Apple Watches Could Be Covered by Insurance, In Boost To Wearables Sector

Apple Inc. AAPL is moving further into health care and reportedly working with insurers on getting Apple Watches strapped on the wrists of seniors as a key tool for measuring and tracking their health.

What To Know

CNBC reported Wednesday that Apple is in talks with at least three Medicare plans about partial coverage of the Apple Watch for people over 65, while also discussing the idea with non-Medicare insurers.

So far, Apple hasn’t officially made a deal with any insurance companies, sources told CNBC. But Cupertino has made it clear health care will be a key part of its business, with CEO Tim Cook saying recently it will be the company’s biggest contribution to society.

Why It’s Important

Tracking health metrics before small health issues become big ones has been a goal of medicine for more than a decade, and tech companies are starting to understand the potential wearables and data sharing about health could have.

Yet many of the people with the most difficult health issues also can’t afford something like an Apple Watch, which starts at $279 for older models. Newer models — which include more health care-related technology like fall detection and heart rhythm monitoring — are even more expensive, starting at nearly $400.

The newest Apple Watch can detect atrial fibrillation, a heart condition that could indicate a higher risk for stroke or eventual heart failure.

Insurance companies say the preventive information gleaned from such wearable technology can save treatment dollars in the long run.

Apple isn’t alone among tech companies in seeing its future tied, at least in part, to health monitoring, and in trying to get insurers to pick up some of the cost, said Ivan Feinseth, chief strategist at Tigress Financial Intelligence.

He pointed out in a Thursday note to investors that Garmin Ltd. GRMN is also integrating its Civosmart fitness monitor with a data-sharing platform made by QUALCOMM, Inc. QCOM’s Qualcomm Life subsidiary and offers insurance rebates to users in UnitedHealth Group Inc UNH’s Motion wellness plan.

“I believe that this highlights additional opportunities for Apple and also the strength of Garmin’s leading position in smart wearables,” Feinseth said. “I continue to recommend purchase of both Apple and Garmin.”

What’s Next

The integration of wearable health monitoring devices into the mainstream medical establishment will continue, bolstering Apple and others in the sector, Feinseth said. 

Apple’s Cook said the industry is just starting to understand the potential.

“We’re just at the front end of this," Cook said in a CNBC interview. "But I do think, looking back, in the future, you will answer that question: Apple's most important contribution to mankind has been in health."

Apple was trading down 0.52 percent at $154.14 at the time of publication Thursday.

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Photo courtesy of Apple.