...................................................... 102 Figure 11: Market Opportunity Comparison ......................................................................................................... 103 Figure 12: Market Opportunity Ranking ................................................................................................................ 104 Figure 13: U.S. Population by Age and Sex, 2010 .................................................................................................. 107 Figure 14: U.S. 50+ Population Forecast, 2011‐ 2018 ........................................................................................... 107 Figure 15: Mobile Phone Ownership, by Age ........................................................................................................ 108 Figure 16: Attitudes Towards Technology, by Age ................................................................................................ 109 Figure 17: Consumer Use of Top Web Services, by Age ........................................................................................ 110 Figure 18: Healthy Living Behaviors Among 50+ ................................................................................................... 111 Figure 19: Number of Prescribed Medication Taken, by Age ................................................................................ 112 Figure 20: Challenges Taking Multiple Medications .............................................................................................. 113 Figure 21: Prevalence of Health Conditions, Among 50+ ...................................................................................... 114 Figure 22: Health Device Ownership, Among 50+ ................................................................................................. 115 Figure 23: Van Westendorp Pricing Analysis for Fall Detection Program ............................................................. 116 Figure 24: Van Westendorp Pricing Analysis for Medication Management Program .......................................... 117 Figure 25: Van Westendorp Pricing Analysis for Home Health Monitoring Program ........................................... 118 Figure 26: Satisfaction with Hospital Experience, Among 50+ .............................................................................. 119


Health Innovation Frontiers for the 50+ | 29 March 2013 | © Parks Associates AARP Confidential – Not for distribution 6


Executive Summary

Rarely has such an untapped opportunity existed to generate revenues for entrepreneurs,

investors and others in the private sector to generate revenues while meeting the greatest wants

and needs of a substantial, influential and important population. Favorable demographics, maturing

technologies, the consumerization of health care and increasing certainty surrounding the Affordable Care

Act are among factors that have converged to make the health market for consumers 50 and older extremely

attractive. This research finds that it is an opportunity that could within five years generate $20 billion in

additional revenues for entrepreneurs and investors while having a significant impact on the lives of 100

million people.

Despite this potential double bottom‐line – high‐impact investing that yields individual and social

benefits as well as a financial return – current market solutions are not meeting many of the

needs and desires of this key consumer demographic, which includes many people who yearn for

healthier, higher‐quality lives in which they can feel as empowered and independent as possible. Thus large

opportunities exist for new investment, development and deployment. Investors, entrepreneurs and other

players in the private sector who heed the knowledge and forecasts provided in this report will find

themselves in a unique position to innovate and adapt technologies and business models that can enable

them to reap substantial rewards while having a meaningful impact in the lives of people age 50 and older.

Some highlights from this research:

► Current solutions on the market suffer from common drawbacks that leave the door open for new

players to capture revenues in this valuable market. Common issues with current solutions include:

Poor aesthetics, which limits usability and consumer demand

A tendency to focus marketing on society’s sickest, most frail, and oldest, with an excessive focus

on chronic conditions, which creates an unnecessary stigma

The inability of devices to share data via the Internet or with other devices, which limits the

utility of collected data

The prioritization of younger demographics by solution providers using cutting‐edge technology,

which may signal to older consumers that such solutions are not designed for their use

Low awareness among mature consumers of many cutting‐edge solutions and services

High cost of direct‐to‐consumer solutions, pricing many older consumers out of the market

A fragmented approach to addressing older consumers’ needs when a more comprehensive

solution could drive higher usage

Designs that fail to incorporate the role of caregivers

► Nine areas of the healthy living market represent the best investment opportunities for break‐through

technologies, innovative products, and disruptive services. Together, these nine areas represent




potential adoption of new products and services for over 100 million people and as high as $20B in

revenue by 2018.

► Due to particularly favorable market conditions, three areas represent the best of these nine opportunities for new or greater investment:

o Medication Management: More than 90 million consumers 50 and older will be on two or more

medications by 2018 and more than half will need intelligent medication management solutions

by then. Current medication solutions fail by focusing rigidly on counting and dispensing pills or

sending reminders while overlooking the need to address the motivational factors of medication

compliance. An innovative solution that integrates easy pill identification, medication

consultation/education programs, and proper incentive for compliance could dramatically

improve medication compliance rate by benefiting as many as 35 million users and bring in

more than $3 billion revenues for entrepreneurs by 2018.

o Aging with Vitality: Close to 50 million people 50 and above will desire products and services

that help them age gracefully with vitality by 2018. Current products and services have done

little to take advantage of technology advances such as intuitive user interface design,

voice/gesture recognition, HD voice, and fail to provide a fun and interactive experience for

people of this particular demographic. New solutions, built on market‐tested technologies,

incorporating age‐appropriate user experience elements, and designed aesthetically

appealing, could garner interest from more than 30 million people 50+ and generate close to

$2 billion revenue for entrepreneurs by 2018.

o Vital Sign Monitoring and Management: The desire to understand chronic conditions and

proactively manage them for healthy living will be a high priority for approximately 50 million

people 50 years and older by 2018. They will be disappointed if future solutions are designed

and marketed like current ones—single‐purpose, poorly integrated, expensive, and uninspiring.

Improvement on these aspects of future vital sign monitoring and management solutions and

breakthrough products could jump‐start demand in the consumer market and benefit more

than 28 million people with such needs. A market opportunity up to $4.8 billion in revenue by

2018 is waiting for smart entrepreneurs and investors.

Together, the nine health innovation frontiers—from medication management to

behavioral/emotional health—represent a vast and under‐addressed market opportunity for

entrepreneurs and investors. Breakthrough technologies, innovative services, and disruptive business

models could bring new innovations to fruition and benefit more than 100 million people 50+ by

2018. The nine frontiers collectively represent as high as $20 billion in revenue opportunity by 2018.




Market Opportunity Summary

High‐end

Estimates

Low‐end

Estimates

Revenue

Variance

Highest

5‐Yr CAGR

Product

Sales

Monthly

Service

Technology/

Software

Ad

Sales

Medication Management 1 52M Up to 34M $3.3B $2.0B 1.64 16%

Aging with Vitality 2 49M Up to 42M $1.9B $1.2B 1.59 17%

Vital Sign Monitoring 3 49M Up to 28M $4.8B $2.3B 2.07 16%

Care Navigation 4 39M Up to 27M $3.3B $400M 8.36 23%

Emergency Detection & Response 5 28M Up to 15M $2.4B $1.5B 1.65 25%

Physical Fitness 6 42M Up to 22M $1.8B $1.2B 1.61 23%

Social Engagement 7 70M Up to 49M $1.0B $243M 4.26 23%

Diet & Nutrition 8 59M Up to 24M $1.6B $210B 7.61 20%

Behavioral & Emotional Health 9 29M Up to 24M $428M $145M 2.95 30%

Dominant Revenue Models

Opportunity AreaOverall

Ranking

Targeted

Users

(2018)

Projected

Users

(2018)

2013‐2018 Cumulative Revenues




1.0 Background and Scope of Report

As the Baby Boomer generation ages, the portion of the United States population age 50 or above is growing

rapidly. At the end of 2012, the 50+ population in the U.S. numbered 101 million and is expected to hit 113

million in 2018. The aging of the Baby Boomer generation brings with it certain challenges, particularly in the

areas of health and wellness, as well as opportunities. Rising rates of chronic illnesses, the desire of consumers

to live safely and independently in their own home, the increasing responsibilities of care givers, and

government healthcare reforms that incentivize consumer self‐care and the greater use of technology in

healthcare make this market ripe for investment.

It is the position of AARP, and independent research analysts at Parks Associates, that the healthy living needs of

consumers ages 50 and older are not being met by the market and large opportunities exist for new investment.

In addition the favorable demographics, a number of macro trends are driving the 50+ healthy living market

forward:

Technology is ready to disrupt the personal health and well‐being market. Parks Associates strongly

believes that after more than ten years of development, core technologies that have propelled the

growth of many industry sectors during the past decade are finally mature and ready to bring

innovations to the healthcare industry—traditionally a laggard in high‐tech adoption. Such technologies

include digital signal processing, networking protocols, Internet software, cloud computing, and

telecommunication infrastructure.

Healthcare stakeholders are increasingly strong believers in preventive care and population health .

Health care providers and payers now have more faith in technology‐supported personal health

products and services; some are aggressively pursuing a consumer‐centric care model driving health

behavioral changes across the care continuum. The consumerization of health care – people taking more

control of managing their health and well‐being – is being enabled by widespread broadband Internet

access, growing mobile health solutions, growing adoption of electronic health records by health

providers and new government initiatives that incentivize cost savings by pushing treatment away from

facilities and into the home.

There is less policy and legislative uncertainty surrounding healthcare reform. For the past three years,

market uncertainty associated with the implementation of the Affordable Care Act (ACA) passed in early

2010 has put a damper on healthcare stakeholders’ strategic plans,which in turn has complicated the

investment community’s market risk and opportunity assessments. With the Supreme Court finding the

major tenets of the ACA constitutional and President Barack Obama’s re‐election to a second term, it is

likely that the major overhaul efforts laid out in the legislation will move forward, which removes a

significant amount of business uncertainty for health stakeholders as well as for investors and

entrepreneurs.




Investors new to the 50+ healthy living market are likely challenged by some very significant business model

questions. Who should be our target popuation? What specific needs are critical to driving consumers’

purchase or usage decisions? What revenue models will be most effective for which products and services and

at what price points? The purpose of this report is to help investors gain insight on these points at a crucial

moment in this market’s development.

This report on Health Innovation Frontiers: Untapped Market Opportunities for the 50+:

1) assesses the healthy living needs of consumers 50 and older,

2) evaluates the ability of current solutions on market to address those needs,

3) identifies the best opportunity areas for new investments, and

4) provides 5‐year forecasts of adoption and revenue for the identified market opportunity areas.

This market assessment focuses primarily on consumer‐facing solutions and business models. As such, Parks

Associates analysts evaluate solutions and potential innovations that address healthy living but are not

medical or diagnostic in nature. Medical‐grade devices and pharmaceuticals do not fall into the scope of this

report, nor do those products or solutions that are merely cosmetic in nature.




2.0 The 50+ Market: Assessment of Needs and Existing Solutions

Taking a holistic view of the individual as he or she ages, Parks Associates identified over thirty needs of the 50+

population. All of these needs are common to a significant portion of the population and present at least one, if

not many, challenges to the ability of older adults to live a healthy, safe and independent lifestyle. These needs

fall broadly into five categories: living safely and independently, mitigating the common symptoms of aging,

maintaining a healthy lifestyle, managing health conditions, and improving quality of life. Each need is assessed

according to the problem or challenge it presents to older adults as well as the scope of the problem within the

50+ population. Additionally, an overview of current solutions designed to address the need is provided.

Figure 1: Healthy Living Needs of Consumers 50 and Older




2.1 Living Safely and Independently

Detecting falls

Falling in the home is a major problem among older people living independently. Stairs

leading to a second floor or to the basement, slippery bathroom floors, and walkways

around the home that are slick or uneven are hazards to people with mobility or balance

issues.

According to an analysis of injury episodes by the CDC, falls are the leading external

cause of injury among people age 65 and older, and the home is the most common place

for a fall to occur. These falls can result in major medical issues; people ages 65 and older

are three times more likely to be hospitalized as a result of a fall as those ages 25‐64.1

According to a separate CDC study of injuries sustained in bathrooms, one third of adults

age 65 and above who were injured in bathrooms were diagnosed with fractures and 38%

of adults age 85 and older were hospitalized as a result of their injuries.2 In‐home falls

also are a major concern among the adult children of older consumers: 71% of those

caring for, or anticipating caring for, an aging family member are concerned that that

person may fall and hurt themselves.3 Falling is especially dangerous for older adults who

live alone: in 2010, 19% of men and 37% of women ages 65 and older, or about 11.3

million people, lived alone.4

Current prevention techniques commonly pursued by seniors and their adult children

include easy and relatively inexpensive steps that involve physically altering the home.

Removing throw rugs, installing handle bars and a seat in the bathtub, and adding rubber

mats to stairs for better traction are common solutions to the problems of imbalance and

unsure footing experienced by many seniors.5

The most prevalent technological approach on market today for responding to falls is a

Personal Emergency Response System (PERS). The leading solutions from providers such

as Life Alert and Philips Life Line provide users with a panic button on a pendant or watch

that alerts a professionally‐monitored call center of an emergency when pushed. Parks

Associates estimates 1.8 million consumers used a PERS solution in 2011, or about 4.3%

1 CDC, “Injury Episodes and Circumstances: National Health Interview Survey, 1997‐2007,” Vital and Health Statistics, Series 10, No. 241 (September 2009). 2 CDC, “Nonfatal Bathroom Injuries Among Persons Ages ≥ 15 Years, United States, 2008,” Morbidity and Mortality Weekly Report, Vol. 60, No. 22 (June 2011); pp. 729‐733. 3 Parks Associates, Personal Health Tools and Applications, 2Q 2010. 4 Federal Interagency Forum on Aging‐Related Statistics, Older Americans 2012: Key Indicators of Well‐Being, Washington, D.C.: U.S. Government Printing Office, June 2012 5 Parks Associates focus groups with seniors and their adult children.

The Need

Population Data

Current Solutions




of the 65+ population. People 75 years and older are the primary users of PERS solutions,

accounting for 70% of the total user base.

In recent years, device manufacturers have introduced innovations to a relatively static

market. ADT and Mobile Help offer emergency monitoring outside of the home, for

instance, which is a major advancement over the in‐home‐only range of traditional PERS

devices. Philips, AMAC and other leading PERS providers are integrating automatic fall

detection into the panic button form factor so emergency services can be contacted even

in those cases where the user is unconscious or unable to press the panic button. Finally,

home monitoring sensors, such as those from Halo Monitoring or BeClose, can be

installed in users’ homes to detect falls and alert emergency services if necessary.

Preventing in-home accidents

The desire of older adults to live independently may be compromised by severe in‐home

accidents. While falls, discussed in the previous section, are the most common in‐home

accident among people age 65 and above, other in‐home risks include leaving the stove

on or candles burning, lawn care accidents, burns and cuts sustained while cooking or

performing common chores, poisoning from household chemicals or carbon monoxide,

and weather‐related health issues such as heat exhaustion and hypothermia.

Incidence rates of in‐home accidents naturally vary by type. The U.S. Census Bureau

reports 12% of adults ages 45‐64 and 15% of adults ages 65 and older were injured or

poisoned in 2009.6 FEMA estimates 1,000 senior citizens die in fires each year, many of

which are preventable.7 People 75 and older have double the national average rate of

dying in a fire at home, a rate that is more than tripled once people reach age 85.8 The

CDC reports 3,442 deaths from exposure to excessive heat or hypothermia for a four‐

year period between 1999 and 2003. People 65 and above accounted for 40% of the heat

and hypothermia deaths for which age information was available.9

Ensuring that batteries are working properly in smoke and carbon monoxide detectors

and checking in on elderly relatives and neighbors during severe weather events are

common prevention techniques.

New technologies on the market allow for remote monitoring, alert and control

capabilities. Wi‐Fi/Zigbee‐enabled smoke and carbon monoxide detectors currently on

market from Visonic and Kidde can send alerts to family members or emergency

6 U.S. Census Bureau, “Table 200. Injury and Poisoning Episodes and Conditions by Age and Sex: 2009.” 7 U.S. Fire Administration, “Home Fire Prevention and Safety Tips,” http://www.usfa.fema.gov/citizens/home_fire_prev/ 8 U.S. Fire Administration Topical Fire Research Series, “Older Adults and Fire” Vol. 1, Issue 5 (January 2001). 9 CDC, “Morbidity and Mortality Weekly Report,” July 28, 2006, 55 (29) pp. 796‐798.

The Need

Population Data

Current Solutions




responders if a concentration of either is detected. Similarly, connected thermostats

from Honeywell or the Nest can alert loved ones if the in‐home temperature is too hot or

cold; family members can adjust the temperature remotely if necessary. Safety sensors

from Cookstop and Guardian automatically turn off the stove and oven if left on for a

predetermined length of time (e.g., 15 minutes, 90 minutes). Companies such as

Wellaware Systems, GrandCare, and AFrameDigital also offer home sensors installed on

doors, under the chair, or underneath the bed sheet to monitor fragile adults’ in‐home

activities; if the sensors detect an abnormal pattern, these systems alert caregivers.

Sending alerts when wandering or lost

Memory loss is a common side effect of aging and a very serious symptom associated

with specific medical conditions like Alzheimer’s disease. Forgetfulness can cause in‐

home accidents, like those discussed above, and can cause confusion when away from

the home. Six out of ten people with dementia will wander from their homes, often

repeatedly. Still, even those suffering from some form of dementia who live alone prefer

to stay in their homes as long as possible, until their deteriorating condition requires a

safer living arrangement.

16% of women and 11% of men ages 71 or older suffer from some form of dementia. Up

to 60% of people with dementia will wander from their homes or living facilities.10 An

estimated 5.4 million Americans have Alzheimer’s disease today, 96% of whom are 65

and older. Alzheimer’s disease affects 12.5% of people 65 and older and 45% of people

85 and older; nearly twice as many women as men have Alzheimer’s. Due to longer life

expectancy and the aging boomer population, the Alzheimer’s Association projects

Alzheimer’s incidence rate to increase 30% by 2025 to 6.7 million people affected.11

800,000 people in the U.S. have Alzheimer’s disease and live alone.

Solutions to assist people who are lost or who wander from home are available from the

private sector and government programs. Twenty‐nine states have some form of

recovery program targeting missing seniors, often referred to as “Silver Alerts.” There is

movement at the federal level to provide similar support and funding for recovery

assistance for older people who are lost.

From the private sector, growing mobile phone adoption among seniors is addressing

some of this need.12 People who are lost or confused can call relatives or friends to help

orient themselves. Solutions from Healthsense and the Alzheimer’s Association use a

10 Medic Alert Foundation and Alzheimer’s Association, “Wandering: Who’s at Risk?”2012. 11 Alzheimer’s Association, “2012 Alzheimer’s Disease Facts and Figures,” Alzheimer’s & Dementia, Vol. 8, Issue 2. 12 According to Parks Associates data, 90% of adults ages 65 and older, who live in a household with broadband Internet access, own at least one mobile phone. Parks Associates, September 2012.

The Need

Population Data

Current Solutions




mobile phone’s GPS capabilities to determine when a person travels beyond a pre‐set

zone and alert care providers that he or she needs help; LoJack offers a similar service

using a proprietary bracelet design. Wireless door sensors also are available that can

alert a caregiver should a person with wandering issues leave the home unexpectedly.

Solutions to help caregivers of those with dementia are needed. Over 15 million people

provide unpaid care to a person, usually a family member or friend, with Alzheimer’s or

other forms of dementia. On average, caregivers spent 21.9 hours per week providing for

those with Alzheimer’s.13 Top caregiving tasks include helping the person with mobility

issues (getting in and out of bed, dressing, bathing, feeding, etc.), instrumental activities

of daily living (shopping for groceries, preparing meals, providing transportation, doing

laundry, etc.), and performing household chores, among others. 61% of caregivers report

the emotional stress of caregiving is high to very high and the physical stress of caregiving

is high to very high.14 Solutions designed to help caregivers manage these tasks will find

an underserved market.

Managing medications

Managing a prescription medication regimen can be difficult for many older Americans.

Medication non‐compliance is a serious healthcare problem which can render patient

treatment ineffective while drug interactions can cause serious health complications.

According to Parks Associates data15, 70% of people ages 50‐64 and 87% of people ages

65 and older take at least one medication on a regular basis. 57% of those ages 50‐64 and

74% of those ages 65 and older take multiple medications. Among adults ages 55‐64, 19%

report forgetting to take their medications and 11% report running out of medication

because they did not refill their prescriptions. Among people 65 and older, these rates

decline to 11% and 5% respectively. In excess of 2 million serious adverse drug events

and about 100,000 deaths occur annually due to medication problems, according to the

Center for Technology and Aging.16

The most common solution consumers use to manage their medications is a physical

organizer, usually in a pill box format. Pill organizers are cheap and widely available, but

require consumers to correctly organize their medications according to their physician or

pharmacist’s instructions.

13 Alzheimer’s Association, “2012 Alzheimer’s Disease Facts and Figures,” Alzheimer’s & Dementia, Vol. 8, Issue 2. 14 Ibid. 15 Parks Associates, Multiple Medication Management and Smart Pill Boxes, Q1 2012. 16 Center for Technology and Aging, “Technologies for Optimizing Medication Use in Older Adults,” September 2011.

The Need

Population Data

Current Solutions




Mobile applications address a number of medication management issues, such as

identifying pills, providing information on common side effects, scheduling medication

reminders, and alerting users of potential drug interactions. Applications like GreatCall’s

Jitterbug medication reminder service, Montuna Software’s DoseCast app and Vocel’s

ThePillPhone app also alert users when prescriptions need to be refilled and connect

users to their pharmacies. These applications are cheap and user‐friendly, but many

require the user to own a smartphone and rely on consumers to manually enter accurate

medication and dosage information.

New solutions also track the consumer’s medication compliance. Vitality GlowCaps fit

over standard prescription bottles and detect when a user opens the bottle. Caps flash

and play a ring‐tone if a user skips a dose, in which case Vitality can call the user and

email a report to family members or care providers. OtCM produces RFID labels that,

when applied to a standard medication blister package, detect when pills are removed

from the packaging. The data can be collected by an NFC‐enabled mobile device or the

OtCM EventTaker located at a pharmacy. Like other solutions, OtCM also offers SMS,

phone and email reminders as well as a web‐portal to show users and their care

providers their medication compliance data.

Other solutions attempt to remove the consumer from certain medication management

tasks: InRange’s Emma device is programmed remotely by a health provider to dispense

medication in the user’s home and SentiCare’s PillStation remotely monitors medication

compliance by using pictures of the medications as they are distributed. Proteus Digital

Health has developed perhaps the most innovative solution: sensors that communicate

with a body‐worn patch are incorporated directly into the medication and pass health

data along to the patch when the medication is ingested. Proteus’ ingestible sensors are

FDA approved.

Finally, home monitoring solutions like door sensors can be applied as medication

compliance solutions. Wireless sensors connected to the medicine cabinet, for instance,

could alert a family member if the cabinet was not opened by a certain time of day and

so an older parent has not yet taken his or her pills.




2.2 Aging with Vitality

Sharpening Memory/Improving Cognition

Studies17 suggest that most people suffer some decline in their cognitive abilities by age

60, with larger declines by age 75. Older adults have more trouble problem solving,

process information more slowly, and have a shorter attention span than younger adults.

Furthermore, process‐based intelligence declines earlier than intelligence based on

accumulated knowledge.

Along with a general decline in cognitive abilities is the general memory loss many older

adults suffer as they age. As discussed in Section 2.1, memory loss is also a serious

symptom associated with Alzheimer’s disease and other dementias. Forgetfulness affects

older adults’ daily lives and can cause serious health emergencies due to in‐home

accidents and wandering away from home.

Intellectual or cognitive decline varies among individuals as they age, and older adults

can better maintain their cognitive abilities if they received high levels of education,

worked intellectually demanding or complex jobs, are physically fit and eat a balanced

diet. Cognitive decline affects those who are socially isolated or relatively inactive more

severely.

