Apple is poised to enter the health insurance business in 2024 in partnership with a major payer, according to an industry analyst.
“They are in such a strong position to do this,” Ben Wood, chief analyst at CCS Insight, told Forbes. “They’ve got a wealth of personal health data through Apple Watch. If they join some of the dots together, they can become a very competitive health insurance player, and that potentially is going to have quite an impact on the structure of the healthcare market in the United States.”
Wood predicts the tech giant will power the new offering through health data collected by Apple Watches, such as blood pressure, blood oxygen levels, ECG readings and body temperature. With accompanying devices, the Watch and iPhone also can be used to monitor conditions such as diabetes. Having access to this data gives the company an advantage in entering the market and cutting costs.
Such a move would raise questions over whether Apple launched the Watch with the long-term goal of entering the lucrative health insurance market, Wood said. He doesn’t believe the Watch was launched with that ambition in mind but that Apple now views it as a means to enhance its services businesses.
“(Apple CEO) Tim Cook pivoted Watch into the health and fitness space, and they hit an area that just resonated with consumers,” he said. ”I don’t think it was a Trojan horse to get into this, I just think it’s been a natural evolution. All of a sudden, they look at the data that they’ve got and they say, ‘should we go into the healthcare industry?’”
A shift into health insurance would add further impetus to Apple’s already booming services business. Services already are generating around $20 billion a quarter, and CCS Insight believes that will only continue to grow. Analysts predict that by 2030, a third of Apple’s revenue will come from software and services. It currently represents just less than a quarter of the business.