How startup innovation can power the shift from hospital to community care
By Claire Morris, chief studio officer at Founders Factory
By 2040, the number of people living with major health conditions such as diabetes, cancer, heart failure and dementia is projected to rise by 39 per cent.
This surge threatens the resilience of the healthcare system and risks dragging the UK economy down as rising illness reduces workforce participation and productivity.
If we continue to treat long-term conditions primarily through hospital-centred models, the strain will become unmanageable.
The solution lies in redefining where and how healthcare is delivered.
There’s a pressing opportunity here to look at current care pathways with fresh eyes, building on evidence of the overwhelming positive benefits to patients and medical teams – from increased patient autonomy, savings in primary-care settings cost, and an overall easing of pressure on NHS services.
Shifting from reactive hospital care to proactive, technology-enabled community care is part of the NHS’s plan.
We’ve already seen the adoption of virtual wards and wearable devices proving that innovation can deliver – in March 2025, there were 20 virtual ward beds per 100,000 GP-registered people in England.
And in the past few weeks we’ve seen the release of plans for NHS Digital – a national virtual NHS Trust launching that focuses on remote care and digital triage models in order to tackle waiting lists.
With an increasingly aging and at-risk population, how do we innovate and unlock new chapters in healthcare to improve services and keep patients out of the hospital for as long as possible?
At Founders Factory, we’re exploring this future through our Hospital to Community programme, an InnovateUK-backed initiative that supports startups building the technologies and services that can shift care closer to home.
We’re seeing first-hand how the work of innovative startups addresses some of these issues and provides optimism about the future of UK healthcare.
The case for community care
The case for community care is valid across the full care journey – from early discharge and acute recovery to long-term condition management and proactive care. We’ve seen demand in our own ventures, whether in the increasing demand in Scan.com’s MRI, Ultrasound, CT and X-Ray products or the fact that 80 per cent of the previous Children’s Health cohort each received followup grant funding towards £100k.
Evidence for the benefits of placing care in the community is also driving the NHS to make a strategic shift from hospital to community. We’re seeing:
- Patient demand: People want care that’s convenient, personalised, and seamlessly integrated into their lives.
- System efficiency: Every unnecessary hospital visit avoided, frees capacity for urgent cases.
- Economic necessity: The costs of rising illness demands scalable, preventative approaches.
But the gap between ambition and reality remains significant.
Community-based care requires new models of delivery and continued investment in diagnostics, monitoring, data integration, financing, and trust-building with patients – from research to pilots and capital to scale.
Technology critical to transformation
Claire Morris
Technology is key to the reinvention of health-based care.
With healthcare accounting for around 9.6 per cent of public and private expenditure over the past two decades, it’s easy to understand why tech-enabled solutions that cut costs are central to the Government’s 10-year NHS plan.
As the health service undergoes significant transformational change, the delivery of impactful innovation will come from outside the health service in the form of agile, imaginative startups with unwavering ambition.
We see four areas where startups can make the biggest difference:
- Remote diagnostics and monitoring: Tools that allow early detection and continuous monitoring of conditions such as diabetes, COPD, and cardiovascular disease. From connected wearables to AI home diagnostics, these innovations reduce hospital admissions by intervening before episodes occur.
- Data integration and interoperability: Healthcare data remains fragmented across GP surgeries, hospitals, and social care. Startups tackling interoperability and secure data-sharing create the foundation for coordinated community care. A single view of the patient enables more proactive interventions.
- Workforce augmentation: With staff shortages among the NHS’s greatest challenges, technology that automates administrative tasks, triages patients, or extends clinical capacity can give professionals more time with patients.
- Behavioural health and patient engagement: Conditions such as diabetes and heart failure are driven by lifestyle and adherence challenges. Digital therapeutics, personalised nudging, and community support platforms can help patients self-manage effectively.
Barriers to overcome
Even with the best intentions, the relationship between healthcare technology and the NHS is often paradoxical.
Despite the UK healthtech sector’s ~£24 billion annual turnover and London’s status as a leading healthtech hub in Europe, scaling within the NHS and delivering change remains a significant hurdle for many ambitious founders.
The cost of capital for health innovation remains high, especially for unproven solutions. Procurement cycles can be slow, and pilots often fail to translate into scaled adoption. Patients may be wary of digital-first care, while clinicians may hesitate to trust unfamiliar technologies.
Overcoming these barriers requires a coalition approach:
- Government and NHS bodies must continue to invest in adoption pathways and regulatory clarity.
- Corporate and public-private partnerships can help derisk early-stage ventures.
- Founders and investors must focus on rigorous evidence and measurable outcomes.
Towards a proactive health system
What does success look like? In a decade, patients with chronic conditions should receive the majority of their care in the community, supported by technology that prevents crises and empowers them to live well.
Hospitals will be reserved for the sickest and most complex cases.
The shift will not happen overnight, nor will it be achieved through technology alone.
But with the right ecosystem of founders, clinicians, regulators, and investors, it is achievable.
The UK is uniquely placed to lead this transformation.
Our global NHS brand, concentration of health tech startups, and forward-looking regulators create fertile ground to refresh care models.
The choice is stark: either continue with incremental fixes to an overstretched hospital model or embrace a proactive, community-first approach enabled by innovation.
If we choose the latter, the prize is not just a more sustainable NHS but a healthier, more productive society.