According to the New England Journal of Medicine, 10% to 20% of people older than 65

suffer from Mild Cognitive Impairment (MCI).18 MCI is considered to be among the

earliest stages of cognitive decline, experienced before Alzheimer’s disease or other

advanced dementias. A study conducted by physicians at the Mayo Clinic found that 19%

of men and 16% of women ages 70‐89, who were not suffering from dementia, showed

signs of MCI.19

According to a U.K. study published this year in the British Medical Journal, memory

begins to decline as early as age 45.20 Studies show that about 5.4 million, or one‐third,

of people over age 70 suffer from memory loss that disrupts their regular routine.21

17 Kristine Williams, Susan Kemper, “Exploring Interventions to Reduce Cognitive Decline in Aging,” Journal of Psychosocial Nursing and Mental Health Services, Vol. 48, No. 5 (May 2010): pp. 42‐51. 18 Jane E. Brody, “When Passes are Not Just Signs of Aging,” The New York Times, September 5, 2001. 19 Peggy Vaughn, “Mild cognitive impairment more common in older men than older women,” NIH National Institute on Aging Press Release, September 7, 2010. 20Francine Goldstein, “How early can cognitive decline be detected?” British Medical Journal, January 5, 2012. 21 University of Michigan Institute for Social Research, “One in Three People Over 70 Have Memory Impairment.”

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Older consumers seeking intellectual stimulation engage in common activities like

reading books and newspapers, completing puzzles, or attending continuing‐education

classes designed for older adults.

New online services aim to improve the memory and cognition skills of older adults.

These solutions are typically designed as games, puzzles or other cognitive challenges.

Nintendo’s Brain Age is among the top grossing brain health games, selling more than 17

million copies globally since its release in 2005. Lumosity, a subscription‐based online

brain game portal, is also very successful, with an estimated 20 million registered users

generating approximately $80‐$90 million in revenue during 2011. Solutions from Vivity

Labs, Posit Science, Happy Neuron, CogniFit, Dakim and others offer memory games, as

well as games aimed at improving players’ focus, reaction time, hand‐eye coordination,

processing abilities, and language skills.

Rather than attempt to improve older adults’ memory, new solutions also aim to help aid

a consumer’s memory, many of which address prospective memory, or the ability to

“remember to remember”.22 Analog prospective memory aids would include to‐do‐lists,

calendars and reminders jotted down on post‐it notes. New solutions addressing

prospective memory include online and mobile solutions that send email alerts or text

messages to remind an older adult to perform a certain task, like taking medication or

buying eggs at the grocery store. Astrid is an online and mobile app that allows users to

construct to‐do‐lists and cross‐off tasks once they are completed; to‐do‐lists can be

collaborative so other household members or caretakers can add or delete tasks from

the list. Prospective memory aids are incorporated into many other solutions that are not

dedicated as a memory aid: medication management solution Vitality GlowCaps, for

instance, flash and play a sound if the user forgets to take his or her medicine.

Other solutions target retrospective memory, or things learned in the past. Technologies

that address retrospective memory might include pictures or videos of a task performed

at an earlier time that can serve as a “how to” for future action. Cooks Collage is one such

example – it extracts pictures from video taken of a person cooking a particular recipe

and creates a visual summary of the steps required to recreate that dish.

Improving or Aiding Vision

Between the ages of 40 and 60, people commonly experience problems seeing in low

light, problems with glare off of reflective surfaces, reduced tear production, changes in

color perception, and Presbyopia – the loss of the ability to see close objects or small

22 Niamh Caprani, John Greaney, Nicola Porter, “A Review of Memory Aid Devices for an Ageing Population,” PsychNology Journal , Vol. 4, No. 3 (2006), pp. 205‐243.

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print.23 More severe vision problems are likely for adults ages 60 and above, including

Cataracts, Glaucoma, Age‐related Macular Degeneration (AMD), and Diabetic

Retinopathy. Vision difficulties negatively affect an individual’s ability to perform basic

everyday tasks, especially driving. Poor depth and color perception could also increase

the risk of in‐home accidents such as falls, burns and cuts.

Presbyopia affects everyone to some degree after the age of 45. Among Americans age

40 and older, 17% have Cataracts, 7% have AMD and 2% have Glaucoma.24 Among the

same age group, 25% suffer from Myopia (nearsightedness) and 10% suffer from

Hyperopia (farsightedness); 2% have low vision and about 1% are blind.

Solutions to assist people with declining vision include magnifying glasses, large key

stickers for computer keyboards, and “talking” versions of everyday items such as

calculators, clocks, and scales. Smartphones now feature flashlight and magnifying apps

to aid vision and most personal computing device (computers, tablets, e‐readers, etc.,)

feature adjustable font sizes. Many mobile devices also have text‐to‐speech capabilities,

which read emails, messages and other text out loud. New advancements in voice‐

recognition and motion‐sensing technologies can help those who have trouble typing or

seeing small buttons. Apple’s Siri technology, for instance, allows users to set calendar

reminders through voice activation. Instead of using a remote with many small buttons,

Microsoft’s Kinect technology could allow users to change channels or adjust the volume

on the TV using hand gestures.

Improving or Aiding Hearing

Hearing loss is common for many adults and can result as a natural consequence of the

aging process (Presbycusis), or as a result of exposure to loud noises. Hearing loss can

impair a person’s ability to engage others in conversation and to conduct everyday

activities, such as driving, safely. People with hearing loss are less likely than others to

participate in social activities, and are less satisfied with their friendships, family life,

health and financial situation.25

According to the National Institute on Deafness and Other Communication Disorders, 18%

of people 45‐64 years old, 30 percent of those 65‐74 years old and 47% of those over age

23 American Optometric Association, “Adult Vision: 41 to 60 Years of Age.” 24 National Eye Institute, “Prevalence of Blindness Data.” 25 National Academy on an Aging Society, “Hearing Loss: a growing problem that affects quality of life,” December 1999.

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75 experience some hearing loss.26 Two‐thirds of Americans 65 and older with hearing

loss do not use hearing aids, citing costs and image as barriers to use.

In addition to medical‐grade hearing aids, various sound amplifiers on market help the

hearing‐impaired detect and recognize noise. Some amplifiers are designed to increase

the volume of specific devices or noises – such as a telephone ring – while personal

sound amplifiers that fit in a user’s ear amplify and clarify soft sounds while filtering

background noise. Personal devices from cell phones to watches and alarm clocks now

come with vibrating features to alert users of an incoming call or alert. Cell phone

manufacturers that target older populations, such as GreatCall, feature high‐volume

speaker phones and superior call quality. Overseas, mobile phone carriers such as

Deutsche Telekom and Telestra have launched high‐definition voice service, which will be

available from U.S. carriers in the 2013‐2014 timeframe.

Maintaining Muscle Strength

As people age, their bodies gradually lose the ability to maintain skeletal muscle function

and mass – a condition known as “sarcopenia”. The loss of muscle strength associated

with aging can lead to reduced mobility, declining activity, and dependence on others. It

can also result in balance problems, a greater risk of falling, and an increased risk of

osteoporosis. Maintaining muscle function and strength while aging is a great

preventative measure against disability and a proven way to enhance healthy living.

A meta‐analysis of studies on resistance training in adults finds that “there is strong

evidence to indicate that muscle weakness is a treatable cause of disability, and that

aging persons with early‐onset deterioration are probably the most likely to benefit from

strategic interventions.”27 The American College of Sports Medicine (ACSM) also

recommends adults engage in a resistance‐training program to build and maintain

muscle mass and function.28 Older adults should engage in exercise programs under the

supervision of their caregivers and follow programs that are progressive in nature,

individualized and involve all major muscle groups.29

26 National Institute on Deafness and Other Communication Disorders, “Quick Statistics,” http://www.nidcd.nih.gov/health/statistics/Pages/quick.aspx. 27 Mark D. Peterson, Matthew R. Rhea, Anada Sen, Paul M. Gordon, “Resistance exercise for muscular strength in older adults: a meta‐analysis,” Aging Research Reviews 9 (2010) 226‐237. 28Kent J. Adams, “Strength, Power and the Baby Boomer,” ACSM Current Comment, American College of Sports Medicine. 29 Michael G. Bemben, “Physiology of Aging,” ACSM Current Comment, American College of Sports Medicine.

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The U.S. Census Bureau reports that 20% of adults age 45‐64, 13% of those ages 65‐74

and only 12% of those 75 and above engage in regular muscular strength and endurance

exercises.30

The fitness market provides ample solutions to assist consumers in building muscular

strength. These include fitness equipment – such as dumbbells, resistance bands and

large multi‐exercise machines – as well as fitness classes focused on building or

maintaining muscle strength.

New technologies on market are designed to assist, track and motivate consumers of all

ages to engage in physical exercise, though solutions targeting aerobic activities

dominate the market. An overview of new fitness solutions is provided in Section 2.3,

under “Engaging in Age‐Appropriate Exercise.”

30 U.S. Census Bureau, “Table 212. Age‐Adjusted Percentage of Persons Engaging in Physical Activity and Fitness by Selected Characteristics: 2008,” Statistical Abstract of the United States: 2012.

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2.3 Maintaining a Healthy Lifestyle

Eating Healthy A nutritional diet is a fundamental aspect of living and maintaining a healthy lifestyle,

regardless of age. The Academy of Nutrition and Dietetics recommends eating plenty of

fruits and vegetables, varying protein choices, consuming at least three ounces of whole‐

grains daily and at least three servings of low‐fat dairy products. As people age, however,

certain nutrients – such as calcium, vitamin D, vitamin B12, fiber and potassium– become

particularly important to maintaining good health. The Academy also recommends older

adults limit their sodium intake and consumption of saturated fats.

Unfortunately, poor eating habits can leave older adults overweight or malnourished.

Poverty, depression, and social isolation can decrease appetite, as can changes in taste

and smell that are common with age.31 People with certain diseases and those taking

medication may have dietary restrictions that can be confusing and difficult to follow.

In 2010, 43% of men and 45% of women ages 65‐74 were obese; 27% of men and 30% of

women 75 and older were obese.32 Estimates for poor nutrition and malnutrition among

older adults range from 15‐50%. Data from the CDC’s National Health and Nutrition

Examination Survey show only 17% of adults 60 or older consume a good quality diet, 30%

skip at least one meal per day, and 16% consume fewer than 1,000 calories per day.

Basic nutritional and dietary guidelines for older adults are widely available online from

credible sources such as the National Institutes of Health and the USDA.

Weight loss programs such as Weight Watchers and SparkPeople help consumers

understand their nutritional needs and plan their meals accordingly. Some weight loss

programs, like Nutrisystem, ship balanced meals to subscriber’s homes. Online portals

and mobile applications, such as MyNetDiary.com and Livestrong’s Calorie Tracker, serve

as digital food journals that help users track their caloric intake, set goals and monitor

their progress.

Mobile apps such as Meal Snap, the Eatery, and SnapDish Food Camera let users take a

picture of a meal with a smartphone, the app automatically calculates the calories and

nutritional content of the food, and enters the data into the user’s food diary. Many

online and mobile diet aids are positioned as weight‐loss tools and are not designed to

advise or assist a person with specific dietary needs.

31 Donini, Savina and Cannella, “Eating habits and appetite control in the elderly: the anorexia of aging.” International Psyogeriatrics Vol. 15, No. 1 (March 2003): pp. 73‐87. 32 Federal Interagency Forum on Aging‐Related Statistics, Older Americans 2012: Key Indicators of Well‐Being, Washington, D.C.: U.S. Government Printing Office, June 2012

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Engaging in Age-Appropriate Exercise Along with eating a healthy diet, regular exercise forms the foundation of healthy living

for older adults. Consistent exercise can prevent or lessen the impact of many diseases

and can help older adults manage stress and improve cognition. Additionally, group

exercise classes can be a great form of social engagement.

The CDC reports that only 33% of adults ages 65‐74 and 17.5% of those 75 and older

engage in regular leisure‐time physical activity; 32.7% of Americans ages 65 and older

engaged in no leisure‐time physical activity.33 Parks Associates data shows that 45% of

people age 55‐64 exercise indoors or outdoors at least once a week, a rate which

increases to 54% of people 65 and older.34

Solutions assisting older consumers to exercise on their own – in and around the home –

or at a fitness facility are widespread. These include fitness devices as well as fitness

classes and personal training services. Basic information on how to engage in age‐

appropriate or condition‐appropriate exercise is available online from health and

wellness‐related websites, and often from physicians or physical therapists’ offices.

Some traditional fitness equipment manufacturers have started to integrate online

fitness programs with their equipment. iFit.com allows users to insert a Wi‐Fi enabled

memory card into an iFit‐compatible fitness equipment – often from major brands such

as NordicTrack. The card can download, store and update user‐selected fitness programs

from iFit.com.

Smartphone applications such as Fleety provide users with strength training workouts,

including videos showing proper form, and allow users to track their progress towards

fitness goals. Fleety and fitness‐tracking app Endomondo also provide motivation by

allowing users to set up competitions with peers. Endomondo has partnered with

municipalities and employers to launch fitness competitions among employees, a

strategy that could be extended to senior living communities.

Major fitness brands and some new comers also are developing wearable fitness devices

that go beyond the traditional pedometer. Nike, Adidas, Jawbone, Basis and BodyMedia

offer watches, armbands, athletic shoes and bracelets that can monitor, track and

analyze a user’s fitness progress.

33 CDC, “Data Table for Figure 7.2 Percentage of adults aged 18 years and over who engaged in regular leisure‐time physical activity, by age group and sex: United States, January‐September, 2009,” Early Release of Selected Estimates Based on Data From the January‐September 2009 National Health Interview Survey. 34 Parks Associates, Managing Care through ACOs: Consumer Interests & Requirements, December, 2012.

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Finally, game consoles are making headway into the physical fitness market. The top

three game console manufacturers, Nintendo, Sony and Microsoft, all offer gaming titles

that work with motion sensors and other accessories to make physical fitness more fun

and appealing.

Controlling Sodium Intake Excess sodium in a person’s diet can result in high blood pressure (hypertension), which

increases the risk of heart disease and stroke. The CDC recommends no more than 1,500

mg of sodium consumption daily, but the average American consumes more than double

that amount. The sodium content of many foods can be difficult to ascertain, especially

for meals consumed at restaurants, and older adults who are less mobile may rely too

heavily on processed foods that are high in sodium as opposed to fresh foods that expire

more quickly.

The CDC estimates 90% of Americans eat more sodium that is recommended for a

healthy diet.35 According to CDC’s National Health and Nutrition Examination Survey, 64%

of men and 69% of women ages 55‐64 years old suffer from hypertension, as do 72% of

men and 81% of women 75 and older.36

There are few solutions available to help consumers easily understand, track and manage

their sodium intake. Some online food diaries, like those profiled above, provide

estimates of sodium contained in popular food items. Popular online recipe and health

websites also provide ideas for consumers to prepare low‐sodium meals. The Mayo Clinic,

for instance, provides hundreds of recipes with no more than 140 mg of sodium per

serving.

Improving Sleep Quality Insufficient sleep can have serious negative effects on a person’s physical and mental

health, as well as his or her ability to perform daytime activities that require energy and

focus. Common causes of insufficient sleep among older adults include anxiety,

medication side effects, and health problems, like sleep apnea or restless leg syndrome.

Older adults are also more likely to suffer from advanced sleep phase syndrome (ASPS),

which causes the body to want to sleep earlier than normal.

35 CDC Vital Signs, “Where’s the Sodium?” February, 2012. “http://www.cdc.gov/vitalsigns/Sodium/index.html 36 CDC, “Table 70. Hypertension among persons 20 years of age and over, by selected characteristics: United States, selected years 1988‐1994 through 2007‐2010,” Health, United States, 2011, With Special Feature on Socioeconomic Status and Health, 2012.

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What’s the Need?




According to the U.S. Census Bureau, 27% of adults ages 45‐64 and 15% of adults ages 65

or older did not get enough sleep 14 or more days out of the month.37 ASPS is quite rare,

estimated 1% of the population. According to a study conducted by the CDC38, 39% of

adults ages 45‐54, 34% of adults ages 55‐64, and 24.5% of adults ages 65 and older slept

less than 7 hours in a 24‐hour period. 59% of the 45‐54 age group, 62% of the 55‐64 age

group and 50.5% of those 65 and older reported snoring – a major indicator of sleep

apnea.

A common strategy to promote sleep is to play relaxing music, whether though an alarm

clock, mobile device, or stand‐alone ambient noise player. Top sleep‐aiding mobile

applications instruct users to engage in breathing exercises or medication to relax before

bedtime, or provide sleep diaries to track the user’s length and quality of sleep, based on

data manually inputted by users.

Some sleep tracking apps have automated sleep data collection. Sleep Cycle and Sleep

Bot Tracker, which require the user to place his or her smartphone under the pillow,

monitor sleeping patterns and only sound an alarm to wake the user when he or she is in

a light sleep phase. Wearable devices like the Wakemate wristband, Fitbit Aria, or the

Zeo headband similarly track sleep patterns and relay the data to a smartphone or tablet

app. These apps allow users to manually input relevant data about the environment

(location, light conditions, etc.) in which they slept on any particular day as well as

personal feelings and behaviors (stress, diet, exercise) in order to produce more

meaningful sleep analysis.

Preventing Dehydration Older people are more susceptible to problems caused by dehydration, or the loss of

bodily fluid. Aging tends to make people 50 and older less aware of thirst and also

gradually reduces the body’s ability to regulate its fluid balance. Dehydration can

aggravate symptoms for people suffering from diabetes, heart failure, or COPD, and can

lead to complications such as low blood pressure, convulsion, severe cramping and

muscle contractions, faster breathing, or rapid but weak heart beat. Older adults who are

severely dehydrated may require hospitalization.

37 U.S. Census Bureau, “Table 195. Insufficient Rest or Sleep by Number of Days and Selected Characteristics: 2008.” 38 CDC, “Unhealthy Sleep‐Related Behaviors,” Morbidity and Mortality Weekly Report, Vol. 60 No. 08 (March 2011): pp. 233‐238.

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Researcher Janet Mentes found that 48% of older adults admitted to hospital emergency

departments were dehydrated.39 Another study by A.K. Kant shows that 63% of people

ages 65‐74 and 81% of people 85 and older failed to meet the recommended daily fluid

intake volume from food and beverages40.

The best way to prevent dehydration is to drink adequate water daily. Consumers can

track their daily water intake through a paper journal. New solutions can detect

dehydration and remind consumers to drink water, such as the W+Plus system, acumen

Hydrotrack dehydration monitor, and Oregon Scientific’s heart rate monitor with

dehydration alert. Several smartphone apps help consumers remember to drink enough

water by providing reminder alerts and a log to record the amount of water consumed

daily. Examples include Waterlogged, iHydrate, and Carbodroid. Waterlogged allows

users to input their water consumption using pictures of the glasses of water they are

about to drink.

Boosting Daytime Energy Aging affects older adults’ energy levels. A marked drop in an individual’s daytime

energy level may indicate the onset of illness. Even if not caused by specific health

conditions, low energy will reduce older adults’ levels of activity and engagement with

others.

A Columbia University study of adults ages 65 and older found that 22% of women and

12% of men had a lack of energy (anergia).41

Methods of boosting daytime energy include eating a healthy diet, engaging in exercise,

napping, and reducing stress. Caffeinated drinks, such as tea and coffee, and energy

drinks such as 5‐hour Energy and 6‐Hour Power can serve as short‐term solutions to

boost energy levels. Few solutions exist dedicated to boosting energy; instead, solutions

that could effectively increase older adults’ energy levels address the underlying

problems causing low energy, such as poor sleep and diet, depression or lack of exercise.

39 Janet Mentes, “Oral hydration in older adults”, American Journal of Nursing, Vol. 106, No.6, pp. 40‐49. 40 http://www.h4hinitiative.com/wp‐content/uploads/Monograph‐Danone_The‐elderly_2304_final.pdf 41 Cheng, Gurland and Maurer, “Self‐Reported Lack of Energy (Anergia) Among Elders in a Multiethnic Community”, Journal of Gerontology, Vol. 63, No. 7 (2008); pp. 707‐714.

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Reducing Stress

Chronic stress can result in severe health consequences. Stress can worsen hypertension

and high cholesterol levels, can increase the risk of heart disease, can complicate

recovery from illness and can result in depression.

According to the latest Stress in America42 report conducted by the American

Psychological Association, Boomers (Ages 47‐65) and Mature adults (66 years and older)

report less stress than younger generations, but still experience stress levels higher than

recommended. Money, work and housing costs are top stressors for Boomers, while

health problems and family issues are top sources of stress for Mature adults. 63% of

Mature adults are somewhat or very significantly stress by health problems affecting

their families and 56% are stressed by personal health concerns.

According to the Stress in America survey, 44% of Boomers report laying awake at night

due to stress while 40% overate or ate unhealthy foods due to stress. 42% of Boomers

and 23% of Mature adults experience irritability or anger as a result of stress. Two‐thirds

of Mature adults say managing stress is important but only 46% say they are “very good”

to “excellent” at doing so.

Consumers can manage their stress levels through breathing exercises, exercise and

meditation.

Top stress management mobile applications help users understand and respond to stress.

Stress Tracker allows users to rate and track their stress levels, sources of stress, moods,

feelings and symptoms, and provides action steps users can take to lower their stress

levels. The Cleveland Clinic Stress Management app features meditation exercises read

aloud by a narrator. The Relax Stress & Anxiety Relief app guides users through breathing

exercises with calming music.

New solutions are integrating sensor technology into their stress management systems.

SweetWater Health’s SweetBeat system integrates a heart rate monitor with its mobile

app to identify users’ stress levels through heart rate variability; the system doubles as a

weight loss tool. Samsung’s MyFit MP3 player comes equipped with built‐in stress

sensors. Affectiva’s wearable wireless Q Sensor constantly checks for signs of stress or

anxiety through changes in the user’s skin conductance. The resulting data can help

consumers identify their greatest sources of stress.

42 American Psychological Association, Stress in America: Our Health at Risk, January 11, 2012.

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2.4 Managing Health Risks and Conditions

Reducing Bad Cholesterol High cholesterol is a risk factor of heart diseases such as coronary artery disease (CAD),

heart attack, stroke, and congestive heart failure. For people 50 and older, lowering

overall cholesterol levels, especially the low density lipoprotein (LDL, a.k.a. bad

cholesterol), prevents plague build‐up, thus improving overall heart health.

The CDC reports that 49% of men and 53% of women ages 65‐74 have high cholesterol,

as do 45% of men and 53% of women 75 and older.43 The CDC estimates that 71 million

American adults have high LDL, and only one in three have it under control. People ages

50 and older have a much higher incidence of LDL than younger age groups.

Although consumers typically receive blood test results from their doctor, self‐test kits

from brands such as CholesTrak, Home Access Instant Cholesterol Test, or First Check

Home Cholesterol Test are also available for people to check cholesterol at home. These

kits, however, have various limitations: only total cholesterol level is shown with no

breakout of LDL, HDL and Triglyceride readings. Two advanced test kits (from Cardio

Check and Lifestream Personal Cholesterol Monitor) can test total cholesterol, HDL, and

Triglyceride, but they require three separate blood drops, don’t measure LDL, and are

more expensive (more than $100). As a result, less than 2% of consumers have used the

solution at home.44 If an individual already has abnormally high cholesterol, cholesterol‐

lowering medications or plague‐removal surgery (known as endarterectomy) might be

needed.

Cholesterol control requires a comprehensive approach involving dietary changes, weight

control, regular exercise, and stress reduction. Health portals such as WebMD offer

cholesterol health checks, while MindBloom and Thecarrot.com offer comprehensive

solutions that can help consumers address their dietary, fitness, and mental health needs.

43 CDC, “Table 71. Cholesterol among persons 20 years of age and over, by selected characteristics: United States, selected years 1988‐1994 through 2007‐2010,” Health, United States, 2011, With Special Feature on Socioeconomic Status and Health, 2012. 44 Parks Associates, Personal Care Tools and Application, 2010.

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Keeping Glucose in Range

Blood sugar levels fluctuate daily, but too much or too little glucose in the blood can have

serious consequences. The need to keep glucose level in a controlled range is paramount

for people with Type I or Type II diabetes and very essential for those with pre‐diabetes.

