The New Battlefield of Mobile Health: From Solo Operations to Strategic Alliances

Since its inception, mobile health has remained a focal point within the industry. Particularly amid the “Internet Plus” boom, tech giants have also ventured into the mobile health sector. Despite criticisms of aggressive market grabbing, mobile health has undoubtedly captured widespread attention.

Successive rounds of increasingly large financing, coupled with strategic planning for the future of healthcare, have propelled mobile health into the spotlight. Every stage of the diagnostic and treatment process, starting from appointment registration, seems to hold countless possibilities for the future of mobile health. For some time now, mobile health platforms have provided services such as appointment registration, scheduling, and payment processing, while also offering greater convenience in the realm of light consultations. The wave of “Internet Plus” has significantly boosted the popularity of mobile health: currently, there are over 2,000 mobile health apps in China, and the market size of China’s mobile health sector is projected to reach RMB 12.53 billion in 2017.

However, upon closer examination, it is currently difficult for a single app to dominate the market or even go public directly. Many services currently branded as mHealth are actually integrated solutions, comprising mHealth modules, online portal modules, database modules, call centers, and even personal family physicians.

Beyond experiencing explosive growth, mobile healthcare has now transitioned from an era of isolated operations to one of collaborative engagement, aiming to capture a larger share of the market. Alibaba has integrated its pharmaceutical e-commerce operations by transferring the operational rights of Tmall’s online pharmaceutical business to Ali Health. Internationally, Apple and IBM have partnered with Johnson & Johnson, one of the world’s largest medical device manufacturers, to provide physicians and insurers with access to Apple Watch health data, thereby positioning themselves in the medical big data market. Analysts point out that traditional publicly listed healthcare companies are moving beyond competition for entry-point platforms and taking further steps toward strategic alliances between industry leaders and cross-sector integration.

# Strong Alliance: Integration of Online and Offline Channels

The advantage of investment by internet companies lies in their robust platforms, which can directly channel user traffic. This reflects a typical traffic-driven mindset. However, healthcare differs from other internet products that monetize through technology or advertising, and individuals cannot serve as the primary payers. The core of healthcare remains service delivery, whereas the greatest limitation of the internet mindset is the lack of offline services. Therefore, healthcare O2O (Online-to-Offline), which integrates services, will represent the most significant opportunity in mobile health.

In terms of online-to-offline (O2O) integration, Wei Wenzhen recently announced a partnership with Sudiyi, China’s largest provider of 24-hour express delivery pickup services. According to reports, Sudiyi and Wei Wenzhen have signed a strategic agreement to establish a strategic partnership. Moving forward, both parties will fully leverage their respective advantageous resources to engage in comprehensive, deep collaboration in areas such as lifestyle services, medical consultations, and brand promotion, thereby building a tightly integrated O2O alliance.

The popularity of the O2O model in the internet era, the diversion of customers from traditional physical outlets, the release of demand for smart community health lifestyles, and the inevitable trend of mobile healthcare integrating with offline services all form the basis for cooperation between the two parties. On one hand, for Sudiyi, building a comprehensive platform integrating health, finance, logistics, and other functions represents a further upgrade. On the other hand, for Wei Wenzhen, relying on Sudiyi’s robust multi-dimensional offline community traffic entry points and its ongoing efforts to build a mass entrepreneurship and innovation-sharing platform that aggregates corporate resources provides traffic support and customer resources for the future growth of the “Wei Wenzhen” platform.

Wei Wenzhen has chosen to partner with Sudiyi to bridge the “online + offline” divide, thereby facilitating the creation of a complete O2O closed-loop service chain spanning online consultations, medication purchasing and delivery, and health management. This collaboration also enables precise matching among doctors/pharmacists, users, and medications, thus promoting the rational allocation and shared utilization of users and medical resources to a certain extent.

