In highly regulated industries such as health care and financial services, the difference between evolutionary and revolutionary transformation usually boils down to the pace of change and the level of disruption that results. The shift towards a more patient-centric model for health care and employee benefits, while hardly new, comes at a pace and magnitude of change that makes the evolutionary feel like something bordering on the revolutionary.

Nearly two decades of developments have placed greater financial responsibility on patients, whose share of medical expenses is growing at a far greater rate than those of payers or employers. In response, providers and employers are adapting to meet patient demands for improved access, transparency, digitalization and cost effectiveness. The resulting patient empowerment, or "consumerization," of health care and benefits puts the industry at a crossroads in many areas of financial technology and with other mainstay financial institutions. As these trends continue, investors are seeing greater opportunities to support innovation and growth at leading health care finance and employee benefits-related companies.

Greater costs, but greater choice

For decades, health care costs in the United States have increased at a faster rate than inflation. Patients are responsible for an ever-growing share of health care expenses due to the steady migration towards high-deductible plans, higher coinsurance amounts, and other structural shifts. With patients covering an increased share of medical costs, they face a broader set of considerations, not just around the availability and quality of care, but in how to plan, save and pay for health care costs and wellness needs.