According to the CDC, diabetes affects 25.8 million people in the U.S. 27% of people 65

and older have diabetes, which is more than twice the average of people 20 years and

older.45 More worrisome is the rising number of people suffering pre‐diabetes symptoms

who share the same risk factors as a diabetic. The CDC estimates that 35% of people 20+

are pre‐diabetic. Among people 65+, pre‐diabetes incidence is 50%, or about 50 million

people.

Keeping blood sugar levels in the right range requires a careful diet, exercise and

sometimes medication and insulin injections. Diabetics must monitor their glucose levels

several times a day with the help of a glucose monitor from brands such as Bayer,

OneTouch, FreeStyle, TrueResult and Accu‐Chek.

New glucometers, such as Sanofi’s iBGStar glucometer, make better use of consumers’

health data. By syncing users’ glucose readings with a diabetes management app, these

new devices help users track their glucose levels and share collected data with physicians.

Maintaining a Healthy Weight

Being over or under the recommended weight guidelines is a direct contributor to many

lifestyle‐related illnesses such as high cholesterol, diabetes, and heart problems. Weight

problems can also cause older adults to become inactive, which can worsen many health

problems and lead to social isolation.

In 2010, 43% of men and 45% of women ages 65‐74 were obese; 27% of men and 30% of

women age 75 and older were obese.46

Educational information from health care providers can help consumers understand the

recommended weight range for their age, gender and height. Solutions on market

helping consumers to maintain a healthy weight tend to fall in “diet & nutrition” or

“physical fitness”. Consumers tend to track their weight using a basic scale, though new

45 CDC, “Diagnosed and Undiagnosed Diabetes in the United States, All Ages, 2010,” 2011 National Diabetes Fact Sheet, http://www.cdc.gov/diabetes/pubs/estimates11.htm. 46 Federal Interagency Forum on Aging‐Related Statistics, Older Americans 2012: Key Indicators of Well‐Being, Washington, D.C.: U.S. Government Printing Office, June 2012

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WiFi‐enabled scales now enable users to capture that data daily and watch their weight

levels rise and fall over time.

Keeping Blood Pressure in Range

Abnormal blood pressure—whether too high or too low—is a leading cause of heart

disease and stroke. The need to manage blood pressure is particularly urgent for people

ages 50 and above due to the loss of elasticity in the arteries that results as a byproduct

of aging, and can result in high blood pressure.

According to CDC’s National Health and Nutrition Examination Survey, 64% of men and

69% of women ages 55‐64 years old suffer from high blood pressure (hypertension), as

do 72% of men and 81% of women 75 and older.47

Medication is the most common solution to controlling blood pressure. Care providers

also offer telephone consultation hypertension management services centering on

patient education on the early signs of adverse events and lifestyle risk factors, such as

being overweight, excessive sodium intake, and poor sleep quality.

According to Parks Associates’ data, 60% of consumers in broadband households who

have abnormal blood pressure own a meter to monitor their blood pressure at home.48

Most of these devices simply display readings on the device’s screen with no option to

track and review the collected data.

New blood pressure monitor designs leverage smartphones to offer enhanced functions.

Connected blood pressure cuffs from companies like iHealth and Withings, which sync

with mobile applications, can help users track their blood pressure automatically and

share data with their physicians. These apps can also integrate educational materials

from with trusted third‐parties to help users manage related hypertension risk factors

such as weight, sodium intake and sleep quality. Adoption of these new solutions,

however, is low due to low awareness among the targeted population and increase cost;

the price of a connected blood pressure cuff is 40‐50% higher than an old‐fashioned

monitor. In addition, these new device makers have found it difficult to enter the

traditional retail channels such as drug stores and supermarkets.

47 CDC, “Table 70. Hypertension among persons 20 years of age and over, by selected characteristics: United States, selected years 1988‐1994 through 2007‐2010,” Health, United States, 2011, With Special Feature on Socioeconomic Status and Health, 2012. 48 Parks Associates, Managing Care through ACOs: Consumer Interests & Requirements, 2012.

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Relieve Back Pain

Back pain can be caused by a variety of factors such as arthritis, previous injury, and

certain illnesses or infections. People ages 50 and older suffer back pain

disproportionately because of age‐related illnesses, occupational hazards, and

accumulated impact from bad posture.

According to the U.S. Census Bureau, 33% of people ages 45‐64, 30% of those ages 65‐74,

and 34% of those ages 75 and older suffer from lower back pain.49

Medications and chiropractic services can temporarily relieve back pain symptoms, but

surgery is sometimes required for a longer‐term fix. To prevent back pain, however,

solutions help older adults modify their sitting and standing posture and follow muscle

toning exercises. Back pain apps such as iREHAB Back Pain, exercise apps such as Yoga for

Back Pain Relief, and digital programs such as FPR (Feeling Pretty Remarkable) all address

back pain in older adults.

Detecting Skin Problems

Skin cancer accounts for more than half of all cancers in the U.S. People with pale

complexions, excessive exposure to the sun and exposure to certain occupational

chemicals are more likely to develop skin cancer. Older adults must watch for early signs

of skin problems such as changes in the size, color or shape of an existing mole, or scaly,

itchy, or raised patches on the skin.

According to the American Cancer Society, more than 2 million cases of basal and

squamous cell skin cancer are diagnosed each year, with another 75,000 people

diagnosed with Melanoma, the most dangerous type of skin cancer.50

Regular skin cancer screening is recommended by the medical community, but in many

cases, regular self examination is the first step toward skin problem identification or

prevention. Mobile apps such as SkinVision, SpotCheck, Skin of Mine, or virtual

consultation service from providers such as Direct Dermatology make monitoring one’s

skin for changes more convenient for older adults.

49 U.S. Census Bureau, “Table 199. Persons 18 years of Age and Over with Migraines and Pains in the Neck, Lower Back, Face, or Jaw by Selected Characteristics: 2009,” Statistical Abstract of the United States: 2012. 50 American Cancer Society, “Skin Cancer Facts,” January, 2012. http://www.cancer.org/cancer/cancercauses/sunanduvexposure/skin‐cancer‐facts

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The Need

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Addressing Calcium Deficiencies Due to calcium loss, older adults have weaker bones that are prone to fracture or break if

they endure a sudden strain, bump, or fall. The need to slow the thinning of bones and

prevent osteoporosis is greatest for women approaching menopause, but is broadly

applicable to all age groups above 50.

According to the National Osteoporosis Foundation, about 10 million U.S. consumers

have osteoporosis and about 34 million are at risk for the disease.51 The NOF estimates

about half of all women older than 50, and up to one fourth of men, will break a bone

because of osteoporosis.

Healthy lifestyle choices can help prevent further bone loss and reduce the risk of

fractures. People 50 and older can choose a calcium‐rich diet and engage in age‐

appropriate exercises to maintain bone density and strength. The first step to prevent

osteoporosis is education and risk assessment. Websites and mobile apps offer plenty of

solutions for people to learn how best to prevent osteoporosis. Mobile application

CalciumTrack works like a food diary and estimates the amount of calcium the user

consumes daily.

Maintaining Good Dental Hygiene

Recent research has shown that good dental health is linked to lower risks of chronic

conditions and dementia. Good dental hygiene helps prevent gum disease, slow tooth

decay, and prolong the life of dentures and implants. Stronger teeth, in turn, help older

adults eat, improve speech, and enhance self‐esteem.

According to the National Health and Nutrition Examination Survey in 2004, 17.2% of

people age 65 and over have periodontal disease and 10.6% have moderate or severe

periodontal disease.52 But recent research from the CDC and the American Academy of

Periodontology (AAP) concluded that “the prevalence of periodontal disease may have

been underestimated by as much as 50%.”53

Prevention is key to maintaining good dental health. Recommended preventive dental

care includes frequent brushing, flossing, and rinsing teeth and regular visits to a dentist

for professional dental care. However, people of all ages skip simple tasks like teeth

51 National Osteoporosis Foundation, “Bone Health Basics: Get the Facts,” http://www.nof.org/learn/basics. 52 National Institute of Dental and Craniofacial Research, “Periodontal Disease in Seniors (Age 65 and Over),” http://www.nidcr.nih.gov/DataStatistics/FindDataByTopic/GumDisease/ 53 CDC and the American Academy of Periodontology, “CDC: Half of American Adults have Periodontal Disease,” September, 2012. http://www.perio.org/consumer/cdc‐study.htm

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brushing and dental flossing or perform these tasks improperly. New technology‐

powered dental care products have seen growing adoption over the past ten years.

Electric toothbrushes from brands such as Philips Sonicare or Oral‐B are selling well

(Philips estimates 22 million users of its Sonicare toothbrushes).54 Additionally, new app‐

connected toothbrushes from Beam Technologies and Philips’ Airfloss provide feedback

on users’ brushing habits. Educational mobile apps like Cavity‐Free 3D teach users how to

brush and floss properly, while Brush DJ and Time2Brush remind users when it’s time to

brush and track their brushing time.

Managing Arthritis

Arthritis can cause pain, fatigue, and inflammation such as swelling, stiffness, and

redness. Persistent arthritis pain can affect people both physically and mentally; it can

lead to chronic disability and affect older people’s daily activities, such as walking.

The most common types of arthritis are Osteoarthritis and Rheumatoid Arthritis.

Osteoarthritis affects 27 million people in the U.S., according to CDC estimates, and a

majority of those suffering this condition are 50 years or older. Rheumatoid arthritis

affects an estimated 1.5 million adults.55 Arthritis incidence has been steadily on the rise

over the last 20 years and is still growing.

Although medication can relieve arthritis pain, lifestyle changes – such as getting

adequate sleep, maintaining a healthy weight, and participating in properly designed

exercise programs – helps ease arthritis pain as well. Devices and applications that help

improve sleep quality, reduce excess weight, and keep older people active with exercise

are also beneficial to people living with arthritis.

Technologies and mobile applications that target arthritis specifically fall into the

following four categories. First, apps like ArthritisID and Zimmer Arthritis 411 provide

arthritis information and education. MyPainDiary and Track+React apps enable users to

track their arthritis pain levels. Joy Bauer Food Cures provides a diet plan for people living

with arthritis, and Arthritis Connect helps people connect with others who have the

condition.

54 Philips, Annual Report 2011, http://www.annualreport2011.philips.com/content_ar‐2011/en/proofpoints/global_oral_healthcare_brand.aspx. 55 CDC, “Arthritis‐Related Statistics,” http://www.cdc.gov/arthritis/data_statistics/arthritis_related_stats.htm.

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2.5 Improving Quality of Life

Staying Connected Socially Older adults appreciate the sense of being able to stay connected with the outside world

and maintain or even expand their social circle after retirement. Social isolation is

particularly relevant to people of older age as decreased mobility and other aging

symptoms significantly limit their ability to meet, communicate, and enjoy

companionship with friends, neighbors, and family members. Reallocation to a new

neighborhood or a new housing type may aggravate a sense of isolation. For some, it can

be an episodic concern as they soon adjust themselves to the new environment. For

many older people, however, the feeling of being shut out of their former social circle or

a sense of a dwindling number of friends can reduce their quality of life.

The Australian Center of Aging Studies reported that “longevity increased by 22% among

people 70 and older with a large circle of friends compared to those with the fewest.”56

A 2008 study from the University of Chicago concluded that “chronic loneliness is a

health risk factor comparable to smoking, obesity and lack of exercise, and contributes to

a suppressed immune system, high blood pressure and increased levels of the stress

hormone cortisol.”57

A tracking survey of 1,064 participants 60 and older, conducted by the University of

California at San Francisco from 2002 to 2008, found that 30% of respondents reported

feeling lonely sometimes and 13% felt lonely very often.58 Extrapolating the data, Parks

Associates estimates that social isolation affects at least 4 million people 65 and above in

a severe way.

Current solutions to older people’s social solitude focus on two aspects: community

gatherings and online social networking. People in their late 60s and 70s rely on senior

community centers, casually organized clubs, and volunteer work to stay connected.

Younger adults, however, also use digital media to stay connected with friends and social

contacts. Parks Associates’ data shows that 56% of adults ages 55‐64 and 44% of those 65

56 Giles, Glonek, Luszcz and Andrews, “Effect of social networks on 10 year survival in very old Australians: the Australian longitudinal study of aging,” Journal of Epidemiology and Community Health¸ Vol. 59 (2005): pp.574‐579. 57 John Cacioppo and William Patrick, Loneliness: Human Nature and the Need for Social Connection, W. W. Norton & Company, 2008 58 Judith Graham, “The High Price of Lonliness,” The New York Times, June 18, 2012, http://newoldage.blogs.nytimes.com/2012/06/18/the‐high‐price‐of‐loneliness/

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and older, who live in a household with broadband internet access, use Facebook on a

weekly or daily basis.59

Keeping Mobilized

Older people treasure the ability to drive, such that giving up the car keys can be a sad

life milestone. The sentiment is understandable since the ability to drive expands

people’s life radius, brings a sense of pride and independence, and helps them meet

many practical, daily needs—shopping, running errands, meeting family and friends,

seeing a doctor, etc. But declining vision, slower reaction times, and a weakened muscle

system force many older people to give up driving and rely instead on public

transportation, family and friends – or to simply become home‐bound. A study

conducted in suburban Maryland in 2006 found that ”those who had given up driving

were nearly five times more likely to end up in long‐term care after eight years than

those who were still driving, even when researchers accounted for various health

problems.”60

An AAA survey conducted in December 2011 found that 88% of people 65 years and

older consider the inability to drive a problem and 57% felt it was a serious problem.61

According to the Insurance Institute for Highway Safety (IIHS), there were 22 million

licensed drivers aged 70 and older as of 2008, representing 78 percent of that

demographic group.62 Inversely, 22% of the people 70 and older, or approximately 3.5

million, are unable to drive.

Transportation support is a common benefit provided by assisted living facilities and

retirement communities; shuttle services typically feature a routine route for basic living

needs like grocery shopping, haircuts, doctor visits, etc. However, these services usually

do not run on nights or weekends, and often require advanced notice. Most elderly who

give up driving and live at home rely on their adult children for a ride or take public

transportation service, where available. Some companies, like SilverRide, as well as non‐

profit organizations, like the Independent Transportation Network of America, are

attempting to fill the transportation gap by providing low‐cost private transportation

services for older adults.

59 Parks Associates, March 2012 Survey, 2012 (see Appendix for associated chart). 60 Kay Lazar, “Off the road,” The Boston Globe, December 21, 2009: http://www.boston.com/news/health/articles/2009/12/21/the_emotional_and_physical_costs_of_giving_up_driving/ 61 AAA, Senior Driver Survey Report, December, 2011. 62 Insurance Institute for Highway, “Q&A: Older Drivers,” September 2012: http://www.iihs.org/research/qanda/older_people.aspx

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For those who are still behind the wheel but are concerned about driving, multiple

technologies are in place to make driving safer and more convenient—lane departure

warning systems, forward collision warnings, and electronic stability control are a few. In

the long term, self‐driving cars (Google) provide hope that one day the older adults who

are no longer able to drive will be able to sit in the car as a passenger and let the car take

them to their destination.

Navigating the Healthcare System

The U.S. healthcare system is complex and confusing to the older adults. The multi‐payer

system, coupled with complex benefit designs, has given rise to confusing coverage terms.

Frustration arises when access to needed care is subject to restrictions based on network

eligibility, pre‐existing conditions, co‐payment requirements, and maximum benefit caps.

For older adults, assistance navigating the U.S. health systems is most needed in the

following two areas:

1. Coverage decisions: Older adults need assistance understanding appropriate

coverage and associated costs, filling out paperwork correctly, following rules for

using health services, and learning what to do in the case of a

coverage/reimbursement dispute.

2. Healthcare service decisions: older adults need assistance choosing the best

available doctors, learning about a growing list of treatment options, making

treatment decisions after physician consultations, and managing health and chronic

conditions under care provider supervision.

A 2011 Deloitte survey showed that 76% of healthcare consumers do not have a strong

understanding of how the health care system works.63 A 2008 Common Wealth Fund

survey found that “8 of 10 respondents agreed that the health system needs either

fundamental change or complete rebuilding,” and it concluded that “adults' health care

experiences underscore the need to organize care systems to ensure timely access,

better coordination, and better flow of information among doctors and patients.” 64

Health concierge services aim to alleviate consumer frustration by devoting dedicated

personnel to guide consumers through the various healthcare decisions needed for each

care episode.

63 Deloitte Center for Health Solutions, 2011 Survey of Health Care Consumers in the United States: Key Findings, Strategic Implications, 2011. 64 Sabrina K. H. How, Anthony Shih, Jennifer Lau, and Cathy Schchoen, Public Views on U.S. Health System Organization: A Call for New Directions, 2008. http://www.commonwealthfund.org

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Companies offering health concierge services include Health Champion, MDVIP,

EliteHealth.com, and SignatureMD, among others. The current user base of these

services is small. A 2009 survey conducted by a congressional agency indicated that there

were only 750 doctors practicing concierge care in 2009, although this is a big jump from

the mere 150 concierge doctors counted in 200565. Using an estimate of 500 patients per

concierge doctor, the user base for this service is only estimated in the 500,000‐700,000

range in 2012.

One big inhibiting factor is price. Most high‐end concierge services charge an annual

membership fee starting from $1,500, making them less affordable to ordinary families.

A few providers are trying to move the service price downward. For instance,

EliteHealth’s basic membership can be as low as $14.95 per month but the services

included in this basic membership are so limited that the lower tier becomes less

appealing to consumers who have a primary care doctor.

Availability of the service is also a concern. Users may desire an option to meet their

concierge doctor face‐to‐face. With a small number of concierge care doctors located in

more affluent locations, such as New York and Florida, the service concept becomes less

appealing to those with no face‐to‐face access to a concierge doctor. Online virtual care

is on the rise as part of concierge services, allaying some of these concerns.

A lighter version of such services offers consumers symptom checking capability, links to

local doctor’s office, and ancillary features such as doctor ratings, online appointment

scheduling capability, and online paperwork preparation prior to a face‐to‐face

appointments. Examples include ZocDoc and, Aetna’s iTriage. ZocDoc has 2.5 million

monthly users and is available in 34 major metropolitan markets. The iTriage app was

downloaded more than 7 million times by users before it was acquired by Aetna in

December 2011.

Managing Healthcare Costs

Healthcare cost burdens on people 50 and older have increased significantly over the last

ten years. Premium increases, rising co‐pays, and a multi‐tiered healthcare benefit

system that shifts many costs to end users have all contributed to rising spending on

medical services for the older population. Additionally, older adults are more prone to

costly chronic conditions. The need to understand the cost implications of healthcare

decisions and to find the most cost effective treatment options is very acute for the 50+

age group.

65 http://vitaadvisors.com/2010/11/29/medpac‐on‐retainer‐medicine/

The Need




According to Aetna’s Empowered Health Index survey in July 2012, 88% of consumers

said that health insurance choices are tough because information is confusing and

complicated. 43% of adults do not track their out‐of‐pocket health costs and 81% have

difficulty in making healthcare decisions because they do not know the costs of tests and

procedures.66

The solutions to this need fall into two categories—services offering cost comparison

information before patients make service decisions and services assisting patients with

medical bill disputes. Companies offering cost comparison services include CastLight,

GoHealth, UnitedHealth’s MyHealthcare Cost Estimator, LowestMeD.com,

ClearHealthCosts.com, FaircareMD, SnapHealth, Anthem Care Comparison, and GoodRX

app. These services, however, face typical start‐up challenges: low consumer awareness,

incomplete cost data, and limited coverage of healthcare facilities and procedures. For

instance, GoodRX and LowestMed.com only offer drug costs while UnitedHealth and

Anthem’s tools only address costs for their subscribers. GoHealth compares only

insurance costs, whereas Castlight is focused on B2B services for employers and insurers,

limiting its ability to build scale quickly.

Evaluating Care Quality

Although care quality varies by provider type and care service categories, the U.S.

healthcare system is far from being transparent. This makes it difficult for patients to

select care providers, set the right expectation for an upcoming care experience, and

provide timely feedback to care providers.

The need to understand care quality of different provider and facility types is growing as

more healthcare dollars are spent by consumers. Anecdotal evidence shows that

consumers are increasingly interested in providing feedback about their care service

experience through digital tools and social media, and they also draw their own

conclusions based on reviews and comments by online peers.

Solutions to help patients understand differences in the quality of care across healthcare

facilities, provider types, and procedures include online sites to rate and evaluate doctors,

and hospital services. Leaders of such solutions include HealthGrades, RateMDs.com,

Vitals.com, Carechex, and Angie’s List. HealthGrades is the largest provider of this kind of

service, boasting more than 200 million visitors. While consumers are generally trusting

about ratings from peer groups, the personal nature of care experience and varied care

66 Aetna, “Decision 2012: Health Care Benefits Second Most Difficult Decision for Consumers,” September 17, 2012. http://newshub.aetna.com/press‐release/decision‐2012‐health‐care‐benefits‐second‐most‐difficult‐decision‐consumers

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quality perceptions keep users wondering whether consumer reviews alone offer

complete information.

Government portals also provide clinical performance data in a report card format but

report card data requires a high‐level of clinical literacy to understand and thus are less

useful to ordinary consumers.

Receiving Divorce/Grief Support The loss of a loved one and the end of a marriage are painful life experiences. These life‐

changing events bring individuals grief and stress and leave survivors with many practical

considerations to resolve. The mental burden can have a dramatic impact on older adults,

affecting their quality of life and personal health. The loss of a loved one can also lead to

a smaller social circle and less frequent social engagement.

The U.S. divorce rate is highest among people 45‐54 (16.6% or men and 20% of women),

according to the 2011 American Community Survey. Divorce rates for people 65 and

older hovers around the national average of 11%.67 By 75, the rate of becoming widowed

reaches 50% for women and 17% for men. By the age of 85 or older, the widow rate hits

73% for women and 35% for men.68

Following the death of a spouse or other loved one, consumers can attend bereavement

support groups at local community centers or places of worship and can call crisis

hotlines in an emergency. Professional counseling services can provide more long‐term

support for any number of issues.

Online support groups also provide social support for people struggling with health

conditions or undergoing dramatic life changes. Websites that provide divorce and grief

support services include Sincemydivorce.com, Daily Strength, GriefShare, HelloGrief.org,

GriefJourney.com. These portals are organized by topic, and information is presented in

either message board/forum format from users or in a curated format. The average

number of daily unique visitors for these portals is in the 10,000‐30,000 range, indicating

monthly unique visitors below the 1‐million mark, an unappealing metric to large brand

advertisers. In addition, designs of these portals are usually more educational than

interactive, and information is cluttered with ads, which further reduces the user

friendliness of these Websites.

67 U.S. Census Bureau, “Marital Status,” American Community Survey, 2011. 68 U.S. Census Bureau, Current Population Survey, Annual Social and Economic Supplement, 2010.

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Managing Life Phase Transitions There are many types of life events that affect people physically and mentally. For older

adults, these transitions can be physical changes to the body (e.g., menopause), lifestyle

changes (e.g., retirement), or health related (e.g., diagnosis of a major life‐threatening

disease). These events can cause stress and lead to behavioral changes further worsening

the affected person’s physical and mental health.

According to the Pew Research Center, beginning in 2011 – the first year when the oldest

baby boomers hit the retirement age – 10,000 people will hit the retirement age of 65

each day for the next 19 years.69 All women will encounter menopause at some point in

the aging process; the average age of a women’s last menstrual cycle is 51, but the

menopausal transition, or perimenopause can last a full year.70 Additionally, new

diagnosis of chronic conditions and terminal illnesses are in the millions each year.