Relaxed Policies on Physicians’ Multi-Site Practice: A Collective Push

As policies on physicians’ multi-site practice have been relaxed, physician groups have sprung up like mushrooms after rain, with talented professionals showcasing their expertise and actively exploring business models suited to their needs. A review of dozens of physician groups, both within and outside the public healthcare system, reveals four predominant business models: “physician-led,” “tiered diagnosis and treatment within the public system,” “platform-based,” and “management service organization.”

The PHP model, or Physician-Hospital Partnership, has been implemented in the United States for many years and gained prominence in China through the introduction by Dr. Zhang Qiang’s Doctor Group. At its core, this model places physicians in a leading role, where physician teams enter into cooperative agreements with hospitals to generate revenue through service fee sharing or insurance reimbursements. These physician-led groups are typically specialty-focused, and their members have largely left the traditional public healthcare system. Prominent examples include Dr. Zhang Qiang’s Doctor Group and Wanfeng Doctor Group.

In contrast to the US-originated Physician-Hospital Partnership (PHP) model, the tiered diagnosis and treatment system within China’s public healthcare framework exhibits distinct “Chinese characteristics.” Its core tenet is that physicians remain employed within the public system while engaging in multi-site practice outside their regular eight-hour workdays. By leveraging physicians as links between tertiary hospitals and primary care institutions, this model facilitates tiered diagnosis and treatment and promotes the redistribution of medical expertise from large hospitals to grassroots facilities. Physicians’ income is derived from the incremental revenue generated by the medical services they provide. The “Dajia Medical Alliance” serves as a typical example of this approach.

Platform-based physician groups represent a proactive application of internet thinking in the healthcare sector. Their core premise lies in diminishing the traditional role of hospitals by establishing platforms that facilitate direct communication between physicians and patients. Leveraging mobile internet technologies, these groups enable cross-regional, cross-institutional, and cross-departmental collaboration, thereby providing services to patients across China at any time. Physicians generate income through service provision, while the group charges management fees. Prominent examples include WeDoctor Group (under Guahao.com), Xingxiangyuan Physician Group, and Health Micro Energy.

As a business entity or association, a physician group inevitably relies on operations and management. However, the core leaders of physician groups are mostly physicians with formal medical training, who often find themselves struggling with managerial responsibilities. Consequently, a “group of physician groups” has emerged to address this need. This entity does not engage in specific clinical activities; instead, it operates as a fee-for-service organization that provides professional management expertise, including operational management and legal support for physician groups. It boasts specialized services and cost-control capabilities, generating revenue through franchise fees and management fees. Physicians can enter into contracts with such management service organizations. The China-Europe Physician Group is a typical example.

Underlying Drivers of the Mobile Health Integration Trend

As mobile healthcare has evolved, the trend toward integration has become unmistakable. On the user side, regardless of which app is chosen, data can be consolidated and managed through a single large-scale platform. This implies that many apps from smaller vendors will disappear, with integration into major platforms becoming an industry trend. Although hardware options may remain diverse, backend data processing and services are likely to become increasingly centralized.

The advantages of centralized integration in such apps are clearly evident, primarily in two aspects. First, user convenience is significantly enhanced, which also facilitates the further dissemination of the product. Social platforms similar to WeChat, with their private messaging, friend-to-friend sharing, and commenting features, are highly conducive to the viral spread of mobile health products. These features also help foster a mobile health community, thereby increasing user stickiness.

Secondly, the centralization of data facilitates analysis and application. Currently, there is an abundance of consumer-side mobile health data in the market, but it is fragmented and discontinuous, which hinders its effective utilization. The data integration enabled by platforms holds positive significance for the entire industry. Such integration helps unify data, as only continuous data streams possess analytical value. Although China’s analysis and application of big data in mobile health are still in the exploratory stage, and interpreting data correctly remains a challenge, data consolidation is conducive to helping the industry chart a course for leveraging big data applications.

By Lu Bei | Graduated from Northwest University. Formerly engaged in clinical medicine, now outside the public healthcare system, focusing on mobile health communication analysis and healthcare reform practice