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“My biggest concern is that lots of companies in this space, and even traditional healthcare companies that are transitioning to become a hybrid model, whereby they have some patients that are demanding some services be done electronically, they’re probably acutely unaware of the potential risks and exposures that they’re sleepwalking into,” Boyce said.

 “[Or they may be] potentially unaware that their traditional medical malpractice policy they’ve had for many, many years has now become slightly insufficient, because it isn’t now considering or determining all of these different threats that they’re potentially opening themselves up to.”

Boyce called for a “rethink and refresh” around the risks affecting healthcare businesses in 2022 and beyond, and what insurance needs to offer.

“Historically, we roughly know what the risks and exposures are when we know where the claims are going to emanate from, but the moment you layer in different types of technology to potentially diagnose patient conditions using AI, or if they’re offering a video consultation and they haven’t picked up on something, or they give a misdiagnosis – because they’ve been using technology to diagnose cancerous lesions – it can be really problematic,” Boyce said.

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Telemedicine, or virtual appointments, has become commonplace in global healthcare settings, with its use buoyed by COVID-19 pandemic restrictions and consumer choice – the pandemic “probably fast forwarded the adoption of telehealth solutions by about 10 years,” according to Boyce.

The telehealth sector has continued to dominate CFC’s digital healthcare book, accounting for 53% of its portfolio in 2021.

In the UK, 99% of general practitioners now have access to video consultations, up from fewer than 10% in February 2020 before the country’s first COVID lockdown.

At least $17.8 billion has been raised by Canadian healthcare start-ups, according to PWC, with digital healthcare spending expected to more than double by 2030 and much interest focused on telehealth and virtual care services.

“The pandemic was a catalyst but not the sole driver for growth; we’re under no illusions that the pandemic has obviously helped – the fact that it showed telehealth in a completely different light,” Boyce said.

Global telehealth use settled at around 38 times higher than pre-pandemic, a July 2021 McKinsey study found.

Attitudes have changed to the tool since it became more commonplace and medical providers are expected to look to a hybrid model in the coming years.

“There was a lot of people that were hugely against it because they thought that there were huge limitations around telehealth – you couldn’t physically touch and feel the patient and, therefore, you probably couldn’t potentially give them the right diagnosis,” Boyce said.

“But what the pandemic has definitely shown is that actually, these sort of thoughts and comments that people had previously have been very much nullified – there hasn’t been a huge uptick in in misdiagnosis as a result of telehealth.”

Other emerging technologies being used by healthcare organisations include mobile health, remote patient monitoring solutions, and online fitness.

AI – representing just 4% of the MGA’s portfolio as of 2021 – has seen 32% growth, according to CFC.

The technology is being used in chatbots, which can help determine whether someone needs a face-to-face appointment, as well as increasingly in diagnostics, for example to analyse CT scans – the technology can analyse up to 20,000 images in a matter of minutes, according to Boyce.

“The [AI tools] that become more challenging are the ones that are a little bit more like a black box that are making diagnostic decisions direct to patients, as opposed to it being used as a secondary tool, and those are the most concerning areas for us,” Boyce said.

“Not all forms of AI are the same and often you don’t exactly know why the algorithm made that decision.”

Organisations must also deal with a regulation challenge where it comes to AI and telehealth as governments and regulators grapple with what good practice looks like and whether to keep deregulation that came in under COVID.

Intellectual property claims have also proved a challenge for digital healthcare businesses, and around 18% of CFC’s claims in the segment have stemmed from IP issues.

“There’s an absence of legal clarity around whether some forms of AI would be considered intellectual property, so an algorithm which was created by one party – if that potential developer leaves and goes to another organisation, and they create an algorithm that is very similar to it, have they breached their potential IP?” Boyce said.

“A lot of it is concerning because there’s very little in the way of affirmative coverage in any healthcare policy – any medical malpractice policy, you just wouldn’t see coverage for it.”

Read more: CFC builds London market healthcare insurance unit

CFC debuted its digital healthcare practice in the US five years ago and has seen growth across other markets since widening its reach.

Overall, the US accounted for 81% of its book in 2021, from 92% in 2019.

Canadian insureds’ proportion within the business grew from 2% in 2019, to 5% in 2021, with the UK swelling from 5% to 10% over the same period.

“In Canada, we’ve seen slightly slower adoption rates on the basis that it took a little bit of time to get government buy in, and that’s the same with the UK as well,” Boyce said. “They have relatively similar healthcare payer systems whereby in the UK, we have the NHS [National Health Service] but we’ve also got a private system.”


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