TTA’s Autumn Action 2: a Digital Health 150 Hot List, Bubble Watch, WOT for TB, EHR alla voce, and latest on Theranos

 

As the Big Chill of Autumn sets in, there’s a new Hot List of Digital Startups, an IPO for the Bubble Watch, a fresh term for your lexicon, and a voice-activated EHR in your future. And Theranos’ Elizabeth Holmes can’t pay her legal bills. (Sigh)

CB Insights names a Top 150 of digital health startups (Quite attention-getting)
WOT with Proteus found equal to or better than DOT in TB medication adherence trial (Wirelessly Observed Therapy a new add to the lexicon)
The Theranos Story, ch. 61: Elizabeth Holmes as legal deadbeat (Priorities, priorities)
Health tech bubble watch: Alphabet-backed One Medical reportedly prepping for 2020 IPO (Letting the IPO dust settle?)
Does healthcare need a new EHR system? A major health system thinks so. (Allscripts gets a Northwell boost, alla voce)

We reflect in this fall season on the overuse of AI versus machine learning terminology–and why the TEC/telehealth boats aren’t rising with the market tide.

The confusion within TEC/telehealth between machine learning and AI-powered systems (AI is trendy, but trendy is not necessarily good when non-techies are buying your system)
If the market’s expanding, where’s the telecare and TEC boom? (A question we’ve been asking for years.)

Editor Charles jumps on the Analogue versus Digital Soapbox. (One of our most commented articles)

Telecare – time to sweat the analogue assets, not dump them (Editor Charles asks that you do your homework before you cart in that shiny new digital kit and throw the old out the window)

Summer may be winding down but activity is winding up. Doro acquires Invicta, Amazon’s PillPack hits a data wall, Humana first payer to join CTA. Judge Leon finally blesses CVS-Aetna’s merger after 9 months. And events, including Digital Mental Health at the RSM 23 Sept.

News and event roundup: Amazon PillPack, Humana joins CTA, NH’s telemedicine go, Fitbit Lives Healthy in Singapore, supporting Helsinki’s older adults, events
Shock news: the CVS-Aetna merger officially approved after 9 months (Judge Leon’s Final Judgment delivered. But what about future healthcare mergers?)
Doro AB acquires Invicta Telecare from Clarion Housing, increasing to nearly 200,000 users (UK) (Consolidation continues)
Digital Mental Health for Adults – a one day conference at the RSM on 23 September 2019 in London (Sponsored by the RSM)

Being contrarian, we consider that AI and machine learning may be doing real damage both in its workings and in the quality of all that medical data being fed into it. Regrettably, telemedicine in nursing homes looks like a permanent failure. And CMS takes the lead in the PFS with three new telehealth codes on opioid treatment.

A realistic look at why telemedicine isn’t succeeding in nursing homes (It should, but it’s the economics of the business)
Are AI’s unknown workings–fed by humans–creating intellectual debt we can’t pay off? (Building dangerous error upon error with bad data, destroying theoretical thinking–and that’s for starters)
CMS’ three new proposed telehealth codes, changes on inclusions, in 2020 Medicare Physician Fee Schedule (US) (CMS takes initiative in opioid treatment)


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Telehealth & Telecare Aware: covering the news on latest developments in telecare, telehealth, telemedicine and health tech, worldwide–thoughtfully and from the view of fellow professionals

Thanks for asking for update emails. Please tell your colleagues about this news service and, if you have relevant information to share with the rest of the world, please let me know.

Donna Cusano, Editor In Chief
donna.cusano@telecareaware.com

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Does healthcare need a new EHR system? A major health system thinks so. (Updated)

An interesting pairing to work on a ‘next generation EHR’. EHR and HIT giant Allscripts and Northwell Health, the largest health system in New York State, are partnering to develop an EHR that is AI and cloud-based and–what’s different–voice-enabled. Allscripts will, according to the release, provide development and systems integration expertise; Northwell will provide the clinician input, testbed, and also support the project with IT and administrative staff. The goal is an optimized patient and clinician experience, which is about as specific as the release gets. According to POLITICO’s Morning eHealth, the foundation for the system will be Avenel, the company’s stripped-down, cloud-based EHR platform, There’s no further information on timing, cost, what the AI might do, or whether the focus will be on acute care or outpatient/specialty practices.

Allscripts and Northwell will continue with their Allscripts EHRs in use since 2009, Allscripts Sunrise at the 19 Northwell hospitals and Allscripts Touchworks EHR used at Northwell’s 750 owned and operated outpatient practices in the metro New York area. Additional articles at Northwell’s newsroom.

