Why digital health ROI matters more than ever

The Sword Summary Warm-up

Don’t have time for the full workout? We’ve got you covered with a quick, high-intensity session. Here are the key takeaways:

• Musculoskeletal conditions remain one of the largest healthcare cost drivers for large employers¹
• Traditional care pathways often erode ROI through delays, dropout, and late-stage intervention²
• Digital health ROI is strongest when early intervention, high engagement, and outcomes-based pricing work together³

The one question that health plan managers need to answer

Musculoskeletal conditions remain one of the largest and most stubborn healthcare cost drivers for large employers.¹ Yet despite years of benefit investment, many organizations are still asking the same fundamental question: what are we actually getting for our spend?

For large employers, this is no longer an abstract debate. Finance leaders are under pressure to explain rising healthcare spend in the same language they use for every other investment: risk reduction, cost avoidance, and long-term value. At the same time, HR and benefits teams are expected to show that their decisions protect productivity and workforce stability, not just access to care.

Digital healthcare programs becomes a strategic requirement for plan managers looking to increase returns. Employers are no longer evaluating whether digital programs are interesting or innovative. Leading employers understand the power of digital healthcare options that reliably change cost trajectories in ways that can be measured, forecasted, and defended.

The strongest digital health models do not simply expand access. They reshape the cost trajectory itself by intervening earlier, keeping people engaged, and aligning payment to outcomes rather than activity.

What CFOs actually mean by digital health ROI

When finance teams talk about ROI, they are not asking for utilization charts or engagement anecdotes. They are asking whether an investment reduces financial exposure in ways that are measurable, repeatable, and forecastable.

In healthcare, that typically comes down to a small number of levers that directly affect the balance sheet:

• Direct medical costs, such as avoided imaging, injections, surgeries, and specialist referrals that often follow delayed MSK care³
• Indirect workforce costs, including absenteeism, short-term disability, and lost productivity driven by unmanaged pain⁴
• Spend volatility, where a handful of high-severity claims can destabilize budgets year over year¹ ³
• Time to value, meaning whether improvements appear within months, not years⁶ ⁷

Any digital health solution that cannot clearly connect outcomes to these levers will struggle to earn long-term credibility with finance teams. Understanding those expectations is critical, because it explains why many traditional care models fail to deliver ROI, even when clinical intent is strong.

Why traditional care models quietly erode ROI

The biggest threat to digital health ROI is not rarely clinical. Most often, the chief problem s friction built into the care pathway itself.

In musculoskeletal care, that friction compounds quickly. Many employees must first see a primary care provider or specialist before accessing physical therapy, and appointment wait times in many markets stretch into weeks.¹ Once therapy begins, in-person care requires repeated travel, time away from work, and rigid scheduling. Those barriers make it difficult for people to stay consistent.

Research consistently shows that adherence to prescribed physiotherapy and exercise programs is poor, particularly when care is fragmented or inconvenient.² When treatment is delayed or abandoned, MSK issues are more likely to escalate into imaging, injections, opioid use, or surgery.³

From a financial perspective, delayed care becomes expensive care. Severity increases, recovery takes longer, and costs become harder to predict. This is why simply adding more point solutions rarely improves ROI. Engagement and outcomes must be engineered into the care model itself. That realization has pushed employers to rethink what actually drives strong digital health ROI.

Outcomes-driven digital health delivers on ROI promises

Many digital health vendors sound similar. They talk about engagement, access, and innovation. But for employers under pressure to defend spend, the real question is simpler: who is actually willing to stand behind their results?

This is where outcome-driven models begin to separate themselves from traditional digital health offerings. There are a few critical differences between outcome-based healthcare providers and the traditional fee-for-service model:

1. Early intervention changes the cost curve.
   Digital-first models allow employees to begin care within days rather than weeks. Earlier intervention is associated with lower use of high-cost services, including imaging and surgery.³
2. Completion determines whether spend pays off.
   ROI depends on people finishing care, not just enrolling. Programs that combine clinical oversight with real-time feedback and accountability consistently outperform passive or app-only solutions. Sword’s digital MSK care reports an 81% program completion rate, compared with roughly 50% for traditional in-person physical therapy² ⁶. Higher completion is closely linked to better outcomes and lower downstream spend.
3. Pricing alignment limits downside risk.
   Outcomes-based pricing ties payment to meaningful improvement rather than sessions or licenses. Employers pay only when members get better, converting digital health from a fixed cost into a performance-based investment.

Taken together, these design choices explain why some digital programs bend the cost curve while others simply add another line item.

How Sword pioneered outcome-based pricing in MSK care

Most traditional healthcare models, digital or in-person, are still rooted in volume-based economics. Providers are paid per visit, per session, or per enrolled member, regardless of whether pain improves, function returns, or productivity recovers.

Sword took a different path. Rather than charging employers for participation alone, Sword tied payment to clinically meaningful improvement. This means health plans only pay in full when members demonstrate progress in outcomes such as pain reduction, functional improvement, or productivity recovery. If those outcomes are not achieved, payment is reduced or not triggered at all.

This model fundamentally shifts risk. Instead of employers absorbing the downside of low engagement or poor results, Sword assumes accountability for delivering measurable improvement. This approach also explains why Sword fits naturally into modern MSK insurance models and value-based benefit strategies.

Why pricing tied to outcomes changes ROI dynamics

Outcome-based pricing actively improves ROI by changing how care is delivered.

When a vendor’s revenue depends on members getting better, incentives shift in meaningful ways:

• Engagement becomes a priority, not a metric on a slide.
• Early intervention matters, because delays reduce the likelihood of improvement.
• Care pathways are designed to keep people progressing, not just enrolled.

This alignment is one reason why Sword's outcome-driven digital MSK programs consistently outperform traditional models on completion and downstream cost avoidance.

Sword delivers average savings of $3,177 per engaged member per year⁷, and up to 4.4x ROI when predictive targeting is applied to high-risk populations⁸. Program completion remains high at 81%⁶, ensuring that spend follows outcomes rather than intent. These high completion rates lead to fewer escalations, fewer surgeries, and faster recovery, all of which translate directly into lower medical spend and reduced productivity loss.

For finance leaders, this matters because it converts digital health from a fixed cost into a performance-based investment:

• Spend becomes more predictable.
• ROI becomes easier to model.
• Vendor performance can be evaluated using clean ROI data

Predictive analytics can be an ROI multiplier

One of the most overlooked drivers of digital health ROI is prevention through prediction. Traditional health plans rely on claims data, which only reveals risk after costs have already occurred. Predictive models identify rising risk earlier, before escalation becomes expensive.

Sword Predict identifies employees at high risk for costly MSK events well ahead of claims-based detection, enabling earlier care and reducing the likelihood of surgery, opioid use, and prolonged disability.⁸ Earlier identification lowers case severity and improves forecast accuracy, which matters deeply to finance teams trying to control budget shocks.

Prediction does not replace care, but amplifies the financial impact by ensuring the right people get the right intervention at the right time.

Build a CFO-ready digital health ROI case

For benefits leaders, credibility with finance comes from preparation and precision.

Start with a clear baseline: MSK claims, disability trends, and productivity loss. Actively seek outcomes-based accountability from value-based care providers rather than fee-for-service vendors.

Report what finance teams value most: completion, cost avoidance, productivity recovery, and time to value.

When benefits performance is communicated in financial terms, digital health becomes a strategic asset rather than a discretionary benefit.

The strongest digital health ROI comes from models that combine early identification, high engagement, validated outcomes, and financial alignment with results.