Self‐education and peer support are the two most important aspects of a support

program helping older people make life phase transitions successfully. Online

educational tools through providers like WebMD, A.D.A.M., MedHelp and online patient

support services such as PatientslikeMe, InspireHealth, CureTogether are designed to

relieve end users’ anxiety, receive peer support, and find comfort and means of

treatment to improve health and wellness during these life stage transitions. These Web

portals generate millions of visits each month but members of specific support groups—

those active users—are still a small portion of the total Web traffic. PatientslikeMe has

an estimated 700,000 members and InspireHealth has about 250,000; both programs

having been running for several years. These programs tend to attract sicker patients or

patients with a unique illness that is not in the mainstream public health domain. For

others, online support group use is light given that the content on these portals is more

health‐related than associated with life transitions.

Online consultation services such as CopeToday and HealthLinkNow provide additional

support for people experiencing life phase changes, but these and others are still in the

start‐up phase.

69 Pew Research Center, “Baby Boomers Retire,” December 29, 2010. http://www.pewresearch.org/daily‐number/baby‐boomers‐retire/. 70 NIH National Institute on Aging, “AgePage: Menopause,” April, 2012. http://www.nia.nih.gov/health/publication/menopause

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Planning for End of Life Care

Planning end of life care is a difficult issue, whether for oneself or for a loved one. People

living with or dying of advanced illness seek physical, mental, and emotional support on a

range of topics : having an open conversation with doctors about end‐of‐life care choices,

advancing directives on care wishes, designating decision‐makers when they are unable

to make their own decisions, evaluating the proper time to start hospice care, and

addressing legal matters after death.

Younger adults, who are more likely to be caregivers, endure physical and emotional

fatigue, stress, depression, and anxiety associated with taking care of an older and very

sick family member. They need education and support on how best to cope with the

physical and mental burden of meeting a family member’s end of life care needs.

MedPac data indicated that more than 500,000 patients used hospice care in 2000. By

2009, Medicare hospice beneficiaries jumped to more than 1.1 million in total number. In

2010, about 44% of Medicare beneficiaries who died that year used hospice care, up

from just under 23% in 2000.71

Online resources such as Compassionandsupport.org, GrowthHouse.org, and WebMD

provide educational information about end of life planning. Most hospitals offer hospice

care as a listed service and home care agencies also offer hospice care in specific

locations or in home. Other than those informational portals and on‐the‐ground services,

there are few entrepreneur activities in this care arena.

71 MedPac, Report to the Congress: Medicare Payment Policy, March, 212. http://www.medpac.gov/chapters/Mar12_Ch11.pdf

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2.6 Evaluating Needs-Based Challenges

From the evaluation of the more than 30 needs identified in Sections 2.1 through 2.5, certain commonalities

across needs categories emerged. These commonalities represent nine broad healthy living challenges for the

50+ community. Products and services that attempt to solve or remedy one of these nine broad healthy living

challenges also will address, at least in part, multiple more specific needs of older adults. These market

challenges are summarized below, along with the types of specific needs a solution in that space could address.

Examples of solutions currently on market that address the needs within a challenge area are provided.

Figure 2: Thirty‐Two Needs Captured in Nine Healthy Living Challenge Areas




Healthy Living Challenge

Needs Addressed Current Technology/Solutions

Physical Fitness Improve muscle strength Engage in age‐appropriate exercise Maintain healthy weight Boost daytime energy Reduce Stress Keep mobilized Reduce bad cholesterol Keep blood pressure in range Relieve back pain

Connected fitness tracking devices: Fitbit, Nike Fuelband, Jawbone Up, Basis, Nintendo Wii.

Senior fitness classes and weight loss programs: SilverSneaker, SparkPeople

Smartphone apps/online portal to track exercise progress: Endomondo, DailyBurn, Runkeeper, Nike+

Diet and Nutrition Eat healthy/portion control Maintain healthy weight Control sodium intake Prevent dehydration Boost daytime energy Reduce bad cholesterol Keep blood pressure in range Keep glucose in range Slow bone loss Maintain dental hygiene

Online/mobile diet/nutrition education tools: WebMD,

Diet plans: WeightWatchers, Nutrisystem

Diet/nutrition tracking app/diary: Meal Snap, The Eatery, SparkPeople

Reminder apps: Waterlogged, Carbodroid

Behavioral & Emotional

Health

Reduce stress Improve sleep quality Receive divorce/grief support Manage life phase transitions Plan for end of life care

Online support Group: Daily Strength, SincemyDivorce.com, InspireHealth

Online mental health counseling services: Cope Today, HealthLinkNow

Sensors tracking underlying causes: Zeo, Fitbit Aria

Apps tracking stress level: Relax Stress & Anxiety Relief app

Aging with Vitality Aid memory/cognition Improve or aid vision Improve or aid hearing Manage arthritis Boost daytime energy Prevent osteoporosis Maintain muscle strength

Brain/memory games: Lumosity, Dakim, Posit Science

Digital vision/hearing aid apps: magnifier app, voice recognition

Memory aids/digital reminders: Time2Brush




Healthy Living Challenge

Needs Addressed Current Technology/Solutions

Vital Sign Monitoring Reduce bad cholesterol

Keep blood pressure in range

Keep glucose in range

Detect skin problems

Improve sleep quality

Maintain dental hygiene

Medical sensors: Glucometer, BPM, connected insulin pump

Education apps: Diabetes Buddy

Self examining tools: Beam Brush app, SkinVision, Sleep Cycle, W+Plus

Teleconsultation services: Direct Dermatology, Alere

Social Engagement Stay connected socially

Keep mobilized

Stimulate intellect

Reduce stress

Social networks and online support groups: Facebook, PatientslikeMe

Transportation support services/ safe driving aid: SilverRide, ITN America

Medication

management

Manage multiple medications Prevent in‐home accidents Sharpen (aid) memory

Medication reminder gadget or service: Glowcap, GreatCall, Independa

Automatic medication dispenser: InRange, Senticare

Emergency Detection

and Response

Detect falls Send alerts when lost Prevent in‐home accidents

Fall detection sensor: Philips AutoAlert, Halo Monitoring, Wellcore

Home activity/ hazard monitoring sensor: WellAware, Grandcare, AFrameDigital, Tunstall

PERS service: Philips Lifeline, AMAC

PERS devices: LogicMark, Visonic

GSP tracking device/service: Healthsense, LoJack

Navigating the

Healthcare System

Manage multiple medications Manage healthcare costs Evaluate quality of care Navigate health system Plan for end of life care

Health Concierge Services: Health Champion, Concierge Health Services

Cost comparison app or service: Castlight, GoHealth, GoodRX

Care quality rating services: HealthGrades, Vitals.com, Carechex

Online support group and resource portal: WebMD, GrowthHouse.org, Compassionandsupport.org

Figure 3: Leading Needs‐Based Healthy Living Opportunities in the 50+ Market




3.0 Evaluation of Leading Market Opportunities

3.1 Framework for Evaluating Opportunities

To determine the leading opportunities in the 50+ healthy living market, Parks Associates took a two step

approach: first, we evaluated the ability of current solutions to meet market needs, and second, we evaluated

the growth and revenue potential of new or improved solutions in each of the nine challenge areas.

Existing solutions addressing the nine healthy living challenges – such as those listed in the third column of

Figure 3 above – were assessed according to the solution’s ability to meet the needs of the market, the maturity

of the technology used, and the solution’s consumer appeal. The results indicate whether current solutions in a

challenge area are meeting the needs of the market, and if not, whether there is room for new solutions to

differentiate from current ones. The following matrix provides greater detail of this evaluation strategy.

Figure 4: Current Solutions Evaluation Matrix

Evaluation Criteria Rating 1 Rating 3 Rating 5

Access Convenience Offline only Offline + Online Offline + Online + Mobile

Educational MaterialBasic and general

Condition‐specific, credible

sources

Condition‐specific, credible

sources, personalized

Functional Richness Analog functionality

Digital functionality

(Processes, stores, analyzes

data)

Sensor functionality

(Collects data without manual

consumer input)

Motivation/Incentives

Self‐motivation

Incorporate 1 motivator:

‐ Social engagement

‐ Gamification

‐ Physician Rx

‐ Financial Incentive

‐ Other

Incorporate >1 motivator:

‐ Social engagement

‐ Gamification

‐ Physician Rx

‐ Financial Incentive

‐ Other

Action facilitation

Does not provide tools for

action

Partners with solutions for

actionProvides tools for action

Notification, Feedback &

Consultation None

Provides alerts & feedback for

self‐use

Provides data and alerts to

caregivers or care providers for

intervention/consultation

Technology Maturity

Unstable technology, high cost

curve, interoperability issues

Developing technology, costs

declining

Mature technology, scale

efficiencies, high usability

Design/Aesthetics

Poor aesthetic or design

creates barrier to adoption

Aesthic/design neutral. Not a

barrier, not a driver

Superior aesthetic/design

drives solution adoption

Consumer Awareness

Low: needs marketing or new

positioning

Medium: Specific consumer

segments aware of product

High: most 50+ consumers

aware of solution

Affordability

Priced out of most consumers'

budgets

Cost justifiable to those who

need solution

Low out‐of‐pocket costs (may

include 3rd party payor)

Current Solution Evaluation Matrix

Solution Utility

Technology Maturity

Consumer Appeal

Total Possible Scoring range = 10 to 50




In addition to the ability to differentiate from current solutions on market, each challenge area was also scored

according to its growth potential, revenue potential, and barriers to entry/risk factors. Figure 5 illustrates the

scoring matrix for the market opportunity posed by each challenge area.

Figure 5: Market Opportunity Assessment

Rating 1 Rating 2 Rating 3 Rating 4

Ability to

Differentiate

Ability of existing solutions

to meet market needs

(sub‐rating score)

Market needs

met:

40 to 50

Market needs

largely

addressed:

30 to 39

Market needs

underaddressed:

20 to 29

Substantially

underserved

market needs:

10 to 19 35%

Growth potential

Addressable market

(size of 50+ market,

applicability beyond 50+),

growth potential

Small

market/low

growth

Small

market/high

growth

Large

market/low

growth

Large

market/high

growth 20%

Revenue potential

Business model maturity

and revenue potential

Low revenue

potential/

stable

business model

Medium revenue

potential/less

defined business

model

High revenue

potential/less

defined business

model

High revenue

potential/likely

sustainable

business model 25%

Barriers to entry/

Risk factors

Regulatory/policy risks,

partnership opportunities,

patent/legal issues,

presence of dominant

market forces

High with

barriers

unlikely to

change long

term

Moderately high

with barriers

likely to change

short‐term

Medium with

predictable

risks/barriers

Low with

predictable

risks/barriers 20%

Market

Opportunity Evaluation Summary

Rating BreakdownWeight




3.2 Comparative Assessment

All nine challenge areas present solid opportunities for investors and entrepreneurs. Due to particularly

favorable market conditions, three challenge areas scored 75 or higher, on an index of 100, representing the

best of these nine opportunities for new investment.

Medication management (84/100): a large addressable market is underserved by current medication

management solutions. There are distinct ways new technologies could help the acute issue of

medication non‐compliance, profitably.

Vital Sign Monitoring (79/100): most vital sign monitoring devices on market fall short of making

collected data meaningful to users. Strong growth in the connected vital sign monitoring market is

expected, thanks in part to health reform incentives.

Aging with Vitality (75/100): there is proven demand from a large market of aging adults for solutions

to help them see, hear and move better. Current solutions are single‐purpose devices or services with

outdated designs, which opens clear avenues for new solutions to differentiate.

Figure 6 reveals the full results of the opportunity evaluations. The table illustrates the opportunity areas’

relative attractiveness before projections of total revenues, revenue variance and adopters are considered. After

constructing market forecasts, Parks Associates’ final ranking of the nine opportunity areas was adjusted slightly,

as illustrated in Figure 12.

The following sections provide detailed information supporting our evaluation of the market opportunities

presented by each challenge area. Ratings highlighted in green indicate the highest score(s) received for that

metric, while red indicates the lowest score(s) received for that metric.

Figure 6: Opportunity Evaluation Results

Opportunity rating

Rating + Weight = Category Sub‐Score Rating WeightSub‐

ScoreRating Weight

Sub‐

ScoreRating Weight

Sub‐

ScoreRating Weight

Sub‐

Score

Medication Management 4 35% 1.4 3 20% 0.6 3 25% 0.75 3 20% 0.6 3.35 84

Vital Sign Monitoring 3 35% 1.05 2.5 20% 0.5 4 25% 1 3 20% 0.6 3.15 79

Aging with Vitality 3 35% 1.05 3 20% 0.6 3 25% 0.75 3 20% 0.6 3 75

Navigating Care 3 35% 1.05 2.5 20% 0.5 3 25% 0.75 3 20% 0.6 2.9 73

Emergency Response 3 35% 1.05 3 20% 0.6 3 25% 0.75 2.5 20% 0.5 2.9 73

Social Engagement 3 35% 1.05 2.5 20% 0.5 2 25% 0.5 3.5 20% 0.7 2.75 69

Physical Fitness 2 35% 0.7 3.5 20% 0.7 2.5 25% 0.625 3 20% 0.6 2.625 66

Diet & Nutrition 2 35% 0.7 3 20% 0.6 2 25% 0.5 3 20% 0.6 2.4 60

Behavioral & Emotional Health 2 35% 0.7 3.5 20% 0.7 1.5 25% 0.375 3 20% 0.6 2.375 59

Total

Raw

Score

Opportunity

Attractiveness

Index

Potential for

DifferentiationGrowth Potential Revenue Potential

Barriers to Entry/

Risk Factors




3.3 Opportunities Addressing Medication Management

The market for medication management is huge yet underserved. An estimated 80 million

people ages 50 and older take two or more medications, a number which is projected to

rise to 91 million in 2018. Existing solutions are either too casual, focusing only on the

medication reminder side, or too complex (thus costly) in counting and dispensing pills.

Opportunities exist for new ways to track medication usage without the hassle of

owning a bulky piece of hardware or subscribing to an expensive medication tracking

service.

The medication management market is a dynamic one, with a number of new solutions

hitting the market in the past 3‐5 years. Hardware and software innovations attempt to

improve upon the analog solutions that are widely used by older consumers to manage

their medications today. Solutions like pillboxes are cheap and widely available but rely on

the consumer to understand their medication instructions, identify pills accurately,

remember to take their medications at the right time consistently and provide users and

caregivers with little to no feedback on compliance.

Mobile applications address a number of medication management issues, such as

identifying pills, providing information on common side effects, scheduling medication

reminders, and alerting users of potential drug interactions. Some apps also alert users

when prescriptions need to be refilled and connect users to their pharmacies. These

applications are cheap and user‐friendly, but most require the user to own a smartphone

and rely on consumers to manually enter accurate medication and dosage information.

New pill packaging form factors attempt to collect medication compliance information

automatically for greater convenience and accuracy. Smart pill bottle and smart blister

packaging solutions from companies like Vitality GlowCaps and OtCM are expensive and

will have greater success partnering with disease management companies or gaining

reimbursement from insurers than selling direct‐to‐consumer. Solutions that require a

specialized in‐home device that is programmed remotely, such as InRange’s Emma device

and SentiCare’s PillStation, also must seek alternative avenues of generating revenues and

suffer from poor aesthetics.

The ingestible sensor system developed by Proteus Digital is extremely innovative and

takes much of the responsibility of tracking medication compliance out of consumers’

hands. Even though this system has attained FDA approval, it is still many years out of

mainstream adoption and will potentially suffer from consumer resistance to the idea of

“digestible electronics.”

Challenge Statement

Limitations of Current Solutions




Difficulty identifying pills Confusion over care providers’ instructions regarding dosage, interactions, etc. Limitation on the number of pills physical solutions can accommodate

Bulky design for most automatic medication dispensers

High cost of connected medication management devices without insurance coverage

The medication management market is getting crowded, but is still in its early days. The

need to increase medication compliance is acute and incentives to improve care

accountability will likely increase interest in medication management solutions among

care providers and payers. The market is large and the revenue opportunity is high.

Overall Attractiveness Index: 84 (out of 100)

Assessment Criteria Opportunity Assessment

Ability to differentiate High, as current solutions fall short of addressing

medication compliance in a cost‐effective way, and no

leader has emerged among the connected management

solutions

Growth potential Large unmet need with high growth potential; applicability

beyond 50+ market

Revenue potential Potentially high revenue opportunity with potentially new

business models to drive greater adoption

Barriers to entry/

risk factors

Potential patents governing automatic dispensing methodology or packaging design of pill dispensers

Retail distribution partnerships may be difficult to forge

Medication reminder apps lack a method of automatically detecting compliance

information and most current pill box solutions lack a comprehensive online/mobile

application. Solutions should be integrated so that a user with a basic mobile phone can

receive simple medication reminder messages and smartphone users can access an app

capable of more complex tasks such as idenfitying pills, viewing dosage information,

displaying instructions to refill the pill box, automatically refilling a prescription when it

is depleted and displaying the user’s medication compliance history.

A subscription service enabling care providers or caregivers to intervene if an individual is non‐compliant; applicable to a smaller user group with high compliance requirements.

Digital medication scanner (2D/3D barcode or NFC) that creates a medication log, which

can be shared with the patient’s pharmacist to assess compliance, to send alerts if

intervention is needed, or to enrich loyalty/reward programs

Summary: Major Pain Points

New Product/ Service Concept

Opportunity Assessment

Opportunities to Improve on Existing Solutions




3.4 Opportunities to Enable Aging with Vitality

After the age of 50, a majority of people experience common age‐related conditions,

including memory loss, vision and hearing impairment, and arthritis. An estimated 44

million consumers ages 50 and older could benefit from solutions that address or manage

these symptoms in 2013 alone. Current solutions on the market tend to be single‐

purpose devices or services with outdated designs. The market calls for function‐rich

devices with a better design/aesthetic appeal that use emerging input technologies to

improve ease of use.

Current solutions on market addressing the common symptoms of aging tend to be analog

products. Consumers rely on print calendars and to‐do‐lists to remember important dates

or tasks, turn up the volume on TV sets and cell phones to assist their hearing, use

magnifying glasses or enlarge computer fonts to assist their vision, use canes to assist in

walking and claws to grasp onto hard‐to‐reach objects. These products are readily

available and are typically low cost. Still, new solutions on market incorporate new

features and techniques that may be more effective and more valuable.

Technologies addressing memory loss include memory aids as well as solutions to help

improve memory skills. Online and mobile to‐do‐lists send email alerts and text messages

to remind an older adult to perform a certain task, giving the traditional “to‐do‐list”

concept anywhere/anytime availability. Even more valuable is the ability to contribute to

reminder lists collaboratively. Online and mobile app Astrid, for instance, allows other

household members or caretakers to add or delete tasks from the list. Some reminder

apps, such as the iPhone 5’s Reminder app, also integrate geo‐fencing technology so that

users can set reminders according to their location, in addition to date and time. These

reminder apps require smartphone ownership and their complexity may be a barrier for

some older adults

Solutions designed to improve memory skills are typically designed as games, puzzles or

other cognitive challenges. Brain game services like PositScience and Lumosity are well‐

designed and easily accessible solutions to enhance cognitive skills. Subscriptions fees are

relatively low, but more research and marketing needs to be done to convince users of

the credibility of such services.

The market for solutions assisting hearing has seen new entrants as well. Until recently

the personal sound amplifier market has been characterized by relatively cheap, clunky,

unappealing devices. Worse, the marketing for such devices is so elderly‐focused that an

unnecessary stigma may be attached to this category. New entrants from consumer

electronics manufacturers, such as Able Planet and RCA, should improve the design and

Challenge Statement





image of these devices. Price ranges for personal sound amplifiers vary widely (≈$35 ‐

$899), so some consumers may not be able to afford their desired device.

Developing technologies such as voice recognition, gesture recognition and text‐to‐speech

could serve as the foundation for solutions to assist those with vision impairment and

those struggling with fine motor skills. Using these technologies, developers and

manufacturers have a great opportunity to create solutions for easier device control and

data input than current methods (e.g., pushing small hard‐to‐see buttons on a remote

control, typing a text‐message on a small virtual keyboard). Because common digital

devices are typically designed for and marketed to younger generations, solution

providers can differentiate themselves by incorporating these technologies to make

device interaction as friendly as possible for older adults.

Benefits of most cognitive improvement services/brain games need more scientific

research

Advanced memory aid solutions require smartphone ownership and advanced digital

literacy

Emerging technologies like voice and gesture recognition are still developing

There is proven demand for products and services that help consumers 50 and older

compensate for certain side‐effects of aging. Well designed, aesthetically appealing

solutions that are moderately priced could easily differentiate from current solutions.



Ability to differentiate High: a broad range of needs can be addressed through

improved technology and solutions

Growth potential Large market with relatively large growth potential

Revenue potential High revenue potential with likely sustainable business

models

Barriers to entry/

risk factors

Technology/patent licensing from potential partners

Sales and marketing investment required to raise awareness of new solutions’ benefits over older options

Technology reliability and accuracy

In some instances, clinical benefits need to be obtained through well designed trials






Brain game services should allow users to track their cognitive skills over time to detect

not only if their skills are improving, but also if they are deteriorating. While a decline in

cognitive skill cannot diagnose a clinical problem, it may serve as a red flag or early

warning system for the onset of dementia. An opportunity exists to explore the clinical

uses of longitudinal cognitive skills tracking.

There is a need for solutions that remind older adults “how” to perform a process‐based

task, such as cooking, in addition to simply reminding consumers “when” to perform a

task. A video diary solution that helps users or caregivers record, organize and access

videos in a very simple way could be a great resource for older adults

Invest in companies producing the underlying technologies rather than specific

solutions: High‐Definition (HD) voice, Location‐Based Services (LBS), voice recognition,

gesture recognition, text‐to‐speech functionality.

Augmented reality‐based solutions that show users the effects of aging and how

behavior changes could impact the aging process, with the goal of encouraging healthy

behaviors through fun and informative engagement.






3.5 Opportunities in Vital Sign Monitoring

An estimated 79 million consumers ages 50 and older live with at least one severe chronic

condition. Proper interpretation of vital sign data followed by an actionable plan is critical

to older adults’ ability to self‐manage their conditions and for general healthy living. Most

vital sign monitoring devices on the market fall short of making collected data meaningful

to end users. The high cost of new connected solutions, along with the use of different

networking standards for data transfer, further inhibits market adoption. The market calls

for an interoperable ecosystem of devices that will allow users to monitor multiple vital

signs and receive feedback through one central application.

Basic analog and digital scales are the most common vital sign monitoring devices, but

Parks Associates data also indicates that as many as 2 in 5 consumers ages 50 and older

living in broadband households owns a blood pressure meter and nearly 1 in 5 owns a

glucometer.72 These devices are widely available and some are covered by health

insurance at low or no cost to the consumer. Yet, data is trapped in the device with little

to no feedback and no analysis of progress over time is provided. Few solutions send data

to care providers or caregivers to intervene if vital signs are abnormal.

New solutions in this market are helping consumers make more meaningful use of the

data collected by vital sign monitoring devices. Using a variety of communication

technologies – wired and wireless – scales, blood pressure meters, glucometers, and even

toothbrushes monitor health data, transfer that data to a mobile application and provide

feedback to the user. Some solutions also give users the ability to share that data with

physicians. However, connected vital sign tracking devices are priced higher than

traditional solutions and many require smartphone ownership for data collection and

analysis purposes.

Vital sign tracking solutions that can appeal to a broader market than one particular

disease condition will be more successful. WiThings is perhaps the best example of a

company creating an ecosystem of connected health tracking devices: it offers consumers

a connected scale and blood pressure meter and partners with manufacturers of sleep

monitoring and physical activity monitoring devices. Users can set goals, track their

progress and receive motivational messages from the WiThings app or they can export

their data to one of WiThings’ health and wellness partners. WiThings’ products can be

used by multiple householders, with a dashboard that can handle up to 8 users. Users also

can export health data collected by WiThings into their personal health record with

72 Parks Associates, Managing Care through ACOs: Consumer Interests and Requirements, December 2012.

Challenge Statement





Microsoft Health Vault. Still, connected vital sign tracking devices are quite expensive and

their high‐tech nature may be intimidating to older consumers.

