How the Apple Watch Supports Apple’s Growth as a Healthcare Power

At Apple’s September 12 Special Event, the company continued to show off its growing healthcare superpowers with the release of the Apple Watch Series 4. The latest iteration of the Apple Watch, available September 21, unleashes new features designed to help people manage wellness. Those features include:

• Creation of an ECG similar to a single-lead electrocardiogram. Using a new ECG app, watch owners can take an ECG reading from their wrists and receive heart rhythm classifications. The Apple Watch can classify if the heart is beating in a normal pattern or whether there are signs of Atrial Fibrillation (AFib). In addition, the data is stored in Apple’s Health app in a PDF that can be shared with physicians. In Apple’s words, “It’s a momentous achievement for a wearable device that can provide critical real-time data for doctors and peace of mind for you.”
• The ability to detect when a person falls and report a falling incident to a designated emergency contact. Analyzing wrist trajectory and impact acceleration, the Apple Watch sends the user an alert after a fall, which can be dismissed or used to initiate a call to emergency services. If the Apple Watch senses immobility for 60 seconds after the notification, it will automatically call emergency services and send a message along with location to emergency contacts.
• More fitness features. The Apple Watch already gamifies healthcare by rewarding users with special badges for completing fitness tasks such as walking. Now the Apple Watch allows users to challenge other Apple Watch wearers to complete fitness tasks. In addition, the device provides other features such as prompting owners to start workouts and accurately tracking active calories burned for activities such as hiking and yoga.

With the Apple Watch Series 4, Apple extends its reach into healthcare, following a strategy that the company has been pursuing for years.

The Data Backbone for Patient Care

As I discussed in my 2017 report Dr. Apple Will See You Now, Apple has been developing tools such as the Health app and working with medical centers such as Johns Hopkins to help patients manage their wellness and clinical care — including heart monitoring, managing epilepsy, and many other health needs and issues. I believe Apple aspires to be the data backbone for patient care. That strategy has three key elements:

• Software for patients and providers to monitor and share data, which is where apps come into play.
• Hardware: the Apple Watch and iPhone to create an ever-present device platform.
• Relationships with healthcare providers such as hospitals to monitor and share wellness data.

Apple’s penetration of healthcare supports its growth in both wearables and services, two categories that, while small, are contributing more to Apple’s revenue growth based on its earnings results. Here’s how CEO Tim Cook described healthcare in a Fortune interview: “We’re extremely interested in this area. And, yes, it is a business opportunity. If you look at it, medical health activity is the largest or second-largest component of the economy, depending on which country in the world you’re dealing with.”

The focus on wellness care in particular positions Apple well. The PwC’s Health Research Institute (HRI) cites wellness care as one of the top forces shaping the future of healthcare industry, with wellness accounting for $276 billion of the $5 trillion U.S. healthcare ecosystem.

Healthcare Partnerships — and Cause for Worry

So far, Apple has partnered effectively with healthcare providers. For example, in 2017, Apple announced that it was working with Stanford Medical Center to determine whether the Apple Watch can accurately detect abnormal heart rhythms, or arrhythmias. And Apple’s ability to give people more control over their health records via their Apple devices relies on cooperation with medical providers.

But the ECG feature in the Apple Watch 4 has some healthcare providers worried. As reported in MarketWatch, doctors (especially cardiologists) are worried that users may not understand the ECG readings and may in fact overreact to them:

There are scenarios in which information recorded by the watch could be helpful for medical professionals, experts said. But they also voiced serious concerns about whether the watch could correctly point to atrial fibrillation, something that can be tricky to diagnose, and that users would have trouble knowing what to do with the data the watch gathers, since the heart isn’t a subject that’s well understood by most people.

In other words, a little learning could be dangerous.

On the other hand, the FDA did clear the Series 4 (the only smartwatch to achieve FDA clearance). And the American Heart Association (AHA) supports the Series 4’s new heart rate features, as witnessed by an appearance at Apple’s Special Event from AHA President Ivor Benjamin.

According to IDC analyst Ramon Llamas, “Getting FDA approval is by no means an insignificant step. The standards are extremely high and the margin for error is likewise slim, so congratulations are in order for Apple to get approval for the Series 4. Of course, if you look at the history of Apple’s partnerships and acquisitions, it was really only a matter of time for this to come together.”

Whether the ECG sensor creates a spike in false positive reports and needless visits to the doctor remains to be seen. The reaction of physicians, though, is a reminder that Apple still has much work to do in order to execute on its strategy to shape the future of healthcare.

The Big Picture Looks Impressive

At the same time, the big picture looks impressive: Apple is silencing its skeptics who questioned whether the world needed another wearable device. Now we know Apple was doing much more than launch a wearable with it released the Apple Watch in 2015: the company was putting in place a key element of Apple’s healthcare growth strategy. And there is no stopping Apple now.

These blog posts provide more insight into Apple’s healthcare aspirations as well as the growth of the Apple Watch:

• “Apple Wants to Liberate Your Medical Records,” January 28, 2018.
• “Apple Extends Its Reach into Healthcare,” September 13, 2017.
• “How the Apple Watch May Simplify Your Next Doctor’s Visit,” March 13, 2017.
• “ Apple Will See You Now,” February 24, 2017.
• “Apple Watch: Hot or Not?” December 15, 2015.
• “Apple and Disney Launch and Learn with Wearables,” May 17, 2015.