IT Entrepreneurs Rush Into Healthcare, But Will Human Touch Be Missing?

A new health IT firm called Omada Health, which recently secured $23 million in startup financing, is working with people at risk of developing diabetes to help them head off the full-blown condition. The company's executives say they can achieve better results through electronic-service delivery than other providers have gotten through traditional face-to-face encounters.

San Francisco-based Omada, founded in 2011, has its clients interact online with a personal coach and a peer group who try to influence the clients to reduce their weight. The program combines use of online chat rooms and lessons, phone calls and remote electronic monitoring. Weight loss is checked by a digital scale, which electronically transmits the data to Omada staff. Customers are either screened through a questionnaire or by a blood test to confirm prediabetic status.

Mike Payne, the company's chief commercial officer and head of medical affairs, said Omada's model can be disseminated more widely than bricks-and-mortar programs, is more flexible for participants and enables better data-based decisions.  The vision of providing better, faster, cheaper and more consumer-friendly healthcare is shared by many digital health and telehealth startups. Such health IT companies have received $2.3 billion in investment money the first half of this year, according to a report from digital health accelerator Rock Health...