Another approach is to offer consumers the ability to perform self‐examinations as a

prevention technique for certain conditions like skin and breast cancer. Existing mobile

apps and web solutions instruct users on how to conduct a self‐exam, remind them to

perform self‐exams regularly and provide tools to track any changes or concerns. Some

also provide consultation services from dermatologists who review users’ photos of their

skin. These new solutions make monitoring one’s breasts and skin for changes more

convenient for older adults and are moderately priced. However, these services rely on

users’ self‐motivation to consistently engage in these preventative measures. Uptake and

revenue potential may be marginally better for services that respond quickly and credibly

to users’ concerns about suspected problems (e.g. suspicious moles), than for those

providing a largely educational or preventative service.

Finally, teleconsultation services are available that help consumers struggling with

particular conditions, such as diabetes, manage their health and wellness. Services like

Alere work with consumers to help them understand how to best manage their condition

and provide personalized interventions if the subscriber is off track. Teleconsultation

services are not directly or completely reimbursable under Medicare and most state

Medicaid programs. Clinical benefits are not well communicated to target users resulting

in low compliance.

Low awareness of the benefit of self‐monitoring

Lack of feedback on progress for users of standard vital sign monitoring devices

Lack of data integration between various health monitoring solutions

Lack of data integration with care providers for medical intervention if necessary

High cost of devices if uninsured or not reimbursed by insurer

Adding connectivity to standard vital sign tracking devices increases their usability, but

connected health monitoring devices are still costly. Adoption wil grow significantly as the

technology matures; reimbursement of connected trackers should expand as they prove

their ability to improve care outcomes or reduce care costs. Reimbursement for

teleconsultation services will also increase under the ACO model, which provides more

incentives for preventative care.








Ability to differentiate High for a complete chronic care solution: more affordable

solutions with improved ease of use and concrete health

benefits as an incentive are needed

Growth potential Large market with moderate growth potential

Revenue potential High revenue potential with likely sustainable business

models

Barriers to entry/

risk factors

Difficulty getting into retail distribution channel Multiple networking protocols compound interoperability

complexity

Medical liability risk associated with the use of a monitored

service

Investment in service capability can be costly

Competition from existing providers, like Alere

The market needs an ecosystem of moderately‐priced interoperable devices that can

monitor multiple vital signs and report all data back to one application for feedback and

analysis. The solution should offer the ability to share data with a user’s PHR, care

providers and caregivers. The solution should incorporate reminders as well as a rewards

system to encourage users to monitor their health regularly.

Wearable sensors built into commonly used products that are less intrusive to use, such

as a pillow, chair, watch or clothes, to reduce the need to wire up or use specialized tools.






3.6 Opportunities in Care Navigation

The U.S. healthcare system is exceedingly complex and consumers have difficulty

understanding their options regarding care access, quality, and cost. Innovations that aim

to streamline the experience for consumers face systematic resistance to transparency.

Current solutions suffer from a siloed approach to sharing health data with consumers,

and fall short on interpreting data to consumers in a meaningful way. The market needs

well‐organized information and customizable assistance programs to meet healthcare

consumers’ needs. A conservatively estimated 35 million consumers ages 50 and older

would be strongly interested in receiving such a service immediately.

A few solutions on market are designed to ease the many pain points of navigating the U.S.

healthcare system, but all have very low uptake currently. Many of these services require

high Internet literacy as many of the online portals can be confusing for older consumers

to navigate.

Health concierge services guide consumers through some of the decisions needed for a

care episode, such as understanding symptoms they are experiencing, deciding when and

if to see a doctor, and choosing the right doctor to address the condition. Some services

also act as patient advocates for obtaining second opinions and dealing with insurance

coverage issues. Currently, few doctors practice concierge care and most high‐end

concierge services charge an annual membership fee starting from $1,500, making them

less affordable to ordinary families. The market for online concierge services is growing,

but must overcome consumers’ desire to meet their concierge doctor face‐to‐face.

New web portals and mobile applications offer symptom‐checking, links to local doctors’

offices, doctor ratings, online appointment scheduling capability, and online paperwork

preparation prior to a face‐to‐face appointment. These services are growing and major

health insurers, like Aetna and Humana, have been investing and acquiring companies in

this space. Cost comparison services are also hot, but face typical start‐up challenges: low

consumer awareness, incomplete cost data, and limited coverage of healthcare facilities

and procedures. Additionally, current solutions serve only certain parts of the market (e.g.,

a certain insurer’s subscriber base, employer‐based healthcare), and as such their scale is

limited.

New online sites offer consumers the ability to rate and evaluate doctors and healthcare

facilities. While consumers generally trust ratings from peer groups, the personal nature

of care experience and varied care quality perceptions keep users wondering whether

consumer reviews alone offer complete information. Government portals also provide

clinical performance data in a report card format, but the evaluation metrics require a

Challenge Statement





high‐level of clinical literacy to understand, making these solutions less useful to ordinary

consumers.

Finally, online resources such as Compassionandsupport.org, GrowthHouse.org, and

WebMD provide educational information about end of life planning. Most hospitals offer

hospice care as a listed service and home care agencies also offer hospice care in specific

locations or via home visits. Other than those informational portals and on‐the‐ground

services, there are few entrepreneur activities in this care arena.

Paid concierge service remains a novel concept; consumer awareness and willingness to

pay are low

Portal and tool usability needs improvement; health data and care evaluation data

sometimes provided in unclear terms

Insurers and health care providers are not inclined to share cost and quality data, fearing regulation non‐compliance and loss of competitiveness

Revenue/business models are still in an early stage of development

Many solutions solve just one aspect of the care navigation problem, meaning consumers

must reference multiple sources to navigate just one episode of care

Impending health care changes means there will be more transparency throughout the

health care system. With more information available to consumers, care providers and

insurers will need solutions that differentiate their services, reduce churn and control costs.

In these early days, many solutions provide the answer to just one question, but more

comprehensive solutions are needed.



Ability to differentiate Medium High: current solutions lack sufficient data of health

system performance for public use; business models still

evolving for health concierge services, cost comparison

portals, and provider ratings sites

Growth potential Could affect a large market, but growth rate dependent on

uptake of emerging technologies and ability to overcome

significant obstacles

Revenue potential Medium revenue potential with less defined business models






Barriers to entry/

risk factors

Ability to scale nationally limited by lack of quality metrics for comparison sites and qualified providers for concierge services

High marketing costs to raise awareness

Outdated regulations that constrain business expansion or service innovations

Competition from a few early movers in this market

An online portal and service, with accompanying mobile application, that acts as a

comprehensive care navigator through an entire care episode. It would help consumers

evaluate their medical issues, determine if and when to see a doctor, and provide insight

into the cost and quality of services offered by care providers. It should also (natively or

through partnerships) store a consumer’s personal health records, evaluate his or her

insurance benefits coverage, and assist in filing insurance claims. This portal should allow

users to set flexible permissions so caregivers can see some or all of their health activities,

especially regarding end‐of‐life planning.

A digital medical care planner app that offers interactive, step‐by‐step instructions to find

resources for patients’ needs.


Opportunities to Improve Existing Solutions




3.7 Opportunities Enabling Emergency Detection & Response

Over 5 million older consumers fall annually and over 7 million older consumers pose a

wandering risk. Solutions that can detect and initiate a response to emergencies –and in

the future can potentially prevent adverse incidents– will see consistent demand. Current

solutions suffer from an image problem with consumers. Vendors have not moved fast

enough to incorporate the latest mobile technology, and fail to make self‐installation easy

and convenient. Opportunities are abundant to improve current emergency detection

and response solutions for a better user experience and higher adoption rate.

The most prevalent technological approach on market today for responding to falls – the

leading cause of injury among older consumers – is a monitored Personal Emergency

Response System (PERS) with a wearable panic button. The PERS device market has been

relatively static, and faces a number of barriers to growth. First, past marketing efforts

have emphasized the frailty of the user, which has attached a stigma to device use;

consumers rarely view themselves as “sick enough” to justify using the device and many

consumers are wary of being branded as frail. This image issue is compounded by the

unattractive designs of most wearable panic buttons. Traditional PERS devices are also

limited by their ability to work only within the home and only if the user is mobile enough

to press the panic button.

Recently, OEMs have introduced new features, such as emergency response outside of

the home and automatic fall detection, to push beyond some of these limitations. These

benefits are not well known and devices with automatic fall detection are generally more

expensive. Some OEMs, like Lifecomm, are also taking steps to improve design, though

they are currently the minority. Notably, technologies addressing in‐home falls typically

focus on the need to initiate a medical response to the emergency, with few solutions

designed to prevent falls. Solutions that help older consumers improve their strength and

balance could be positioned as fall prevention technologies.

Solutions also exist to address other in‐home emergencies and accidents that may result

from an older consumers’ mobility issues or forgetfulness. Standard smoke and carbon

monoxide detectors are cheap, ubiquitous and serve the basic purpose of alerting

householders of an emergency situation. Some wireless smoke and carbon monoxide

detectors now offer an additional layer of functionality: sending alerts to family members

or emergency responders if a concentration of either is detected. Home monitoring

sensors from companies like Wellaware also alert caregivers of an emergency if those

sensors detect that the person being monitored has exhibited an unusual pattern. Finally,

safety devices are available that can automatically turn off the stove and oven if left on for

too long. These advanced emergency detection sensors and devices are relatively

Challenge Statement





unknown and suffer from very industrial design. Home monitoring sensors and services

are still a niche product and priced out of the range of many older consumers.

Finally, current solutions to assist people who are lost or who wander from home are

available from both the private sector and government programs. Twenty‐nine states

have some form of recovery program targeting missing seniors, often referred to as “Silver

Alerts.” There is movement at the federal level as well to provide similar support and

funding for recovery assistance for older people who are lost. Of course, these programs

should be used as a last resort when wandering prevention techniques have failed or

when caregivers are unaware that the person is missing.

From the private sector, mobile phones enable people who are lost or confused to call

relatives or friends for help – provided the wandering person is aware he or she is lost. For

those caring for an older adults suffering with dementia, wireless door sensors can alert a

caregiver should a person with wandering issues leave the home unexpectedly. Solutions

using the GPS on a cell phone or a wearable device provide even greater functionality:

geo‐fencing technology determines when a person travels beyond a pre‐set zone, alerts

caregivers that he or she needs help, and directs the caregiver to the current location of

the wandering person.

Stigma related to PERS for fear of being labeled as fragile and weak

Aesthetic and design issues inhibit PERS wearability Low awareness of home and hazard‐monitoring sensors

Reliability of sensor technology, potential for problems with false alarms

Cost of whole‐home sensor deployment is still too prohibitive

Alternatives “safety nets” available: family members, mobile phone

The PERS market is a low‐growth mature market, but significant opportunities exist to

attract slightly younger, image‐conscious consumers. The growth projections for dementia

in the near term reveal a solid opportunity to address wandering. Data suggests that

caregivers find emergency detection and response services and devices much more

appealing than potential users, but few existing solution providers prioritize care givers.








Ability to differentiate High: opportunities to improve on function and design. Most

solutions on the market are reactive services; ability for

proactive services to differentiate.

Growth potential Limited size of addressable market with low growth for

current solutions; new innovations may trigger dormant

demand to spur higher growth

Revenue potential Large revenue potential with likely sustainable business

models

Barriers to entry/

risk factors

Competition from existing solution providers

Installation of sensors and monitoring systems can be costly for start‐up companies

Potential liability risks associated with a missed event or slow response

Patents on certain features such as two‐way voice communications may not be licensed or licensed on unfavorable terms

Consumer stigma toward PERS

Emergency prevention technology is still in development

A moderately‐priced, sleek‐looking solution that works outside of the home and can

detect falls automatically: design options should be available to appeal to consumers of

different ages and genders. Marketing to caregivers should be prioritized and online

portals or mobile phone applications must incorporate caregiver notification.

A combined PERS/wandering detection/medication management service that

incorporates caregiving responsibilities: a comprehensive solution that provides

emergency detection and response for a number of use cases and allows

users/caregivers to select one or a bundle of services. This centralizes multiple

caregiving tasks and can provide more functionality at lower cost than would stand‐

alone solutions.

Technologies addressing in‐home falls typically focus on the need to initiate a medical response to the emergency, with few solutions designed to prevent falls. Solutions that help older consumers improve their strength and balance could be positioned as fall prevention technologies. There could be opportunities for partnerships between PERS service providers and fitness equipment manufacturers or gaming console providers to engage older consumers in balance‐improving exercises.






3.8 Opportunities Addressing Physical Fitness

Physical fitness is fundamental to older adults’ ability to live a satisfying and independent

lifestyle, thus representing an attractive business opportunity. Yet, 38 million consumers

ages 50 and older are obese and a third of Americans 65 and older engage in no leisure‐

time physical activity. Most solutions on market today either fall short on interactive and

self‐motivation features, or are designed and priced for younger demographics without

careful consideration of the 50+ population’s needs, habits, or purchasing power. The

market calls for a more affordable solution with a basic set of interactive features that

older consumers feel are comfortable to use and valuable to their lives.

The current market for physical fitness solutions is quite robust, but with a catch—

solutions are either designed for people with high digital literacy (younger demographics)

or are offered in traditional form factors that lack interactivity and personalized feedback.

The priority for consumers 50 and older is to understand how regular exercise leads to

better health and to engage in age‐appropriate exercises. Traditional solutions (e.g.,

fitness equipment or gym classes), do not offer fitness education through interactive

programs and personalized data that show what type of exercise for how long is

appropriate based on people’s age and health conditions – with the exception of personal

trainers, who are often priced out of the typical 50+ consumers’ budget.

Fitness classes along the model of Silver Sneakers provide people ages 50 and older a

socially engaging and age‐appropriate way to engage in physical exercise. Class instructors

provide personal health and fitness consultations and consumers are largely aware of

fitness classes at their local gym or YMCA, where such programs take place. Silver

Sneakers is offered as a benefit of many Medicare plans so cost is not a barrier to use. The

program has a website for users to track manually their fitness goals and activities and to

request advice from experts in nutrition, fitness and managing stress. Silver Sneakers is

innovative in its approach and business model, rather than in its use of technology. Fitness

classes for older consumers have the best marketing and outreach programs, but uptake

is still low.

Some emerging technology solutions on market offer innovative features but do not focus

on consumers 50 and older as target users. Connected fitness equipment, like iFit‐

enabled treadmills, and wearable fitness devices, like Jawbone Up, make it easy for

consumers to make goals, collect their fitness data, and track their progress. Yet these

devices are cost‐prohibitive for many older consumers and typically lack motivational and

educational elements that are unique to the 50+ population.

Challenge Statement





Online and mobile exercise trackers also help consumers track their fitness progress, but

often rely on the user to accurately and consistently input their fitness data. Solutions like

Endomondo and Runkeeper include integration with social networks and include

gamification elements (like entering into fitness “competitions” with friends) to keep

users motivated. The solutions themselves are low cost, but are most useful to

smartphone owners, which limits their reach. Like connected fitness devices, these

solutions are marketed at younger demographics so most consumers ages 50 and older

are likely unaware such solutions are available to them.

Low or inconsistent motivation to exercise

High cost of some fitness devices, gym memberships and personal trainer services

Lack of personalized instructions on how best to engage in age‐appropriate exercise Lack of feedback on performance

Product design sometimes deviates too far from common fitness device form factors,

which undermines adoption among people 50+

Lack of marketing efforts targeting 50+ to raise awareness and stimulate purchase

interest

While physical fitness tools are abundantly available, opportunities exist for solutions that

can motivate new consumer segments to exercise and market specifically to the 50+

population. New connected solutions offer exciting engagement tools, using instant

feedback, goal‐setting applications, social networking and gamification elements to

motivate users to maintain an exercise program. However, current solutions are too

cutting‐edge and high cost for most mainstream older adults.



Ability to differentiate Medium: crowded market, but the 50+ population’s needs are

overlooked

Growth potential An underserved market with potential high growth

Revenue potential Medium sized revenue potential with less defined revenue

models

Barriers to entry/

risk factors

Brand loyalty to existing solutions Awareness among consumers 50+

Patents on algorithms for sensor data interpretation and data communications methods between host and peripheral applications

Application integration and partnership challenges


Opportunity Assessment Opportunity Assessment




Current fitness tracking devices need to come down in price for mainstream adoption.

Stand‐alone sensors that are not integrated into expensive wearable devices (like

sneakers), but instead could be simply clipped to a user’s clothing, may be an option to

reduce costs. To expand beyond smartphone users, solutions could pair sensors with a

USB‐based receiver to wirelessly send data to a computer.

The market for physical fitness solutions could be enlarged tremendously if better

motivational tools are provided to attract new consumers, in addition to those who are

already engaged in fitness activities. Parks Associates research reveals that bringing

consumers’ care providers into a health and wellness program is a top motivational

factor for those who do not exercise regularly. Doctors are consumers’ most trusted

source for health and wellness information and consulting with doctors is by far the

most common activity consumers take to manage various health conditions.

Furthermore, 27% of consumers ages 50 and older who rarely exercise report they

would be motivated to better manage their health conditions if they could receive a

personalized action plan from a care provider that they could follow on their own.73

Beyond providing a role for care providers, fitness solutions should include other motivational factors, such as allowing users to post fitness goals and progress on social

networks (accountability), involving family members and friends in the fitness process

(encouragement), launching group contests to reach individual or common goals

(competition). Additionally, online and mobile fitness tracking applications should offer

daily feedback, recommend more or less intensive routines based on age, display fitness

history and health condition, and provide video demonstrations of correct form when

exercising.

A partnership between offline adult fitness class operators (e.g. SilverSneakers, Curve) and fitness tracking device manufacturers to provide age‐appropriate exercise

instruction with advanced tracking and feedback capabilities; offered as a service.

Longer‐term, a solution that links vital sign tracking, dietary tracking and fitness tracking

functionality with physician input/feedback

Digital fitness trainer solution that offers personalized/interactive fitness classes through a streaming video service to the users’ preferred device.

73 Parks Associates, Managing Care through ACOs: Consumer Interest & Requirements. 2012

New Product/ Service Concepts





3.9 Opportunities Supporting Social Engagement

Staying engaged with family, friends and the community is vital to healthy aging, with

multiple physical, behavioral and emotional health benefits. There are ample free

opportunities for older adults to engage with others in the community but mobility and

transportation barriers prevent some seniors from taking advantage of these services.

There is an opportunity for solutions to help as many as 64 million consumers age 50

and older to overcome mobility barriers and for simple, easy‐to‐use technologies to

bring more compelling engagement from the comfort of home.

The current market addressing social engagement for older adults prioritizes face‐to‐face

contact. Local senior centers, places of worship, residential communities for older adults,

and social & veterans clubs provide plenty of low‐cost or free social gatherings and events.

Part‐time work, volunteering, attending religious functions and playing a role in caretaking

for grandchildren can help older adults retain a sense of purpose. Still, these more

traditional means of social engagement are unable to reach many older adults or are

insufficient for solving some social engagement problems.

The basic barrier of transportation for older consumers who can no longer drive, or drive

in a limited fashion (e.g., only in the daytime, only in good weather), is addressed in some

communities by public transportation. To supplement public transportation, companies,

like SilverRide, and non‐profit organizations drive older consumers on an as‐needed basis.

ITNAmerica, a non‐profit organization, provides door‐to‐door transportation in private

vehicles for a yearly membership fee and a per‐ride fee that is roughly half the cost of taxi

services. SilverRide is a private company providing similar services, but limited to the San

Francisco area; it is unclear whether the SilverRide model would be sustainable in other

markets or in markets competing with non‐profit organizations like iTNAmerica.

Other solutions on market address older consumers’ in‐home communication and social

engagement needs. While landline phones are still widely used by older Americans, cell

phone penetration has surpassed two‐thirds of the 65+ population and more than half of

the same age group uses the Internet or email.74 Of those consumers ages 65 and older

who use the Internet, one‐third use social networking sites like Facebook ‐ a 150%

increase since 2009, according to Pew. Consumers ages 50 to 64 are even more connected,

which means engagement with online, mobile and social solutions by older adults will

continue to grow.

Opportunities for leveraging the Internet and mobile platforms as social engagement

platforms are plentiful. Older adults can stay in the loop with other family members

74 Pew Internet & American Life Project, Older Adults and Internet Use, June 6, 2012.

Challenge Statement





through family calendar applications, can easily receive and view pictures of grandkids

through picture sharing websites and social networks, and can engage with family

members living far away through video‐calling applications like Skype or Apple’s Facetime.

Because device manufacturers and app developers prioritize younger tech‐savvy

demographics, however, there is a dearth of simple apps that are developed for and

marketed to older consumers, creating a clear market opportunity. Apps leveraging social

networks in a simple way can help older consumers reconnect with old friends and

enlarge their social circle by making new ones.

Limited ability to leave the home due to physical mobility issues and a lack of

transportation options

Sharply reduced social circle due to moving or the passing of older friends and family

members

Unproven scalable business models for low‐cost private transportation services

Low, but growing, awareness of how social networks could be beneficial to older adults



Ability to differentiate High: Current social engagement tools are similar and largely

overlook older adults’ needs

Growth potential Large addressable market with moderate growth opportunity

depending on business models

Revenue potential Low‐to medium revenue opportunities due to less defined

business models

Barriers to entry/

risk factors

Marketing cost could be high to build awareness of new solutions

Business/revenue models less defined

Older adults’ conservative stance on user data privacy

A social network geared towards older adults is unlikely to succeed as a stand‐alone effort, since a primary benefit of social networking for older adults is engaging with family

members in younger generations. An opportunity exists to create an application or

interface built on top of Facebook to provide older users a clean, simple user experience

with fewer moving parts. The solution must provide a simple profile set‐up process, easy

access to family and friends, and simple picture viewing.

Transportation support services can be improved through the use of online scheduling

software to offer riders and their caregivers convenient tools to schedule pick‐up/drop‐

off. Safety assurance can be enhanced through the use of GPS/geo‐fencing technology to

ensure timely arrival at the correct destination.








3.10 Opportunities Addressing Diet & Nutrition

Proper diet and nutrition is fundamental to keeping older adults healthy and independent.

There is abundant information on healthy eating, tools to track food consumption are

widely available, and weight loss programs are moderately priced and heavily marketed.

Still, 38 million consumers ages 50 and older are obese and 42 million suffer from

hypertension and need to limit their sodium intake – these consumers need better, more

relevant, more accessible, and more personalized diet guidance. While this need is

currently served by dietitians or nutritionists within a chronic care program, the market

calls for a lighter, less expensive, self‐manageable, and personalized dietary solution.

The current market for diet and nutrition solutions is dominated by weight loss services.

Weightwatchers, Nutrisystem and Jenny Craig provide subscribers with the materials,

motivation, tools and sometimes even food items to lose weight. Consumers can track

their daily food intake manually using print, online or mobile food journals. Low‐fat and

low‐calorie recipes are available in cook books, magazines and recipe websites. Even with

these solutions available, many consumers have difficulty eating a proper diet consistently

and the nutritional needs of those 50 and older taking medication or suffering from

certain chronic conditions are much more complex than the need to simply drop pounds.

New dietary tracking apps and web portals have limitations as well. Although they help

users set diet goals, track their progress and provide feedback on the nutritional value of

users’ eating behaviors, effective diet tracking on these new device platforms also require

a high level of digital literacy, which many older consumers lack. At the same time, these

solutions do not advise on the type of food or diet based on users’ unique dietary

requirements. Meal Snap’s use of a smartphone camera to input meal data is a first step

towards removing that friction, though the technology is still unreliable and its database is

not yet comprehensive. Another application, Foodcalc, provides nutritional guidance for

consumers eating out, promising to take into account each user’s specific medical

conditions and dietary needs, but its algorithms can only analyze restaurant menu items

and its validity has yet to be market tested.

