Medicare's New App Store Opens a $1 Trillion Market to Health Startups

Medicare is launching its own app store, where health startups can offer tools directly to 67 million beneficiaries while tapping into medical records from across the healthcare system.

The Centers for Medicare & Medicaid Services (CMS) announced July 30 that it will create this new digital ecosystem to provide patients with new tools and services for managing chronic diseases, finding providers, and securely accessing and sharing their health records.

“For decades, bureaucrats and entrenched interests buried health data and blocked patients from taking control of their health,” said HHS Secretary Robert F. Kennedy, Jr. in a news release. “That ends today. We’re tearing down digital walls, returning power to patients, and rebuilding a health system that serves the people. This is how we begin to Make America Healthy Again.”

Companies interested in participating in the initiative must deliver working solutions by the first quarter of 2026, when CMS plans to launch its app library on Medicare.gov.

The CMS Initiative’s Infrastructure

Today, most health records are stuck inside siloed electronic health record (EHR) systems that can’t communicate with each other. To make the new system work better, CMS is asking the companies and organizations that collect and store health data to adopt common standards so patient information can flow more easily between different hospitals, clinics, pharmacies and apps.

Already, dozens of companies that manage or exchange health data, ranging from EHR vendors to health systems and app developers – including major players like Epic, Oracle and CVS – have pledged to adopt this new “CMS Interoperability Framework.”

Mehmet Oz, MD, Administrator of CMS, called the project a long-overdue modernization of American healthcare.

“For too long, patients in this country have been burdened with a healthcare system that has not kept pace with the disruptive innovations that have transformed nearly every other sector of our economy,” he said in the news release.

Startups and Chronic Care in Focus

One area where CMS is focused on is digital tools for preventing disease and managing chronic conditions, two major drivers of healthcare costs. One of the first companies to join the initiative is Virta Health, which will use clinical data from the new CMS data sharing system to support personalized interventions for diabetes and obesity.

“This effort to unleash the full power of data-driven care is a major step toward transforming health outcomes and lowering tax payer costs at scale,” said Sami Inkinen, co-founder and CEO of Virta Health, in a statement. “Tens of millions of Medicare beneficiaries are living with chronic metabolic conditions that are reversible—not just manageable.”

Industry Support for CMS Initiative

The new initiative has attracted more than 60 companies across technology, health and insurance industries, including Aetna, Amazon, Apple, Cleveland Clinic, Google, Humana, Microsoft, OpenAI, Oracle, UnitedHealth Group and ZocDoc. CLEAR, the digital identity verification company seen at airports, is also supporting the new system.

The Electronic Health Record Association said in a statement that the plan “promises to accelerate progress toward a more connected and transparent healthcare ecosystem,” by opening more ways for data to be shared, whether through patient apps, EHRs or insurance platforms and by encouraging the use of new digital tools and AI.

HIMSS, or the Healthcare Information and Management Systems Society, said the initiative and further investments in digital health infrastructure are essential for improving high-quality care in public health.

“The framework will empower constituents to easily find, store, share and use electronic health information in ways that are secure, timely and reliable,” said HIMSS President and CEO Hal Wolf in a statement. “This is crucial for improving individual patient care and population health outcomes.”

Opting In will be an Option

CMS has stated that the app ecosystem will be fully opt-in, and that there will be no centralized, government-run database of patient information. Instead, the initiative relies on a decentralized model in which data remains with the original providers while new standards and digital identity tools enable patients to access and share that data across systems in a secure, controlled way.

“The Office of Civil Rights supports actions that improve the timeliness in providing individuals with access to their electronic protected health information, without sacrificing health information privacy and security,” said OCR Director Paula M. Stannard.

CMS plans to begin exchanging claims and clinical data through aligned networks in the first quarter of 2026.