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2022 Health Tech Investment Predictions Span Enterprise, Insurtech, and Retail Sectors

Analysis  |  By Laura Beerman  
   January 13, 2022

'While nontraditional venture investors have pulled back investment activity in the past … incumbents and their corporate venture capital (CVC) units have remained committed.—PitchBook 2022 Emerging Technology Outlook

In its 2022 Emerging Technology Outlook, PitchBook made three major predictions for healthcare technology investment, spanning enterprise tech, insurtech, and retail health tech. While venture capital (VC) firms are still the primary funders of the healthcare startups, the company notes that healthtech VC deal activity "has spiked" and is expected to grow to $1.3 trillion by 2025—due in part to payer- and other healthcare stakeholder-led investments in the areas noted below. Within PitchBook's predictions are important caveats discussed at this article's end, the cautionary tales that inevitably and necessarily shadow innovation headlines.

Top three healthcare predictions

1. Precision and personalized medicine to receive record funding.

The right mix and maturity of supporting technologies, market drivers, and opportunities may make 2022 a significant year for precision and personalized medicine. The intersection of the two is but one example of enterprise heath tech, which PitchBook defines as B2B services that focus on improving care quality while decreasing cost of care. Enterprise health tech is divided into five categories:

  • Prescription tech
  • Customer acquisition tools
  • Clinical trial tech
  • Insurance tech (insurtech)
  • Operations and care management

While noting that "precision medicine has been a talking point for several years" and that "it may yet take several years to become fully commercialized," PitchBook's Outlook adds that "we expect VC interest to ramp up."

Payer-driven VC companies are among the investors in health tech. UPMC Enterprises for example, the venture capital arm of payer-provider UPMC, was a co-lead investor in a $20 million funding round for Smile CDR, a data and platform company focused on increasing interoperability for payers and providers.

This is increasingly possible, adds PitchBook, through a "confluence of technologies" that range from sensors and remote monitoring to EHRs and genetic databases. The caveat, however, that the very capabilities that fuel growth are enmeshed with the "medicolegal" issues that may slow its growth, including ongoing issues related to data privacy and security.

2. Insurtech to see more M&A, driven by established players.

PitchBook expects established payers to continue acquiring startup insurtech competitors, many of whom are advanced tech native from inception and offer incumbents the opportunity to buy the innovations they lack in-house. Insurtech companies have disrupted the market, offering plan comparison and enrollment platforms in addition to new coverage options. Devoted Health and Clever Care Health Plan are examples of the latter, attracting two of the largest insurtech investments ($1.2 billion and $71 million, respectively) as 2021 drew to a close.

Insurtech is another area where traditional payers are escalating market investment through mergers and acquisitions (M&A). According to PitchBook: "While nontraditional venture investors have pulled back investment activity in the past, especially during volatile market conditions or downturns, incumbents and their corporate venture capital (CVC) units have remained committed to insurtech investments in recent years." That commitment totaled $2.7 billion in 2021, nearly double 2020 figures. Optum Ventures, the VC enterprise of UnitedHealth Group, is one of the largest players in this space.

3. Retail health tech seeks to disrupt entrenched approaches.

Like precision medicine, retail health is another area whose growth has been slower to materialize than eager analysts predicted nearly two decades ago. But as with so many facets of healthcare since COVID-19, telehealth, "[n]ew technologies and the proliferation of mobile devices have enhanced providers’ ability to provide care via video chats and chatbots." PitchBook predicts that "[r]etail healthtech startups will increasingly focus on building technology that increases the frequency of low-touch interactions between patients and providers." This may occur virtually or in person.

Existing players are seeking the same outcomes, through a proliferation of virtual-first health plans and, for CVS Health-Aetna, a deepening integration that makes CVS MinuteClinics and HealthHUBs central to more plan designs.

The interplay of caution and innovation

PitchBook balances its predictions with important counterarguments that demonstrate what payers and other investors already know: that success is never guaranteed. Traditional healthcare practices continue to vex innovation. These include the:

  • "technical, ethical, and legal" concerns that remain as data, analytics, and interoperability advance.
  • "increased competition, evolving risks, and heightened customer expectations" that can make insurtech investments high risk.
  • long-standing workflows, interaction patterns, delivery mechanisms, and fee-for-service reimbursement that are deeply entrenched.

On this latter point, PitchBook identifies "one of largest obstacles facing the industry … how to shift the interaction patterns between providers and patients."

Laura Beerman is a contributing writer for HealthLeaders.


Noting that payers continue to join the ranks of startup investors, PitchBook has made 2022 predictions related to emerging healthcare technology.

Market watch areas include the potential for record-breaking precision medicine investment, continued acquisition of new insurers by established companies, and for the growth of retail-based, low-touch services.

These predictions will depend upon the ability of investors, including traditional stakeholders, to innovate aspects of healthcare that have been resistant to disruption.

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