Low or inconsistent motivation to eat healthy and control portions

Lack of personalized dietary guidance or feedback based on health conditions and other dietary/nutritional goals

Limited access to healthy foods, due to mobility issues or limited options in certain

residential areas

Moderately high cost of weight loss systems

Incomplete and inaccurate nutritional information when dining out or doing grocery

shopping

Challenge Statement






While weight loss tools are abundantly available, opportunities exist for solutions that can

drill down to an individual level taking into account specific medical needs. Few

educational and consultation services exist to help users change their food planning,

shopping, and preparation habits. Current solutions are also too focused on consumers

eating habits as a set of choices made by an individual rather than a communal, emotional

activity based on input from multiple household members.



Ability to differentiate Solutions meet general consumer needs but opportunity

exists to differentiate solutions for people 50+ with

specific dietary needs

Growth potential Large addressable market, medium growth potential

Revenue potential Medium‐sized revenue potential with business models less

defined

Barriers to entry/

risk factors

Competition from existing weight loss services and specialized diet plan providers

Technologies and algorithms are still evolving

Low consumer awareness of new diet services and confidence in benefits

Business models remain immature

Need to form partnerships to access to food databases

Partner across device/service categories: dietary tracing devices should partner with fitness solution providers to make their services more comprehensive (e.g., Jenny Craig

with Body Media, or Spark People with Fitbit).

A healthy‐eating grocery delivery service targeting the older adult population, those with certain dietary needs, those with mobility issues or those without easy access to

nutritional food (e.g. modifcations on the Greenling.com model).

A grocery shopping guidance service or application: an in‐store dietitian (e.g. Hy‐Vee grocery store) or a digital diet assistance program on a computer or mobile phone (e.g.

FoodCalc) provides recommended food/meal options and grocery shopping lists based

on shopper’s chronic condition management needs. The digital program may offer a

dietian counciling service as a premium feature.

An augmented reality app to show fitness progress based on daily calorie intake







3.11 Opportunities Addressing Behavioral & Emotional Health

Aging in a healthy and happy way goes beyond treating our bodies well, to improving our

behavioral and emotional health as well. An estimated 26 million consumers ages 50 and

older could benefit from a behavioral/emotional health assistance program. However,

most prevalent market solutions are inconvenient and expensive. An opportunity exists

to provide older adults a service, a venue, or a solution that helps users connect with

people with a similar background in a convenient and secured way.

Current solutions on market typically address consumers’ behavioral and emotional health

needs in condition‐specific or episodic way. Consumers can attend bereavement support

groups at local community centers or places of worship or call crisis hotlines in an

emergency. Online support groups provide an easily accessible and anonymous form of

social support for people struggling with health conditions or undergoing dramatic life

changes. Professional counseling services, which could provide more long‐term support

for any number of issues, may be inaccessible for many older consumers due to high costs.

The anonymity of receiving assistance online or over the phone helps to remove the fear

and stigma of seeking help for emotional issues. Beyond traditional peer‐based online

support groups, new online counseling services provide consumers with clinical mental

health treatment that is more convenient and possibly less intimidating than in‐office

counseling sessions. CopeToday, for instance, links users and credentialed counselors

through secure messaging, online chat, telephone and videoconference. CopeToday, and

similar services from eTherapy, HealthLinkNow.com and Breakthrough, also provide users

with counselor profiles and allow users to pick which counselor to engage with. Online

and tele‐therapy business models are immature, however, and many insurers do not yet

cover services.

New solutions are also helping consumers understand the underlying causes of behavioral

and emotional problems that can lead to poor sleep quality and high levels of stress.

Sleep trackers, such as the Zeo sleep monitor or Fitbit’s Aria product, are high tech

gadgets that can help users understand and address poor sleep quality. However, the

technology is still developing, costs are high, and older consumers may be intimidated by

this high‐tech approach.

Stress tracking and management apps – such as the StressTracker app, Cleveland Clinic’s

Stress Management app, and the Relax Stress & Anxiety Relief app – provide consumers

with an immediate means to lower stress levels, through such activities as guided

breathing exercises and meditation. Users can manually track their daily moods and stress

levels to help determine their common stress triggers. SweetWater’s SweetBeat and

Challenge Statement





Affectiva’s wearable wireless Q sensors take the next step by incorporating sensor‐

technology for automatic data collection. Stress tracking apps are a cost‐effective and

always‐available solution to lowering stress, but are limited to smartphone owners and

have low revenue potential.

Social isolation prevents older adults from feeling connected, having a purpose

Unaddressed underlying problems or symptoms (e.g., poor sleep quality, high stress)

aggravate behavioral & emotional health issues

Lack of awareness of support groups Stigma associated with receiving help for emotional health

New online and phone‐based consultation services not reimbursed by payers and

awareness of these new services remains low

Overall the need for behavioral & emotional health has been addressed by current

solutions on the market but there is room for improvement, particularly regarding

convenient access and differentiated service experiences. The science behind stress

tracking algorithms can be improved as well.



Ability to differentiate Needs broadly addressed with other alternatives but current

solutions are so similar that opportunities to differentiate

from the norm exist

Growth potential Smaller market with potentially high growth due to low base

level

Revenue potential Smaller revenue potential with predictable business models

Barriers to entry/

risk factors

Competition from existing services at high and low price points: professional service providers and free online support groups

Low awareness of self‐care tools Sensors for stress tracking are still an immature technology

An online support group service that connects participants with similar backgrounds

and underlying causes, to increase users’ comfort level engaging in emotional health

discussions. Should offer the ability for people to communicate online in a group setting

using multiple communication tools, such as live chat, IM, video conferencing, and

should include an option to consult with credentialed therapists.







4.0 Market Forecasts, Investment Implications and Recommendations

4.1 Forecast Methodology and Key Assumptions

Parks Associates developed a scenario‐based revenue forecast model for market opportunities in each of the

nine challenge areas. The forecast work was conducted independently using the best available market data

from the public domain (e.g. Census/CDC data) and Parks Associates’ own research data (e.g. consumer survey

work and industry research).

These forecasts are built upon two major groups of assumptions centered on: 1) identifying the most

likely/targetable users, and 2) identifying the most likely revenue models and associated demand elasticity.

Together, these assumptions create high and low scenarios for the revenue opportunities for each challenge

area.

Step 1: Indentify the most likely/targetable users

The user assumptions start with a broadly defined addressable market metric—Affected

Population. This metric is used to quantify the size of the market where users may have

potential needs but are not necessarily actively searching for a solution. This metric is

necessarily broad and captures the entire population among consumers ages 50 and older

who may be affected by the challenge area.

The next user metric –Targeted Users—identifies users with more acute/urgent needs or

users who are actively searching for a solution. Targeted Users are a subset of the

Affected Population but a more qualified subgroup for the solutions and services targeting

each market opportunity area. Care navigation provides a good illustration of how an

Affected Population is narrowed to a Targeted Population. All consumers ages 50 and

older may have the need for a solution that helps navigate the U.S. healthcare system,

hence the Affected Population in the Care Navigation market is the entire population of

people 50+. The Targeted Users are either those who show strong frustration towards the

current healthcare system, or those who desire to improve their healthcare experience by

actively searching for tools and services.

To determine the size of Targeted Users, Parks Associates built high/low scenarios to

account for different levels of potential interest in products and services marketed directly

to consumers. The high/low interest scenarios are then weighted using a probability scale

relative to the acuteness of the need and the market gap between demand and supply (as

discussed in Section 3). In general, the more acute the need and the bigger the gap,

Affected Population

Targeted Users w/ Qualified Condition or Shown Interest

Projected Users

Weighted High/ Low Probability

Interest to Buy at High/Low Prices




the greater the weight assigned to the high interest scenario. The final targeted user metric is the weighted

average of the high/low interest scenarios.

Finally, Projected Users are those consumers Parks Associates’ estimates will constitute the actual user base of

solutions in each opportunity area. Projected Users are calculated after applying various pricing schemes to

each market opportunity area (Step Two, discussed below).

Step Two: Determine the most likely revenue models and associated demand elasticity

For revenue models and demand elasticity, the scenario development process is more complex. Any particular

solution brought to market in any of the nine challenge areas could choose to employ any number of business

models. The forecasts provided, however, are not revenue forecasts for particular solutions but, rather, are

forecasts of the potential revenue opportunities in each of the nine broad market challenge areas.

As a result, Parks Associates selected the two most likely or best applicable revenue models for each of the

nine areas (summarized in Figure 7). Our selections are based on our own research of industry practices and

outlook on business model development trends in the digital health industry.

Investment Opportunities

Product Sales

Subscription Service

Technology/ Software Fee

Advertising Sales

Medication Management

Aging with Vitality

Vital Sign Monitoring

Care Navigation

Emergency Detection & Response

Physical Fitness

Social Engagement

Diet & Nutrition

Behavioral & Emotional Health

Figure 7: Dominant Revenue Models for Market Opportunity Forecasts




The possibility that the two non‐chosen revenue models could be viable and sustainable for particular

solutions in each market opportunity area should not be ruled out. However, it is Parks Associates’ belief that

within the forecast period (2013‐2018), the two selected revenue models are most likely to dominate their

respective markets.

For each revenue model, Parks Associates built high/low scenarios based on different pricing strategies and

associated demand curves. Revenue models of product sales and subscription services are built on demand

elasticity curves derived directly from consumer survey data or indirectly from using analogous

product/services already on market. Revenue models for technology/software fees and advertising are built

on high/low usage assumptions using comparable software pricing ranges and advertising rates.

Unlike the scenarios applied to targeted users, the high/low scenarios for revenue models are not weighted by

probability. Instead, they result in a high/low range of revenue estimates for each model.

Figure 8 summarizes the entire forecast methodology. Section 4.2 provides detailed explanations of the

assumptions and results of the revenue forecasts in each market opportunity area.

Figure 8: Forecast Methodology




4.2 Market Forecasts and Investment Implications

4.2.1 Medication Management

The entire market of consumers ages 50+ is composed of nearly 100 million people, but

Parks Associates defines the Affected Population of medication management as people

taking two or more medications. Data from Parks Associates’ health survey75 show that:

70% of people ages 50‐64 take at least two medications

87% of people 65 and older take at least two medications

As a result, the affected population of medication management solutions stood at 77.7

million at the end of 2012, and Parks Associates projects that total affected users will

reach 91 million in 2018 as the population ages.

Interest in a medication management solution could be as high as 75% for a smart pill box

solution or as low as 15% for a medication tracking service, as suggested by Parks

Associates’ survey data.76 As a result, the weighted average number of the targeted users

is estimated to hit 45 million in 2013 and 53 million in 2018.

Parks Associates expects that product sales and a medication tracking subscription service

will be the two dominant revenue models for the medication management market. Our

conclusion is based on the fact that consumers are already using products such as pill

boxes with voice reminders, automatic pill dispensers, and Web/mobile phone‐based

medication reminder services. Future product and service innovations will largely follow

the same revenue models to take advantage of consumer awareness and expectation.

Medication management software licensed for smartphone and tablet use could be a

third revenue model but its potential is currently limited by the fact that people 50 and

older have lower smartphone and tablet ownership than younger consumers and are less

enthusiastic app users.

Pricing of medication monitoring devices and services was calculated at half the current

pricing for medication products on the market as we strongly believe that lower pricing

will generate sustained demand. We also used consumer data from Parks Associate’s 2010

survey showing price expectations for a medication service.77

75 Parks Associates, Market Focus: Multiple Medication Management, 2012. 76 Ibid. 77 Parks Associates, Personal Health Tools and Applications, 2010; data showed a consumer demand curve (adjusted for people 50+) based on best‐value price perceptions and an optimal pricing range based on Van Westendorp pricing analysis.

Affected Population

Targeted Population

Projected Revenue Models




Medication Management Forecast Summary

The following tables highlight the main assumptions forming the medication management solution forecasts.

Parks Associates estimates that pursuing either a product sales or a subscription service strategy could yield five‐

year total revenues as high as $3.1 billion or as low as $2 billion.

Revenue Model 1: Product Sales

2013 2018

High Price Scenario

Pricing $129 $76

Demand 5% 21%

Units Sold Annually* 2.3 million 7.9 million

Annual Revenues $293 million $601 million

5‐Year Cumulative Revenues $2.85 billion

*New/Replacement Purchase Assumption: 4‐year replacement

cycle with 25%‐35% of existing users replacing product

annually after year 4

Low Price Scenario

Pricing $89 $65

Demand 10% 31%

Units Sold Annually** 4.5 million 9.9 million



**New/Replacement Purchase Assumption: 4‐year

replacement cycle with 25%‐40% of existing users replacing

product annually after year 4

Revenue Model 2: Subscription Service

2013 2018

High Price Scenario

Monthly Service Fee $15 $11.60

Demand 3% 6%

Annual subscribers 1.4 million 3.1 million

Annual revenues $245 million $437 million


Low Price Scenario


Demand 10% 23.4%




$293

$360

$434

$564 $595 $601

$404 $426

$442

$535 $572

$639

$0

$100

$200

$300

$400

$500

$600

$700

2013 2014 2015 2016 2017 2018

Reven

ues $Millions

High Price Point Low Price Point

Medication Management Product Sales Revenue Forecast

2013‐2018

©Parks Associates for AARP, 2013

$245 $275

$308 $346

$389 $437

$381 $427

$479

$552

$647

$792

$0

$100

$200

$300

$400

$500

$600

$700

$800

$900

2013 2014 2015 2016 2017 2018

Revenues $Millions

High Service Fee Low Service Fee

Medication Management Service Fee Revenue Forecast2013‐2018





Medication management solutions’ potential for success will be strengthened if:

Health insurers and care providers continue to provide education emphasizing

medication adherence as a means to prevent adverse events

Manufacturers and service providers ad functionality to product/service designs beyond

counting pills and sending reminders; they need to demonstrate to users the benefit of

good drug adherence and offer additional value‐added features

Technology and software innvoators make product features easy to use

Solution providers offer competitive product/service pricing that brings more value to

consumers than existing ones on the market

Investors should be aware that a hardware‐centric approach would yield a sizable

revenue opportunity comparable to revenues from a service‐centric approach, but with

much lower variablity/risks.

If investors take a service‐centric approach, a lower entry price for services is preferred

as consumers are more price sensitive to service prices than to product prices.

Our demand assumptions are conservative which project only 31% of the targeted

population will purchase a medication management product and only 23% will subscribe

to a medication managmeent service by 2018. If entrepreneurs find ways to improve

consumer perception of medication management by making more compelling products

at more competitive price points, the end user demand could be much higher.

If entrepreneurs succeed in involving insurers or health providers in their business

plan – offering either marketing support or financial incentives/subsidies – end user

demand could be much higher.

Factors Impacting Success

Implications for Investors




4.2.2 Aging with Vitality

The desire to age in a comfortable and symptom‐free way is universal among people 50

and older; the Affected Population of this market is therefore the entire population of

people 50+. The affected population hit 101 million at the end of 2012, and Parks

Associates projects that the total number of people 50+ will reach 113 million in 2018,

based on U.S. Census data of aging trends.

Interest in solutions to enable people 50+ to age with vitality is broad but varies by age

groups. Parks Associates modeled higher interest among people 65 and older – for whom

the symptoms such as vision loss, hearing loss and arthritis tend to be more acute – and

lower interest among people 50‐64. As a result, the weighted average number of the

Targeted Population is estimated to be 44 million in 2013 and 49 million in 2018.

Parks Associates expects that two revenue models will prevail: one focusing on products

that address physical deterioration due to aging (such as vision/hearing aids); the other

centering on services that aim to sharpen mental skills, such as memory improvement and

cognitive training. Therefore product sales and subscription service that tap directly into

end user demand will be more likely adopted revenue model than the other two—

software/technology fee and advertising.

Parks Associates modeled the demand curve for aging with vitality products after

medication management solutions. Product unit pricing starts as high as $99 and as low

as $49 because these are the key psychological price points for technology products. For

services that help users improve cognitive skills, Parks Associates used our own estimates

of the annual paid‐user growth of Lumosity.com as a proxy to model demand elasticity.

For subscription service pricing, Parks Associates used prevailing industry pricing

practices—between $5‐15 per month.

Affected Population

Targeted Population





Aging with Vitality Forecast Summary

The following tables highlight the main assumptions forming the aging with vitality solution forecasts. Parks

Associates estimates that pursuing either a product sales or a subscription service strategy could yield five‐year

total revenues as high as $2.9 billion or as low as $1.2 billion.


2013 2018

High Price Scenario

Pricing $99 $58

Demand 5% 17%





cycle with 25% of existing users replacing product annually

after year 5

Low Price Scenario

Pricing $49 $29

Demand 8% 33%








2013 2018

High Price Scenario


Demand 3% 6%




Low Price Scenario


Demand 5% 12.4%




$218 $218 $236

$263

$363

$441

$172 $167 $175

$225

$284

$372

$0

$50

$100

$150

$200

$250

$300

$350

$400

$450

$500

2013 2014 2015 2016 2017 2018

Revenues $Millions


Aging with Vitality Product Sales Revenue Forecast2013‐2018


$237 $264

$294

$328

$367

$410

$132 $153

$178

$207

$241

$282

$0

$50

$100

$150

$200

$250

$300

$350

$400

$450

2013 2014 2015 2016 2017 2018

Revenues $Millions


Aging with Vitality Service Fee Revenue Forecast2013‐2018





Solutions enabling a better aging experience will have a stronger potential for success if:

Marketing messages stress fun in aging to drive user interest in aging‐mitigating

solutions

New solutions become more affordable and designs differentiate from convention to

give consumers a new experience

Aging‐mitigation features and underlying technologies (text‐to‐speech, gesture and

voice recognition input technoogy) are integrated into existing products that the

target population is already familiar with, reducing the need to purchase a dedicated

device or service

Investors should be aware that purchase behaviors of people 50+ might slow down

product revenue growth on an annual basis. Parks Associates modeled relatively low

elasticity of demand for products that address aging needs due to this age group’s low

impulse‐driven purchase habits and longer replacement cycle for products in this

category. Investors could improve product features to increase demand and/or speed

up the product replacement cycle. Despite slower annual product sales revenues, this

model still represents an attractive opportunity in this market because cumulative

revenues over the forecast period are substantial.

Cumulative service revenues are as high as product revenues in this market, but service

revenue growth is steady and positive. The recurring revenue stream from a service‐

centric business model also helps stablize margin and reduce business volatility caused

by shifting demand and rising competition.

Our demand assumptions are conservative across the board in this market, which

project only 33% of the targeted population will purchase a product addressing their

anti‐aging needs, and only 12% will use a direct‐to‐consumer service to improve age‐

induced cognitive wellness challenges. As this market is completely driven by retail

product and service innovations, a breakthrough product/service concept could

signficantly raise demand above our assumptions, resulting in upside surprises on

estimated buyers and revenues. In other words, entrepreneurs could unlock dormant

demand by focusing on non‐conventional product designs and smart marketing

campaigns to achieve higher revenue growth than our models imply.






4.2.3 Vital Sign Monitoring

An estimated 78 million consumers ages 50 and older have at least one chronic condition.

Incidences of people 50+ suffering from the following chronic conditions are based on CDC

data and Parks Associates’ estimates:

Diabetes or pre‐diabetes: 44% (people between 50‐64)‐60% (people 65+)

Hypertension: 48% (2013)‐51% (2018)

COPD: 5% (2013‐2018)

Heart Failure: 1.7% (2013‐2018)

Other types of more severe chronic conditions: 6% (2013‐2018)

Parks Associates estimates that up to 30% of the 50+ population suffers from more than

one severe chronic condition. After accounting for co‐morbidity, the Affected Population

figures are estimated at 79 million in 2013 and increase to 86 million in 2018.

Interest in a vital sign monitoring solution could be as high as 75% for people suffering

severe chronic illnesses like COPD and heart failure, but could be as low as 15% for those

with less severe conditions, based on Parks Associates’ survey data78. As a result, the

weighted average number of Targeted Users is estimated at 45 million in 2013 and 49

million in 2018.

Parks Associates expects that product sales and vital sign monitoring subscription services

will be the two dominant revenue models for this market. Software/technology to assist

vital sign monitoring solutions may generate additional revenues through a licensing

arrangement but it will be a small amount relative to product sales and service revenues,

which have been the staples for this industry.

For product sales, Parks Associates estimates that a high‐end vital sign monitoring device

could cost $300 in 2013 whereas a low‐end solution using smartphones or tablets as host

gateways could lower product prices substantially to $99 in 2013. These prices are slightly

lower than current solutions on the market. Assuming a gradual price decline of 5‐10%,

which is common in the consumer electronics industry, consumer demand would follow a

typical demand curve model and rise in the double digits (22‐24%).

For a subscription service, the demand elasticity was modeled on Parks Associates’

consumer survey data in 2010. The high/low‐end prices are two ends of an optimal pricing

range obtained through a Van Westendorp79 model for a vital sign monitoring service.

78 Parks Associates, Personal Health Tools and Applications, 2010 79 Van Westendorp model is a pricing sensitivity analysis technique widely used in market research. See Appendix C

Targeted Population


Affected Population




Vital Sign Monitoring Forecast Summary

The following tables highlight the main assumptions forming the vital sign monitoring solution forecasts. Parks

Associates estimates that pursuing either a product sales or a subscription service strategy could yield five‐year

total revenues as high as $4.8 billion or as low as $2.3 billion.


2013 2018

High Price Scenario

Pricing $300 $177

Demand 5% 15%


Annual Revenues $675 million $1.03 billion





Low Price Scenario

Pricing $99 $58

Demand 8% 22%








2013 2018

High Price Scenario


Demand 3% 6%




Low Price Scenario


Demand 4% 9.9%




$675 $703 $727 $744

$943

$1,030

$356 $360 $358 $350

$455 $453

$0

$200

$400

$600

$800

$1,000

$1,200

2013 2014 2015 2016 2017 2018

Revenues $Millions


Vital Sign Monitoring Product Sales Revenue Forecast

2013‐2018


$405 $449

$499

$554

$617

$687

$324 $359

$399 $443

$515

$673

$0

$100

$200

$300

$400

$500

$600

$700

$800

2013 2014 2015 2016 2017 2018

Revenues $Millions


Vital Sign Monitoring Service Fee Revenue Forecast

2013‐2018





Vital sign monitoring solutions’ potential for success will be strengthened if:

Device manufacturers continue to enhance connectivity and interactivity through

software innovation and make hardware easy to carry and simple to operate

Physicians become more involved in patient’s day‐to‐day management of chronic

conditions, encouraging patients to track vital sign changes and report back results

Device pricing becomes more affordable or functions become more integrated to

reduce purchases of individual devices

Monitored service subscription fees become more affordable as payers provide

incentives to encourage home use of vital sign monitoring services

Investors should be aware that although a hardware‐centric approach could generate a

bigger revenue opportunity than a service‐centric approach, demand for hardware is

subject to a higher level of price sensitivity. For a low‐price entry strategy, sales margins

in the early years of investment would come under pressure, resulting in a longer

payback time.

Both revenue models assume a direct‐to‐consumer strategy. Entrepreneurs may face

competition from payers and providers offering their own‐branded vital sign monitoring

devices or services as part of a chronic care management service without directly

charging end users hardware or service fees.

Our demand assumptions are conservative, which project only 22% of the targeted

population will purchase a vital sign monitoring solution and only 10% will use a direct‐

to‐consumer vital sign monitoring service in 2018. If entrepreneurs find ways to

convince consumers to approach vital sign monitoring as a self‐help tool instead of

waiting for health insurers to offer a chronic care management service, the end user

demand could be much higher.

If health insurers or providers change their current practice of directly funding vital

sign monitoring devices/services to a strategy of incentivizing retail adoption of vital

sign monitoring solutions/services, this market will grow at much higher rate.






