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By Alexis Kayser
Healthcare Editor
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Watch the full webinar, "Wearables: What's the ROI for Health Systems?" above.
Consumer-grade wearable devices like Apple Watches, Fitbits, Oura rings and WHOOP bands have grown increasingly savvy in recent years—especially as AI allows for more in-depth analysis of users’ biometrics. This is good news for the companies that produce such devices, and for the users who rely on them for health insights. But for regulatory agencies like the U.S. Food and Drug Administration (FDA), these rapid advancements have blurred the lines between wellness tools and medical-grade devices, complicating an infamously lengthy process for regulatory approval.
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In response to the market pressure, the FDA announced on January 6 that it would ease regulations on wearable devices and other software designed to promote individual wellness. That move will allow developers to bypass the extended review process reserved for medical-grade devices, accelerating the emergence of new wearable devices with upgraded capabilities.
Industry leaders discussed the pros and cons of the FDA’s decision at a recent Newsweek virtual event. While wearables developers praised the shift as a net positive for consumers and health care providers, one physician leader warned that loosening regulatory oversight could complicate clinical partnerships with tech companies if “post-market surveillance mechanisms” don’t prove trustworthy.
The webinar, “Wearables: What’s the ROI for Health Systems?” took place on January 22. An expert panel, including Alex Vannoni (head of healthcare product at WHOOP), Dr. David Battinelli (executive vice president and physician-in-chief at Northwell Health, and dean of the Donald and Barbara Zucker School of Medicine at Hofstra/Northwell, both based in New York) and Patrick Sheehan (vice president of value-based care at Withings) spoke to and answered questions from an audience of health care leaders.
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Throughout the event, panelists discussed use cases for wearable devices in clinical settings and debated barriers to integration, such as winning physicians’ support for the technology and managing the firehose of data that daily smartwatch wearers produce. Solutions to these issues are increasingly urgent given the devices’ prevalence and medical potential, speakers agreed.
The demand for high-tech wearables is growing, with nearly one in three Americans owning such a device. And as medical capabilities evolve, health systems and insurance companies are looking to get in on the action by partnering with wearables developers to track chronic disease progression and identify health issues before they escalate to an emergency department visit.
AI has also sent innovation into overdrive, allowing companies to develop sophisticated software and algorithms at a historic pace, according to WHOOP’s Vannoni. As a result, he said, “The FDA, but [also] all regulatory bodies internationally are in a very challenging position at the moment given the speed at which technology is moving.”
Speaking with FOX Business on January 6, FDA Commissioner Marty Makary acknowledged that it was time for the agency to draw a line in the sand.
“We want to let companies know, with very clear guidance, that if their device or software is simply providing information, they can do that without FDA regulation," Makary said. "The only stipulation is if they make claims of something being medical grade ... like blood pressure measurement. We don't want people changing their medicines based on something that's just a screening tool or an estimate of a physiologic parameter."
At Newsweek's event, Vannoni said that while the FDA's mandate is still "safety and efficacy, as it should be," this new policy will allow wearables developers to "provide new data and insights in lower-risk scenarios."
WHOOP is familiar with the FDA's processes for medical devices, Vannoni added, referencing their heart screener feature that was greenlit by the agency last May. That tool allows WHOOP band-wearers to take electrocardiograms (ECGs) from the wrist and can detect atrial fibrillation (an irregular heart rhythm that can lead to serious complications, including stroke or heart failure). The FDA will continue to play a necessary part in cases like these, where unusual readings could influence medical decisions, according to Vannoni.
But other applications, like step counters and sleep trackers, don't always call for the same level of federal oversight. By loosening the reins on those sorts of features, the FDA is clearing the path for wearables companies to create new tools that help people understand their bodies better, Vannoni said.
"[WHOOP] spends a lot of time on accuracy, on clinical validation," Vannoni said. However, "the FDA's new standards will allow us to have all of that rigor [internally], and maybe bring something to market under the right scenario or the right guise to help our members, but not necessarily follow the traditional pathways that have existed in the past."
Sheehan, who works for Withings—the company that developed the first smart scale in 2009—echoed Vannoni’s support for the agency’s decision, agreeing that the move will make it easier for their companies to innovate and engage consumers in their own health.
Even so, regulatory clearance will remain essential to unlocking clinical use cases and return on investment, Sheehan said. Health care providers often look to FDA clearance as a baseline signal of safety and effectiveness for wearable devices. And those stamps of approval could also prove valuable in convincing health insurers to cover care costs for beneficiaries enrolled in wearable-based health care programs—a major priority for all members of the panel.
“The FDA is a path for us to really have ROI in the health care system,” Sheehan said, “and the reason for that is, if we want to change the trajectory of a patient with a chronic condition, whether it be hypertension, diabetes, heart failure, we have to go through the traditional regulatory path to remove that liability from our [provider] partners [so they can] use that data and take action on it.”
There are still some questions about exactly how the FDA's new strategy will play out. If wearables companies don't explicitly state that a feature provides medical-grade insights, Makary doesn't sound too keen on chasing them down, according to his FOX Business interview. Some tools could fall into a gray area, proving valuable in clinical settings but not getting flagged for a full FDA-level review.
"If they're not making claims that they are medical grade, let's let the market decide," Makary said. "Let's let doctors choose from a competitive marketplace which ones they recommend for their patients."
Battinelli—the only doctor and health system executive on the Newsweek panel—expressed a cautious view, calling the lighter regulation pathways a “double-edged sword.”
“Listen, I like speed to win and bring new things [to market],” Battinelli said, “but that will lead to post-market issues. As long as the post-market surveillance mechanisms are adequate, I think we’ll be okay.”
If not, he added, “then we could be in some trouble.”
This event was part of a series of Newsweek webinars that will take place throughout 2026, addressing the most critical issues facing health care—including financial pressures, workforce strain, rapid technological change and shifting patient demands.
Click here to register for Newsweek's February 3 webinar, "Preventing Chronic Disease Patients From Falling Through the Cracks," featuring leaders from Cleveland Clinic, Endeavor Health, OURA and Sutter Health.
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