Update 16 Oct: Northwell announced that it was extending its contract with Allscripts through December 2027. Read on in HISTalk for a tart take on the odds that the next-gen EHR will actually be a viable, competitive new product.

Allscripts reaches deal with DOJ on Practice Fusion in compliance settlement for $145 million

EHR giant Allscripts settled with the US Department of Justice on compliance charges made against Practice Fusion. Allscripts acquired Practice Fusion, a free/low-cost EHR targeted to primary care practices, in January 2018. A year earlier, Practice Fusion had received an inquiry from the US Attorney’s Office for the District of Vermont examining the company’s compliance with the EHR certification program. According to Fierce Healthcare, after Allscripts acquired Practice Fusion, the inquiry expanded…and expanded…to include additional certification and Anti-Kickback statute charges. Since then, Allscripts has rebranded the EHR as Veradigm.

The announcement was made during their 2019 Q2 results investor call. Their president claimed the $145 million settlement, at this point an agreement in principle with DOJ, is in line with other EHR-DOJ settlements. 

Consider it a final payment on the knockdown price ($100 million) Allscripts paid for Practice Fusion.

Their Q2 bookings were $276 million, up 31% from the prior-year period, but revenue at $445 million was lower than expectations. 

Digital health: why is it a luxury good in a world crying for health as a commodity?

Why digital health still struggles to find its stride. Those of us in the healthcare field, especially Grizzled Pioneers, have been wondering for the past decade why Digital Health’s Year is always Next Year. Or Next Decade. 

Looking back only to 2000, we’ve had 9-11, a dot-com bust, a few years in between when the economy thrived and the seed money started to pollinate young companies, a prolonged recession that killed off many, and now finally a few good economic years where money has flooded into the sector, to good companies and those walking the fine line of mismanagement or fraud. We’ve seen the rise/fall/rise of sensors, wearables, and remote monitoring, giants like Google and Microsoft out and back in, the establishment of EHRs, acceptance by government and private payers, quite a bit of integration, and more. All one has to look is at the investment trends breaking all records, with funding rounds of over $10 million raising barely a notice–enough to raise fears of a bubble. Then there’s another rising tide–that of cyberattack, ransomware, insider and outsider hacking.

Is it this year? It may not be. Despite the sunshine, interoperability holds it all back. Those giant EHRs–Cerner, Epic, Athenahealth, Allscripts–are largely walled gardens and so customized by provider application that they barely are able to talk to their like systems. There are regional health exchanges such as New York’s SHIN-NY, Maryland’s CRISP, and others, but they are limited in scope to their states. The VA’s VistA, the granddaddy of the integrated system, died of old age in its garden. Paul Markovich, CEO of Blue Shield of California cites the lack of interoperability and being able to access their personal health data as a major barrier to both patients and to the large companies who want to advance AI and need the data for modeling. (China and its companies, as we’ve noted, neatly solve this problem by force. [TTA 17 Apr]) Apple is back in with Health Records, but Mr. Markovich estimates it may take 10 years to gather the volume of data it needs to establish AI modeling. Some wags demand that Apple buy Epic, as if Epic was up for sale. BSC, like others, is testing interoperability workarounds like Notable, Ooda Health, and Manifest MedEx. Mr. Markovich cites interoperability and scaling as reasons why healthcare is expensive. CNBC

And what about those thriving startups? Hold on. During the Google Cloud/Rock Health 3 June event, one of the panelists–from Partners HealthCare, which works both side of the street with Pivot Labs–noted that hospitals have figured out their own revenue models, and co-development with hospitals is key. Even if validated, not every tech is commercially ready or lowers cost. And employers are far worse than hospitals at buying in because they ultimately look at financial value, even if initially they adopt for other reasons. In addition, the bar moved higher. The new validation standard is now provider-centric–workload, provider satisfaction, and implementation metrics, because meeting clinical outcomes is a given. Mobihealthnews

And still another barrier–data breaches and cyberattack–is still with us, and growing. Quest Diagnostics’ data breach affects nearly 12 million patients. It was traced to an individual at a vendor, American Medical Collection Agency, and it involved Optum360, a Quest contractor and part of healthcare giant Optum. The unauthorized person had access to the network for eight months – between 1 August 2018, and 30 March 2019–and involved both financial and some health records. Quest now is in the #2 slot behind the massive 79 million person Anthem breach, which, based on a Federal grand jury indictment in Indianapolis in May, was executed by a Chinese group in 2015 using spearfishing and backdoors that gathered data and sent it to China. There were three other US businesses in the indictment which are not identified. Securing health data is expensive — and another limitation on the cost-lowering effects of interoperability. Healthcare IT News

Digital Health’s Year, for now, will remain Next Year–and digital health for now will remain fractional, unable to do much to commoditize healthcare or lower major costs.