4.2.4 Care Navigation

All American consumers ages 50 and older would benefit from solutions that could help

navigate the extraordinarily complex healthcare market. Parks Associates therefore

defines the Affected Population for care navigation solutions as people ages 50+,

including 61 million people 50‐64 and 42 million people 65+ in 2013. By 2018, these

populations will increase to 66 million and 48 million respectively

Parks Associates narrowed the affected population according to estimates of users’

interest in a care navigation service. Parks Associates estimated 50% of the 50+ population

would be interested in a care navigation solution under a strong interest scenario and 10%

would be interested under a weak interest scenario.

As a result, the weighted average number of the targeted population is estimated at 34.9

million in 2013 and 38.5 million in 2018.

Parks Associates expects that a fee‐based care assistance service and advertising sales will

be the two dominant revenue models for the care navigation market.

We modeled the fee‐based care assistance opportunity on current care concierge services,

but with a much lower average monthly fee. Demand is based on consumer interest

expressed in Parks Associates’ latest survey.80 To calculate the revenue opportunity, the

following scenarios and assumptions were applied:

1) Parks Associates believes that a monthly rate of $50 is a reasonable high price point,

because a health concierge service is typically priced between $30‐$250 per user.

Overtime, the price will drop not because care delivery costs decrease, but because

the competitive nature of this consumer market will force vendors to cut prices.

2) Alternatively, a lower price point of $25 per month could open up bigger

opportunities. We expect a naturally declining price from the $25 level will help care

navigation services recruit more than 3.7 million people in 2018.

3) Finally, if a paid care navigation service fails to rally adequate demand, an ad

supported model could be employed. Ad revenue would be much lower, due to a low

CPM rate.

80 Parks Associates: Managing Care through ACOs: Consumer interest and requirements, 2012.


Affected Population

Targeted Population




Care Navigation Forecast Summary

The following tables highlight the main assumptions forming the care navigation solution forecasts. Parks

Associates estimates that pursuing either a service fee or advertising sales strategy could yield five‐year total

revenues as high as $3.3 billion or as low as $360 million.

Revenue Model 2: Advertising Sales

2013 2018

High User Scenario

User Base 24.4 million 32.7 million

Ad Impressions (per user/month)

50 63.8

Avg. CPM $5 $5

Total ad revenues $73 million $125 million

5‐Year Cumulative Revenues $567 million

Low User Scenario



60 76.6

Avg. CPM $5 $5




2013 2018

High Price Scenario


Demand 2% 4%




Low Price Scenario


Demand 3% 9.5%

Annual subscribers 1 million 3.7 million



$419 $466

$518

$577

$644

$719

$314 $345

$396

$454

$542

$684

$0

$100

$200

$300

$400

$500

$600

$700

$800

2013 2014 2015 2016 2017 2018

Revenues $Millions


Care Navigation Service Fee Revenue Forecast

2013‐2018


$73 $78

$84

$96

$110

$125

$38

$47

$57

$69

$82

$106

$0

$20

$40

$60

$80

$100

$120

$140

2013 2014 2015 2016 2017 2018

Revenues $Millions

High User Scenario Low User Scenario

Care Navigation Advertising Sales Revenue Forecast

2013‐2018





Care navigation solutions will have a stronger potential for success if:

Future solutions are comprehensive, personalized, and bring real value to customers

Solutions are feature‐rich and provide immediate benefits (e.g. medical savings, better

health service choices) to overcome overcome consumer’s price resistance

Solutions offer more affordable service pricing to drive service volume; alternative

revenue models could subsidize service costs

A care assistance service model generates 6x more revenues over the forecast period

than does an advertising‐driven business model. Although the attractiveness of the two

models is evident from a revenue perspective, we caution that service revenues are

highly dependent on target users’ value perception. The ability to offer a personalized

care assistance service will justify an average monthly service fee of $38 from an

adopter perspective and will support the long‐term viability of this model to solve the

care navigation challenge in the U.S.

Ad targetability heavily influences ad pricing. A major risk to our advertising revenue

forecast in this market is the contraction of display ad pricing on Websites and print

media. Our assumption of $5 CPM is a mid‐range figure and could face pricing pressure

from advertisers that are less interesting in the older demographics. If investors and

entrepreneurs could incorprate ad targeting technology into their solutions, they can

preserve their ad rates and protect them from negative pricing trends seen in the online

display ad market. On the other hand, if their targeting algorithms are robust enough,

they can offer performance‐based ad inventory to brands and advertisers that want to

engage with people 50+ with unique products and services. This scenario could increase

advertising revenue opportunity currently not reflected in our forecast model.






4.2.5 Emergency Detection & Response

Parks Associates defines the Affected Population for emergency detection and response

solutions as people ages 50+, including 84 million people 50‐74 and 19 million people 75+

in 2013. By 2018, they will increase to 92 million and 21 million respectively.


interest in an emergency detection or response service. Because consumers ages 75 and

older are much more likely to need and use an emergency service, Parks Associates

weighted the potential interest of this age group higher than other age groups.

Under a strong interest scenario, we estimated 75% of the 75+ population and 30% of the

50‐74 population would be interested in an emergency detection or response service.

Under a weak interest scenario, we estimated 40% of 75+ consumers and 10% of those

50‐74 would be interested in such a solution.

The weighted average number of the Targeted Population is estimated at 25.7 million in

2013 and 28.3 million in 2018.

Parks Associates expects that product sales and emergency monitoring service fees will be

the two dominant revenue models for the emergency detection and response market,

because they are the most prominent and successful ones on the market today, and we

continue to expect them to do well in the future.

We also used consumer price expectations ($15‐$25/month) for a personal emergency

response service (PERS) from Parks Associates’ 2010 survey data.81 Parks Associates

modeled moderate growth of the underlying user base of the emergency detection

service as well as potential hardware sales for the next six years if price is at the high end

of the range. Demand will be more elastic if price drops below $20 per month. This

assumption is built on the fact that the age sweet spot for emergency detection and

response service is 70+ and also our own research showing that these consumers are

more price sensitive than people in younger age groups.

81 Parks Associates, Personal Health Tools and Applications, 2010; Data showed a consumer demand curve (adjusted for people 50+) based on best‐value price perceptions and an optimal pricing range based on Van Westendorp pricing analysis


Affected Population

Targeted Population




Emergency Detection & Response Forecast Summary

The following tables highlight the main assumptions forming the emergency detection and response solution

forecasts. Parks Associates estimates that pursuing either a product sales or service fee strategy could yield five‐

year total revenues as high as $2.3 billion or as low as $1.3 billion.


2013 2018

High Price Scenario

Pricing $229 $135

Demand 3% 10%




Low Price Scenario

Pricing $129 $76

Demand 6% 23%








2013 2018

High Price Scenario


Demand 3% 6%




Low Price Scenario


Demand 5% 17.7%

Annual subscribers 1.3 million 5 million



$176 $180 $192

$231

$299

$391

$199 $206 $219

$270

$329

$402

$0

$50

$100

$150

$200

$250

$300

$350

$400

$450

2013 2014 2015 2016 2017 2018

Revenues $Millions


Emergency Detection/Response Product Sales Revenue Forecast2013‐2018


$231 $257

$286 $319

$355 $397

$231 $268

$324

$393

$514

$699

$0

$100

$200

$300

$400

$500

$600

$700

$800

2013 2014 2015 2016 2017 2018

Revenues $Millions


Emergency Detection/Response Service Fee Revenue Forecast

2013‐2018





Solutions enabling emergency detection and response will have a stronger potential for

success if:

Technology advances continue to make this product category more portable, wider in

range, less error‐prone and more affordable

Better product design removes the stigma associated with this product category, making

people 50 and older more willing to use such a product in and outside of the home

Channel strategies are diversified; expanded retail availability and business referral

programs would reduce distribution costs and extend user reach

For investors and entrepreneurs, people 75 and older are easier targets than people

50‐74, but this market’s long‐term revenue opportunity lies with vendors’ ability to

boost interest among younger demographics. Adding this new marketsegment to

existing demand could potentially jumpstart the total addressable market and

increase revneue over time.

Demand in this market is more sensitive to price decreases than in adjacent markets.

Although Parks Associates employed very conservative estimates (up to 23% interested

in a product and up to 18% interested in a service), more portable product designs with

integrated lifestyle functions could appeal to a greater portion of the targeted users and

raise our revenue projections.

A risk factor to our service revenue forecast is the churn rate. Younger demographic

users are more likely to drop existing services and try something new, driving the churn

rate higher and the service revenues lower over time. Service providers could offer

customer appreciation programs or loyalty memberships to reduce this risk factor to

service revenues.






4.2.6 Physical Fitness

The need to engage in regular, age‐appropriate physical fitness is universal among people

50 and older; the Affected Population of this market is therefore the entire population of

people 50+. The affected population hit 101 million at the end of 2012, and Parks

Associates projects that the total number of people 50+ will reach 113 million in 2018,

based on U.S. Census data of aging trends.


interest in a physical fitness solution. Under a strong interest scenario, we estimated 60%

of the 50‐64 population and 50% of the 75+ population would be interested in a physical

fitness solution. Under a weak interest scenario, we estimated 25% of 50‐64 and 15% of

the 65+ population would be interested in such a solution. We assumed the strong

interest scenario would be more likely for the 50‐64 year old group and the weak scenario

more likely for the 65+ population.

As a result, the weighted average number of the Targeted Population is estimated at 38.1


Parks Associates expects that product sales and fitness service fees will be the two

dominant revenue models for the physical fitness market. However, technology/software

licensing and advertising‐based models are likely to be supplementary in nature to the

two dominant business models in physical fitness.

To assess the revenue opportunity in the physical fitness market, the following scenarios

and assumptions are applied:

1. Parks Associates modeled demand for fitness products based on our tracking of the

connected fitness industry growth. For people 50 and older, demand is less sensitive

to price decline. As a result, our model assumes that

‐ At a higher price point ($129), a 10% price decline can generate, on average, a 25%

increase in demand.

‐ At a lower price point ($89), a 10% price decline can generate, on average, a 33%

increase in demand

2. Parks Associates modeled demand for fitness services based on its tracking of fitness

app usage growth. However, we tempered service user growth for the 50+ market

because slower changes in purchase behaviors of this age group moderates demand.


Affected Population

Targeted Population




Physical Fitness Forecast Summary

The following tables highlight the main assumptions forming the physical fitness solution forecasts. Parks

Associates estimates that Pursuing either a product sales or service fee strategy could yield five‐year total

revenues as high as $1.7 billion or as low as $1.1 billion.


2013 2018

High Price Scenario

Pricing $129 $76

Demand 5% 15%

Units Sold Annually* 1.9 million 6 million



Low Price Scenario

Pricing $89 $53

Demand 6% 25%








2013 2018

High Price Scenario


Demand 3% 6%

Annual subscribers 1.1 million $2.5 million



Low Price Scenario

Monthly Service Fee $5 $4

Demand 5% 15.8%




$246 $246 $256

$301

$370

$460

$204 $211 $216

$277

$347

$442

$0

$50

$100

$150

$200

$250

$300

$350

$400

$450

$500

2013 2014 2015 2016 2017 2018

Revenues $Millions


Physical Fitness Product Sales Revenue Forecast

2013‐2018


$206 $229

$255

$284

$317

$354

$114 $133

$161

$194

$245

$316

$0

$50

$100

$150

$200

$250

$300

$350

$400

2013 2014 2015 2016 2017 2018

Revenues $Millions


Physical Fitness Service Fee Revenue Forecast2013‐2018





Physical fitness solutions will have a stronger potential for success if:

Vendors are able to integrate multiple sources of data to give users a richer and more

comprehensive view of their physical fitness activity and outcomes

Payers incentivize consumers to track their fitness/wellness progress

Technological advances result in a dramatic reduction in form factor and price

Technology savvyness of consumers 50 and older continues to rise

End‐user demand is likely most robust among people 50‐64 but current fitness products

and services have done little to cater to this age group’s needs and technology

savvyness. We recommend entrepreneurs to target this age group aggressively before

considering the older 65+ group to maximize near term revenue opportunities.

Our demand assumptions are conservative in this market, which project only 25% of the

targeted population will purchase a physical fitness product and only up tp 16% will use

a direct‐to‐consumer fitness service in 2018. Demand may become more elastic if

device makers/service providers can associate their product user experience with

proven health benefits that matter most to people 50 and older. Smart marketing

messages and innovative designs may unlock demand to be much higher than our

model suggests.

A hardware‐centric strategy not only offers a greater cumulative revenue opportunity,

but also assumes lower risk as reflected in a narrower revenue range for hardware sales

than for service revenues. In other words, the hardware sales model is a safer bet than

the service revenue model.

Product designs in this competitive industry are essential in driving consumer demand,

especially given the fact that this market has attracted large brands like Nike as well as

many start‐up companies. A differentiated product design is not only a competitive

advantage but also a brand asset to drive sustainable market demand.






4.2.7 Social Engagement

Parks Associates defines the Affected Population for social engagement solutions as the

entire consumer population ages 50 and above, including 61 million people ages 50‐64

and 42 million people 65 and older, in 2013. By 2018, these age groups will increase to 66

million and 48 million respectively.


interest in a social engagement service, and assumed higher interest among users ages 50‐

64 than for those ages 65 and older. Parks Associates estimated 80% of the 50‐64

population and 70% of the 65+ population would be interested in a social engagement

solution under a strong interest scenario. We estimated 40% of consumers 50‐64 and 30%

of consumers 65+ would be interested under a weak interest scenario.



Parks Associates expects that technology/software licensing and advertising sales will be

the two dominant revenue models for the social engagement market. We expect that

vendors could build social engagement software into existing services that target people

50 and older. For instance, social networking software can be built into a transportation

service to help older adults get more easily connected. Alternatively, an online network

aiming to connect people 50 and older can monetize its visitor traffic through targeted

advertising and sponsorships. Both revenue models depend on the user base of the

services. To assess revenue potential for the social engagement market, the following

scenarios and assumptions are applied:

1. For software/technology fee, Parks Associates assumes 20% of target users would

adopt the underlying software in 2013, growing to 40‐44% of target users in 2018. We

also assume standard software licensing terms based on per‐user per‐year usage. A

price range of $2‐$5 is used to quantify the high and low‐end of the

software/technology fee revenue potential for the social engagement market.

2. For advertising revenues, Parks Associates assumes high/low adoption of the

underlying social engagement service at 70%/40% in 2013, increasing to 85%/65% in

2018. A conservative ad rate of $5 CPM is used to reflect the average ad rate for this

demographic group from advertisers.

Pursuing either a technology/software license fee or advertising sales strategy could yield

five‐year total revenues as high as $959 million or as low as $236 million.

Targeted Population


Affected Population




Social Engagement Forecast Summary

The following tables highlight the main assumptions forming the social engagement solution forecasts. Parks

Associates estimates that pursuing either a technology/software license fee or advertising sales strategy could

yield five‐year total revenues as high as $959 million or as low as $236 million.

Revenue Model 1: Software License Fee

2013 2018

High Fee Scenario

Pricing $5 $5

Usage Growth 20% 40%

Tech/Software Users 12.8 million 28.3 million



Low Fee Scenario

Pricing $2 $2






2013 2018

High User Scenario



50 63.8

Avg. CPM $5 $5



Low User Scenario



60 76.6

Avg. CPM $5 $5



$64

$75

$88

$103

$120

$141

$26 $30

$35 $41

$50

$62

$0

$20

$40

$60

$80

$100

$120

$140

$160

2013 2014 2015 2016 2017 2018

Revenues $Millions

High License Fee Low License Fee

Social Engagement Technology/Software License Fee Revenue Forecast, 2013‐2018


$134 $143

$153

$176

$201

$229

$69

$86

$105

$126

$151

$194

$0

$50

$100

$150

$200

$250

2013 2014 2015 2016 2017 2018

Revenues $Millions


Social Engagement Advertising Sales Revenue Forecast

2013‐2018





Solutions enabling social engagement will have a stronger potential for success if:

Designs are tailored to the needs of consumers 50 and older to help them solve real‐

world challenges through better social connectivity

There is a continued increase in awareness of and comfort using social

engagement/connectivity tools on PC/mobile among people 50+

Solutions incorporate the ability to target users with ads that bring value to selected

marketers interested in engaging 50+ consumers

Solutions integrate with other popular social networks and services that people 50+

frequently use

Revenue varianace is mainly driven by assumed user growth of related products and

services that use social engagement technologies or solutions. It is important for

investors and entrepreneuers to make such solutions broadly applicable so that user

exposure is maximized. Clearly, partnerships are very important, as is the ability to offer

open/customized APIs to have the technology/solution easily integratable with existing

products and services.

Our ad impression assumptions are conservative; we project only 50 ad impressions per

user per month for services attracting a large percentage of targeted users and 60 ad

impressions for services with a smaller audience size. Technologies that can increase the

target population’s interactivity with social engagement services will boost ad

impression levels and lead to higher advertising revenues than our models suggest.

Ad targetability heavily influences ad pricing. A major risk to our advertising revenue

forecast in this market is the contraction of display ad pricing on Websites and print

media. Our assumption of $5 CPM is a mid‐range figure and could face pricing pressure

from advertisers that are less interesting in older demographics. If investors and

entrepreneurs could incorprate ad targeting technology into their solutions, they can

preserve their ad rates and pretect them from negative pricing trends seen in the

online display ad market.






4.2.8 Diet & Nutrition

A nutritious diet is essential to the healthy living of all consumers ages 50 and older. Parks

Associates therefore defines the Affected Population for diet and nutrition solutions as

people ages 50+, including 61 million people 50‐64 and 42 million people 65+ in 2013. By

2018, these populations will increase to 66 million and 48 million respectively.


interest in a diet and nutrition service. Under a strong interest scenario, we estimated 60%

of the 50‐64 population and 70% of the 65+ population would be interested in a diet or

nutrition service. Under a weak interest scenario, we estimated 30% of both 50‐64 and

65+ populations would be interested in such a service.



Parks Associates expects that a fee‐based diet and nutrition management service and

technology/software licensing fees will be the two dominant revenue models for the diet

and nutrition market. A diet management service has gained significant consumer

awareness during the last decade due to wellness initiatives and weight loss programs.

Diet/nutrition related software and technology have appeared more recently in the online

and mobile market.

To calculate the revenue opportunity, the following scenarios and assumptions were

applied:

1. We expect moderate growth of user‐paid dietary/nutrition management service if

offered at a premium rate of $15 per month. At $5 per month, however, growth will

accelerate particularly among consumers in the younger age group (50‐64). Our

demand curve was modeled after vital sign monitoring services but at a higher

sensitivity because users of these services are likely younger and price of

diet/nutritional service in general is substantially lower than a vital sign monitoring

service.

2. Parks Associates assumes that software that enables dietary/ nutritional education

and coaching will be subject to the same licensing term as in the social engagement

technology market. Underlying software user growth is also similar to that from social

engagement market due to strong similarity of user profiles between these two

markets.

Targeted Population


Affected Population




Diet & Nutrition Forecast Summary

The following tables highlight the main assumptions forming the diet and nutrition solution forecasts. Parks

Associates estimates that pursuing either a service fee or technology/software license fee strategy could yield

five‐year total revenues as high as $1.6 billion or as low as $199 million.


2013 2018

High Price Scenario


Demand 3% 6.3%




Low Price Scenario


Demand 5% 15.8%





2013 2018

High Fee Scenario

Pricing $5 $5





Low Fee Scenario

Pricing $2 $2





$167 $185

$205 $228

$253

$293

$185 $203

$232

$265

$315

$396

$0

$50

$100

$150

$200

$250

$300

$350

$400

$450

2013 2014 2015 2016 2017 2018

Revenues $Millions


Diet & Nutrition Service Fee Revenue Forecast

2013‐2018


$54

$63

$74

$86

$101

$119

$21 $25

$31 $37

$43

$52

$0

$20

$40

$60

$80

$100

$120

$140

2013 2014 2015 2016 2017 2018

Revenues $Millions


Diet & Nutrition Technology/Software License Fee

Revenue Forecast, 2013‐2018





Diet and nutrition solutions will have a stronger potential for success if:

Chronic care management programs feature the ability to add diet and nutrition

management functionality to their services

Broader wellness services integration diet and nutrition data, expanding the market for

diet and nutrition software licencing

Diet and nutrition features are subsidized through new innovative service models

Diet and nutrition management services generate 3x more revenue than does the model

of charging a technology/software fee based on user counts. But a risk factor to the

service model is the churn rate, which is influenced by competing solutions in the diet

and nutrition service business; some competing services are totally free as a component

of a comprehensive disease management program. As a result, investors and

entrepreneurs must create a differentiated experience with documented results to keep

users from defecting too soon.

Our demand assumptions are conservative for both the technology/software fee model

and the service revenue model, which project only 40% of the targeted population will

use a diet/nutrition related service and only 16% will use a direct‐to‐consumer diet and

nutrition service in 2018. Technologies with unique algorithms and open architechture

to be embedded in a broad array of online services could experience much higher user

adoption. Services with unique features could also garner higher adoption rates than

our models suggest.

Diet and nutritional service demand becomes more elastic once the monthly service

price drops below $10. Investors and entrepreneurs must weigh the impact of lower

pricing on the program’s gross margin against the potential increase in demand before

taking aggressive price cuts.






4.2.9 Behavioral & Emotional Health

Parks Associates defines the Affected Population for behavioral and emotional health

solutions as people ages 50+, including 61 million people 50‐64 and 42 million people 65+

in 2013. By 2018, they will increase to 66 million and 48 million respectively. This category

includes divorce and grief support, which most consumers would benefit from as they lose

parents (50‐64 year old group), or spouses and other close peers (65+ group).


interest in a behavioral and emotional health service. Parks Associates estimated 30% of

the 50+ population would be interested in a behavioral or emotional health solution

under a strong interest scenario and 10% would be interested under a weak interest

scenario. Our assumptions exclude health insurance‐covered cases in which users seek

clinical help to deal with most severe cases of behavioral/emotional health problems.

As a result, the weighted average number of the Targeted Population is estimated to hit

26.3 million in 2013 and 29.1 million in 2018.

Parks Associates expects that technology/software licensing and advertising sales will be

the two dominant revenue models for the behavioral and emotional health market. The

need for behavioral and emotional health can be directly addressed by a professional

healthcare service paid for by a health insurer. Our forecasts in this category, however,

factor in only those products and services paid for by consumers or that include a usage

decision that is heavily influenced by consumers themselves.

To assess revenue potential for the social engagement market, the following scenarios

and assumptions were applied:

1. For a software/technology fee model, Parks Associates assumes 30% of target users

would adopt the underlying software in 2013, growing to 60% of target users in 2018.

We also assume standard software licensing terms based on per‐user per year usage.

A price range of $2‐$4 is used to quantify the high and low‐ends of the

software/technology fee revenue potential for the behavioral & emotional health

market.

2. For advertising revenues, Parks Associates assumes high/low adoption of the

underlying behavioral/emotional service at 70%/30% in 2013, increasing to 85%/60%

in 2018. A conservative ad rate of $5 CPM is used to reflect the average ad rate for

this demographic group from advertisers.

Affected Population

Targeted Population





Behavioral & Emotional Health Forecast Summary

The following tables highlight the main assumptions forming the behavioral and emotional health solution

forecasts. Parks Associates estimates that pursuing either a technology/software license fee or advertising sales

strategy could yield five‐year total revenues as high as $428 million or as low as $145 million.


