Healthcare purchasers are increasingly linking digital health payments to measurable performance, as employers, health plans and health systems seek greater evidence of clinical and financial impact from technology vendors.
The Peterson Health Technology Institute (PHTI) surveyed 321 U.S. digital health purchasing decision-makers, including 106 health plans, 115 employers and 100 health systems. Overall, 57% reported using performance- or risk-based contracts, including 68% of employers, 55% of health plans and 46% of health systems.
Financial exposure is also substantial. Among organizations using performance-based agreements, 85% put at least 25% of contract value at risk, while 31% place more than half at risk. However, purchasers continue to face challenges verifying whether vendors achieve contracted targets.
Forty-five percent identified difficulties integrating vendor information with claims or utilization data, while 42% cited proprietary measurement methodologies. Another 40% said vendors sometimes report results using highly engaged subpopulations rather than the entire eligible population. Financial savings were the most frequently missed contractual metric, with 27% reporting vendors failed to meet those targets.
Member engagement remains another concern. Forty-seven percent of purchasers said fewer than 25% of eligible members enroll in contracted digital health programs. Buyers are consequently moving beyond registration as their primary engagement measure, increasingly assessing active platform usage and completion of clinical milestones.
Purchasing strategies are also becoming more selective. While 56% expect digital health spending to remain stable over the next 12 months, only 9% now offer 11 or more individual digital health solutions, compared with 23% in 2025. Diabetes, primary and chronic care, and mental health remain major contracting areas.
“Across both Medicare and the commercial market, payment for technology-driven chronic care management should be directly tied to clinical outcomes,” said Caroline Pearson, executive director of PHTI. “While the industry is broadly aligned on this approach, employers and health plans still struggle to negotiate and adjudicate these contracts, which often depend on vendors to report clinical and financial data. Easing these administrative challenges is essential to driving broader adoption of performance-based contracts. Over time, these contracts can actually generate more data about how vendors perform and help build confidence in digital health solutions.”
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