2013 2018

High Fee Scenario

Pricing $4 $4


Tech/Software Users 7.9 million $17.5 million



Low Fee Scenario

Pricing $2 $2






2013 2018

High User Scenario



50 63.8

Avg. CPM $5 $5



Low User Scenario



60 99

Avg. CPM $5 $5



$32

$38

$44

$50

$57

$70

$16 $19

$22 $25

$28

$35

$0

$10

$20

$30

$40

$50

$60

$70

$80

2013 2014 2015 2016 2017 2018

Revenues $Millions


Behavioral & Emotional Health Technology/Software License Fee Revenue Forecast, 2013‐2018


$55 $59

$63

$73

$83

$95

$28 $35

$45

$56

$73

$104

$0

$20

$40

$60

$80

$100

$120

2013 2014 2015 2016 2017 2018

Revenues $Millions


Behavioral & Emotional Health Advertising Sales Revenue Forecast2013‐2018





Emotional and behavioral health solutions will have a stronger potential for success if:

Better education efforts are undertaken to make services available and accessible to

people 50 and older

Solutions determine methods to target users with ads without triggering their privacy

concerns

Technology advances generate better insights about consumer behavioral/emotional

needs

Vendors integrate behavioral/emotional health solutions into a broader service and

deliver a fun experience for users

Behavioral and emotional health for people 50+ represents a small market for

entrepreneurs and investors despite its targeted user base being similar to that of the

market for emergency detection and response solutions. To excel in this relatively

“niche” market segment, investors and entrepreneurs must clearly communicate their

offering’s value proposition to target users and increase engagement levels through

personalized service features. The main monetization methods—technology fees and

advertising revenues – rely heavily on user loyalty and frequency of interaction with the

service.

Investors and entrepreneurs also need to make behavioral and emotional health a

supplementary component of a broader health/wellness solution in order to increase

end user exposure and drive service/feature utilization. Effective content and

distribution partners and open/customizable APIs for easy integration are key to

overcoming user acquisition barriers and to maintaining healthy advertising CPM rates

Advertising offers greater revenue opportunity but competition is also likely to be

intense. Technology fee revenues depend heavily on the software’s performance in

driving usage volume, and therefore a solution employing the latter business model is

easier to differentiate from the competition.






5.0 Summary and Conclusions

The healthy living market for consumers 50 and older presents both short‐term and long‐term investment

opportunities. After analyzing the 32 different healthy living needs of people 50+ with these critical business

model questions in mind, Parks Associates concludes that nine areas of the healthy living market represent the

best investment opportunities for break‐through technologies, innovative products, and disruptive services.

Figure 9 summarizes these opportunities.

When evaluating these nine areas to formulate an investment strategy, investors and entrepreneurs must

take into consideration not only the upside revenue potential, but also underlying target user growth trends,

variability of revenue estimates, and unique market factors that could aid or hurt investment/business growth.

Parks Associates strongly recommends that investors and entrepreneurs focus on areas that serve a large

and/or fast‐growing target user base, offer high revenue opportunity with low variance, feature lower‐than

aveage business risks and a strong opportunity for differentiation.

Revenue opportunity variance, measured by the ratio of Parks Associates’ high‐end to low‐end revenue

estimates in Figure 10, reflects our assessment of the business risks and entry barriers in each of the nine

areas. A low ratio of maximum to minimum revenue estimates (low revenue variance) is an indicator of higher

visibility of revenue streams, more mature revenue models, and lower probability of unknown business risks.

A high revenue variance points to just the opposite. Although a low‐business‐risk/low‐entry‐barrier market

Figure 9: Summary of Nine Market Opportunities

High‐end

Estimates

Low‐end

Estimates

Revenue

Variance

Highest

5‐Yr CAGR

Product

Sales

Monthly

Service

Technology/

Software

Ad

Sales

Medication Management 1 52M Up to 34M $3.3B $2.0B 1.64 16%

Aging with Vitality 2 49M Up to 42M $1.9B $1.2B 1.59 17%

Vital Sign Monitoring 3 49M Up to 28M $4.8B $2.3B 2.07 16%

Care Navigation 4 39M Up to 27M $3.3B $400M 8.36 23%

Emergency Detection & Response 5 28M Up to 15M $2.4B $1.5B 1.65 25%

Physical Fitness 6 42M Up to 22M $1.8B $1.2B 1.61 23%

Social Engagement 7 70M Up to 49M $1.0B $243M 4.26 23%

Diet & Nutrition 8 59M Up to 24M $1.6B $210B 7.61 20%

Behavioral & Emotional Health 9 29M Up to 24M $428M $145M 2.95 30%

Dominant Revenue Models

Opportunity AreaOverall

Ranking

Targeted

Users

(2018)

Projected

Users

(2018)

2013‐2018 Cumulative Revenues




usually means more intense competition and sometimes a lower likelihood of differentiation, these

opportunities remain very attractive as long as the user base is large and revenue growth is satisfactory (>10%

CAGR).

Figure 10: Projected Revenue Ranges: Low/High‐end Market Opportunities

For instance, the medication management market has a low revenue forecast range (between $2 billion to

$3.3 billion), and thus a low variance of 1.64. By contrast, Care Navigation has a much wider revenue forecast

range (between $400 million and $3.3 billion) and a variance of 8.36. This contrast reflects our belief that the

medication management market has lower investment risks than the care navigation market, even though the

revenue potential of the latter is larger.

To be more specific, the downside risk is more significant for care navigation’s main revenue models:

subscription services and advertising sales. A subscription service to help consumers navigate through the

complex U.S. health system is still an embryonic concept and could face stiff resistance from targeted users,

especially if required to pay out of pocket. The advertising model, on the other hand, faces uncertainties

regarding whether such a service can attract advertising dollars with a sufficient amount of visitor traffic.

$428

$1,036

$1,597

$1,879

$1,901

$2,430

$3,278

$3,342

$4,822

$145

$243

$210

$1,163

$1,194

$1,470

$1,999

$400

$2,333

$0 $1,000 $2,000 $3,000 $4,000 $5,000 $6,000

Emotional Health

Social Engagement

Diet & Nutrition

Physical Fitness

Aging with Vitality

Emergency Detection


Care Navigation

Vital Sign Monitoring

$Millions

Minimum Revenue

Maximum Revenue

Market Opportunities: Cumulative Revenue Forecasts2013‐2018


RevenueOpportunity Variance*

2.07

1.61

1.59

1.64

1.65

8.36

2.95

4.26

7.61

*Revenue opportunity variance is measured as a ratio of maximum revenue to minimum revenue projections, and is one measure of investment risk. The higher the ratio, the higher the revenue forecast uncertainty.




Growth rate, measured by 5‐year CAGR, is an important measure, but must be considered along with other

evalutation factors. For instance, although the behavioral and emotional health market has the highest 5‐Year

CAGR in our foreasts, this is mainly due to our low 2013 revenue estimates. Nonetheless, a high CAGR usually

indicates an underserved market with low competition. Entrepreneurs with briliant business ideas may launch

a niche solution in this fast‐growing market, and end up maintaining substantial market shares and generating

impressive returns on investment.

Parks Associates contends that total revenue potential, revenue estimate variance, and the potential

number of adopters are the best indicators of an area’s investment attractiveness, thus carrying a higher

weight in our final rankings of the nine areas. A visual illustration of the relative market attractiveness among

the nine areas along these three criteria is presented in Figure 11.

Market Opportunity Comparison The maximum six‐year cumulative revenue opportunity is especially pronounced for vital sign monitoring,

med management & care navigation, while social engagement & aging with vitality are projected to have the

greatest user adoption in 2018. After revenue uncertainties are factored in, the model forecasts a sweet spot

for vital sign monitoring, med management and aging with vitality.

Figure 11: Market Opportunity Comparison




In our final ranking of the nine market opportunities, the size of targeted users and 5‐year CAGR are also taken

into consideration. The results are shown in Figure 12. Our rankings are for comparison purposes, and Parks

Associates strongly recommends investors and entrepreneurs consider all nine opportunities along with

their particular business strengths. Lower ranked opportunities may offer compelling returns if investors

match unique market requirements with their strengths and execute their business plans with speed and

precision.

Figure 12: Market Opportunity Ranking

Market Opportunity Rankings

The target market is that portion of the consumer population that would have an acute need or show strong interest in a particular solution. Adopters are those members of the target market that actually purchase/use the solution.


Opportunity Area RevenueRevenue

Variance

5‐Year

CAGR

Target

Market

Number of

Adopters

Overall

Ranking

Medication Management #3 #3 16% #3 #3 1

Aging with Vitality #5 #1 17% #5 #2 2

Vital Sign Monitoring #1 #5 16% #4 #4 3

Care Navigation Solutions #2 #9 23% #7 #5 4

Emergency Detection & Response #4 #4 25% #9 #9 5

Physical Fitness Solutions #6 #2 23% #6 #8 6

Social Engagement Solutions #8 #7 23% #1 #1 7

Diet & Nutrition Solutions #7 #8 20% #2 #6 8

Behavioral & Emotional Health #9 #6 30% #8 #6 9




6.0 References

6.1 Selected Works Cited

Alzheimer’s Association. 2012 Alzheimer’s Disease Facts and Figures, 2012.

American Psychological Association. Stress in America: Our Health at Risk. January, 2012.

Cacioppo and Patrick. Loneliness: Human Nature and the Need for Social Connection. W. W. Norton &

Company, 2008.

Caprani, Greaney, and Porter. “A Review of Memory Aid Devices for an Ageing Population.” PsychNology

Journal , Vol. 4, No. 3 (2006), pp. 205‐243.

Center for Technology and Aging. “Technologies for Optimizing Medication Use in Older Adults.”

September 2011.

Cheng, Gurland and Maurer. “Self‐Reported Lack of Energy (Anergia) Among Elders in a Multiethnic

Community.” Journal of Gerontology. Vol. 63, No. 7 (2008): pp. 707‐714.

Donini, Savina and Cannella. “Eating habits and appetite control in the elderly: the anorexia of aging.”

International Psyogeriatrics. Vol. 15, No. 1 (March 2003): pp. 73‐87.

Federal Interagency Forum on Aging‐Related Statistics. Older Americans 2012: Key Indicators of Well‐Being.

Washington, D.C.: U.S. Government Printing Office, June 2012.

How, Shih, Lau, and Schchoen. Public Views on U.S. Health System Organization: A Call for New Directions.

2008.

Giles, Glonek, Luszcz and Andrews. “Effect of social networks on 10 year survival in very old Australians:

the Australian longitudinal study of aging.” Journal of Epidemiology and Community Health. Vol. 59 (2005):

pp.574‐579.

Medic Alert Foundation and Alzheimer’s Association. Wandering: Who’s at Risk? 2012.

Peterson, Rhea, Sen, and Gordon. “Resistance exercise for muscular strength in older adults: a meta‐

analysis.” Aging Research Reviews. Vol. 9 (2010): pp. 226‐237.

Pew Internet & American Life Project. Older Adults and Internet Use. June 6, 2012.

Williams and Kemper. “Exploring Interventions to Reduce Cognitive Decline in Aging.” Journal of

Psychosocial Nursing and Mental Health Services. Vol. 48, No. 5 (May 2010): pp. 42‐51.




6.2 Selected Statistical Sources

Centers for Disease Control:

Early Release of Selected Estimates Based on Data from the January‐September 2009 National Health

Interview Survey, March, 2011.

“Diagnosed and Undiagnosed Diabetes in the United States, All Ages, 2010,” 2011 National Diabetes Fact

Sheet, http://www.cdc.gov/diabetes/pubs/estimates11.htm

Health, United States, 2011: With Special Feature on Socioeconomic Status and Health, 2012.

“Injury Episodes and Circumstances: National Health Interview Survey, 1997‐2007.” Vital and Health

Statistics. Series 10, No. 241 (September 2009).

“Nonfatal Bathroom Injuries Among Persons Ages ≥ 15 Years, United States, 2008.” Morbidity and

Mortality Weekly Report. Vol. 60, No. 22 (June 2011); pp. 729‐733.

“Unhealthy Sleep‐Related Behaviors,” Morbidity and Mortality Weekly Report. Vol. 60, No. 08 (March

2011): pp. 233‐238.

Parks Associates:

Managing Care through ACOs: Consumer Interests & Requirements. December, 2012.

Digital Health: Q2 Market Focus, Online Health Service. 2012.

Digital Health: Q1 Market Focus, Multiple Medication Management and Smart Pill Boxes. 2012.

IP‐Based Health Solutions: Home Care & Beyond, November, 2011.

Personal Health Tools and Applications. 2010.

U.S. Census Bureau:

Statistical Abstract of the United States. 2012.

American Community Survey. 2011.

Current Population Survey: Annual Social and Economic Supplement. 2010.




Appendix A: Population Data

Figure 13: U.S. Population by Age and Sex, 2010

Figure 14: U.S. 50+ Population Forecast, 2011‐ 2018

Total Population Male Female

All Ages 308,745,538 151,781,326 156,964,212

Under 5 years 20,201,362 10,319,427 9,881,935

5 to 9 years 20,348,657 10,389,638 9,959,019

10 to 14 years 20,677,194 10,579,862 10,097,332

15 to 19 years 22,040,343 11,303,666 10,736,677

20 to 24 years 21,585,999 11,014,176 10,571,823

25 to 29 years 21,101,849 10,635,591 10,466,258

30 to 34 years 19,962,099 9,996,500 9,965,599

35 to 39 years 20,179,642 10,042,022 10,137,620

40 to 44 years 20,890,964 10,393,977 10,496,987

45 to 49 years 22,708,591 11,209,085 11,499,506

50 to 54 years 22,298,125 10,933,274 11,364,851

55 to 59 years 19,664,805 9,523,648 10,141,157

60 to 64 years 16,817,924 8,077,500 8,740,424

65 to 69 years 12,435,263 5,852,547 6,582,716

70 to 74 years 9,278,166 4,243,972 5,034,194

75 to 79 years 7,317,795 3,182,388 4,135,407

80 to 84 years 5,743,327 2,294,374 3,448,953

85 to 89 years 3,620,459 1,273,867 2,346,592

90 to 94 years 1,448,366 424,387 1,023,979

95 to 99 years 371,244 82,263 288,981

100 years+ 53,364 9,162 44,202

U.S. Population by Age and Sex, 2010

Source: U.S. Census Bureau, "Table 2. Population by Age and Sex: 2000 and

2010", 2010 Census Briefs, Age and Sex Composition: 2010 (May 2011)

Unit 2011 2012 2013 2014 2015 2016 2017 2018

People 50‐64 #M 59.0 59.7 60.6 61.4 62.4 63.4 64.4 65.5

Growth % 1.3% 1.4% 1.5% 1.6% 1.6% 1.7% 1.7%

People 65+ #M 40.4 41.2 42.1 43.0 44.0 45.1 46.3 47.7

Growth % 2.0% 2.1% 2.2% 2.3% 2.5% 2.7% 3.1%

Total People 50+ #M 99.4 100.9 102.6 104.4 106.4 108.5 110.7 113.2

Growth % 1.6% 1.7% 1.8% 1.9% 2.0% 2.1% 2.3%

U.S. 50+ Population Forecast, 2011 ‐ 2018

Source: Parks Associates, 2012.




Appendix B: Parks Associates’ Data Highlighting 50+ Market

Technology Attitudes and Adoption

Figure 15: Mobile Phone Ownership, by Age

5%

5%

6%

10%

13%

10%

20%

19%

32%

41%

50%

62%

74%

76%

62%

49%

37%

29%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

18‐24 (n=386, ±4.99%)

25‐34

(n=531, ±4.25%)

35‐44

(n=542, ±4.21%)

45‐54(n=508, ±4.35%)

55‐64

(n=330, ±5.39%)

65 and Older

(n=203, ±6.88%)

% Indicating Phone Ownership

Do not own phone Own basic/feature phone Own smartphone

Mobile Phone Ownership, by Age (Q4/12)"Q2033. Which type of mobile phone do you personally use?"

(Among U.S. Broadband Households, by Age)

Source: Managing Care ThroughACOs: Consumers Interests & Requirements© Parks Associates, 2012.




Figure 16: Attitudes Towards Technology, by Age

26%

35%

47%

31%

40%

47%

24%

32%

35%

21%

29%28%

14%

17%

22%

13%11%

19%

0%

10%

20%

30%

40%

50%

I value technology, which makes our life/work easier, but I personally don’t

like technology

I truly enjoy technology and would like to purchase the latest technology

products, even though they are always expensive

I heavily use apps on the smartphone for daily information and entertainment purposes

(Among Smartphone Owners)

% Highly Agree with Statement

(i.e., Rating 6‐7 on a 7‐pt. Scale)

18‐24 (n=386, ±4.99%)

25‐34(n=531, ±4.25%)

35‐44(n=542, ±4.21%)

45‐54(n=508, ±4.35%)

55‐64(n=330, ±5.39%)

65 and Older(n=203, ±6.88%)

Attitudes Towards Technology, by Age(Q4/12)"DT1001. Please indicate your level of agreement with the following statement about your attitudes to technology."

(Among U.S. Broadband Households, by Age)

Source: Managing Care ThroughACOs: Consumers Interests & Requirements © Parks Associates, 2012.




Figure 17: Consumer Use of Top Web Services, by Age

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

18‐24

(n=352, ±5.22%)

25‐34

(n=461, ±4.56%)

35‐44

(n=543, ±4.21%)

45‐54

(n=568, ±4.11%)

55‐64

(n=384, ±5%)

65+

(n=209, ±6.78%)

% Using W

ebsite W

eekly or Daily

Google

Facebook

Yahoo

YouTube

Twitter

Use of Top Web Services, by Age (Q4/12)"Q9005. How often do you use the following websites?"

(Among Consumers Ages 50 and Older Living in Broadband Households )

Source: March 2012 Survey© Parks Associates, 2012.




Diet & Exercise

Figure 18: Healthy Living Behaviors Among 50+

11%

16%

26%

26%

27%

33%

34%

42%

53%

71%

79%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90%

Buy organic food

When eating out, check calories of the foods ordered

Eat fast food

Drink alcohol

Use tobacco products

Exercise indoors (aerobics, yoga, pilates, etc.)

Exercise outdoors (jogging, biking, hiking, etc.)

Weigh yourself

When shopping, check food labels for ingredients and calories

Take vitamins or supplements

Eat fresh fruits/vegetables

% Engaging in Activity Weekly or Daily

Healthy Living Behaviors Among 50+ (Q4/12)"Q4035. How frequently do you...?"

(Among Consumers Ages 50 and Older Living in Broadband Households, n=819, ±3.42%)






Figure 19: Number of Prescribed Medication Taken, by Age

22% 20% 17% 18%13% 13%

8% 10%12% 13%

15% 14%

6% 8%15%

26%

42%

60%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

18‐24

(n=1400, ±2.62%)

25‐34

(n=2140, ±2.12%)

35‐44

(n=2240, ±2.07%)

45‐54

(n=2040, ±2.17%)

55‐64

(n=1240, ±2.78%)

65 and older

(n=840, ±3.38%)

% Taking Specifying Number of Medications

3 or more

2

1

Number of Prescribed Medications Taken by Age (Q1/12)"Q4010. How many prescription medications do you currently take on a regular basis?"

"Q1000. In what year were you born?"(Among Specified Age Groups)

Source: Multiple Medication Management and Smart Pill Boxes© Parks Associates, 2012.




Figure 20: Challenges Taking Multiple Medications

0%

2%

4%

6%

8%

10%

12%

18‐24

(n=1400, ±2.62%)

25‐34

(n=2140, ±2.12%)

35‐44

(n=2240, ±2.07%)

45‐54

(n=2040, ±2.17%)

55‐64

(n=1240, ±2.78%)

65 and older

(n=840, ±3.38%)

% Specifying Challenges

(As % of A

ll Households)

Forget to take the medications

Run out of medications because you forgot to refill the prescriptionRefilling prescriptions is complicated

Uncertain about the medication’s side‐effects

Challenges with Taking Multiple Medications as % of All Households (Q1/12)"Q4011.Which of the following challenges have you had with your medications?"

"Q1000. In what year were you born?"(Among Specified Age Groups)

Source: Multiple Medication Management and Smart Pill Boxes© Parks Associates, 2012.




Medical Conditions and Vital Sign Monitoring

Figure 21: Prevalence of Health Conditions, Among 50+

28%

1%

5%

7%

7%

9%

12%

12%

13%

16%

18%

36%

40%

0% 10% 20% 30% 40% 50%

None of the above

Type I Diabetes

Arrhythmia (irregular heart beat)

Heart disease (excluding Arrhythmia)

COPD (Chronic Obstructive Pulmonary Disease)

Asthma

Obesity (BMI over 30)

Clinical depression (on depression medication)

Sleep disorder (Sleep Apnea, Chronic insomnia, etc.)

Type II Diabetes

Overweight (BMI over 25 but below 30)

Abnormal blood pressure (too high or too low)

High cholesterol level

% With Specified Condition

Prevelance of Health Conditions Among 50+ (Q4/12)"Q4025. Do you have any of the following conditions?"

(Among Consumers Ages 50 and Older Living in Broadband Households, n=819, ±3.42%)





Figure 22: Health Device Ownership, Among 50+

1%

2%

3%

3%

13%

17%

16%

35%

35%

1%

1%

3%

13%

11%

20%

23%

33%

61%

0% 10% 20% 30% 40% 50% 60% 70%

A digital pill box with reminder function

Medical alert button/pendant

Heart rate watch

Digital hearing aid

Digital pedometer

Large fitness equipment

Glucometer

Digital weight scale

Blood Pressure Meter

% Using Specified Device

65 and Older (n=203, ±6.88%)

Ages 50‐64 (n=616, ±3.95%)

Health Device Ownership, Among 50+ (Q4/12)"Q4005. Which of the following healthcare products do you or any family member in your household use?"

(Among Consumers Ages 50 and Older Living in Broadband Households)





Figure 23: Van Westendorp Pricing Analysis for Fall Detection Program

$1 $5 $10 $15 $20 $25 $30 $35 $40 $45 $500%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

% specifying price point

Good value

Too cheap

Getting expensive

Too expensive

A Fall Detection Program Price Point: Van Westendorp Model (Q2/10)(Among Respondents Interested in Paying for Service for Seniors, n=156, ±7.85%)

OPP: $23

PMC: $17

PME: $30

The model suggests that a good price range for a fall detection service is

between $17 and $30.




Figure 24: Van Westendorp Pricing Analysis for Medication Management Program

$0 $5 $10 $15 $20 $25 $30 $35 $40 $45 $500%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


Good value

Too cheap

Getting expensive

Too expensive

A Medication Management/Reminder Service Price Point: Van Westendorp Model (Q2/10)

(Among Respondents Interested in Paying for Service for Seniors, n=113, ±9.22%)

OPP: $23

PMC: $17PME: $30

The model suggests that a good price range for a medication

management/reminder service is also

between $17 and $30.




Figure 25: Van Westendorp Pricing Analysis for Home Health Monitoring Program

$0 $5 $10 $15 $20 $25 $30 $35 $40 $45 $50 $55 $60 $650%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


Good Value Too Cheap

Getting Expensive Too Expensive

Home Health Monitoring Service Price Point: Van Westendorp Model (Q2/10)

(Among Respondents Likely to Pay for Service, n=610)

OPP: $17

PMC: $14

PME: $26

Using the Van Westendorp Model, the optimal price is around $17/month and a good price range is between $14 and $26.




Navigating the Care Experience

Figure 26: Satisfaction with Hospital Experience, Among 50+

53%

53%

56%

57%

57%

61%

59%

59%

63%

62%

64%

67%

68%

72%

0% 20% 40% 60% 80%

Follow‐up service after patient was discharged

Hospital admission process

Communication with your primary care doctor(about your treatment)

Communication with doctors and nurses from hospital

Overall patient experience of the transitionfrom hospital to home

Information/instructions provided at discharge

Responsiveness of hospital staff

% Very Satisfied with Experience (i.e., Rating 6‐7 on a 7‐pt. Scale)

65 and Older

Ages 50‐64

Satisfactionwith Hospital Experience, Among 50+ (Q4/12)"Q4205. How satisfied were you with the following aspects of most recent hospital service visit?"

(Among Consumers Ages 50 and Older Living in Broadband Households Who Were Recently Hospitalized)


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