News roundup: First Stop, GlobalMed, American Well, Avizia, Medicity, Health Catalyst, Allscripts, Welbeing, BenevolentAI

[grow_thumb image=”http://telecareaware.com/wp-content/uploads/2017/12/Lasso.jpg” thumb_width=”125″ /]Announcements and acquisitions have been multiplying–here’s what’s most interesting.

In companies we’ve recently written about:

Our recent Contributor Bruce Judson, now with corporate telemedicine provider First Stop Health, wrote us enroute to the Government Finance Officials Association conference in St. Louis that FSH achieved triple-digit top-line revenue growth and also achieved an average utilization rate of 52 percent. The formal announcement was made earlier this week at the HLTH conference in Las Vegas (release), where another one of our Contributors, Sarianne Gruber, is attending for Answers Media Company.

GlobalMed, a prior contributor to Perspectives, is offering a lower cost telemedicine alternative to practices with a flat fee starting at $799 per month for three years. Startup costs remain at about $5,000. The starting kit includes a cart, a total exam camera, stethoscope and vitals linked to the organization’s network, and a nurse license. Additional compatible equipment is available at extra cost. We know that a number of comparable telemedicine cart-based kits run upwards of $8,000. It is one of the first public acknowledgments this Editor has seen (but has known for years) that high cost is a major impediment for implementing both telehealth and telemedicine in practices. Health Data Management.

In other news:

Telemedicine and telehealth consolidation continues with American Well’s acquisition of hospital-based telemed/workflow systems provider Avizia. Avizia has a product line of telemedicine carts and workflow software for 40 different specialties, including telestroke and telebehavioral health. The acquisition price was not disclosed. Prior investors in this 2013 Cisco spinoff include Northwell Health, NY-Presbyterian, HealthQuest, and other providers in seven rounds totaling over $23 million. Healthcare IT News

A further sign of consolidation, this time in the crowded health information business, is the Medicity acquisition by Health Catalyst. Health Catalyst is primarily a data analytics and warehousing company while Medicity focuses more on data interoperability and patient engagement for practices, health systems, and HIEs. Medicity was purchased by Aetna in 2011 with much fanfare for $500 million as one of its ‘Emerging Businesses’, rebranded as Healthagen in 2013 [TTA 28 Feb 14] which never quite took off. Out of that unit, what remains are Active Health Solutions and Aetna Accountable Care Solutions, a payer-driven value-based care management company. The amount of the sale was not disclosed but is expected to close in 90 days. Health Catalyst’s CEO Brent Dover served as president of Medicity up to 2013, and both companies are located in Salt Lake City. What is interesting about this sale is that CVS, which is buying Aetna, has no comparable in-house technology. It’s a probable shedding of peripheral or money-losing businesses prior to sale.  HISTalk, MedCityNews

Allscripts continues on its acquisition binge with patient communication and engagement platform HealthGrid. HealthGrid is a mobile app platform that delivers care and education materials traditionally distributed from practices to patients via paper. In January, Allscripts bought practice EHR Practice Fusion for $100 million (a loss to investors) and earlier McKesson’s HIT business for $185 million. It’s a noticeable shift to value-added care tools for this formerly EHR-centric company. Mobihealthnews. 

In UK news:

Welbeing has won Norwich City Council’s Norwich Community Alarm Service (NCAS). It provides a 24-hour, year-round monitoring and response service for over 6,500 adults who are vulnerable or at risk in this part of East Anglia. The press release is on UK Telehealthcare‘s news page. 

BenevolentAI, a UK company using artificial intelligence for drug development, raised $115 million in new funding, mostly from undisclosed investors in the United States, according to Mobihealthnews, for a total funding of over $200 million. The company uses AI to reduce drug discovery time and risk. It does not do its own drug discovery but sells the intellectual property discovered by their AI algorithms, claiming to cut drug development timelines by four years and improve efficiencies by 60 percent compared to pharma industry averages.

Lyft and Uber’s big tech twists on a Social Determinant of Health–medical-related transportation

Social determinants of health (SDOH), that widely-discussed concept often dismissed as the turf of social workers and small do-good companies such as Healthify, are receiving a substantial boost from two profit-oriented, on-demand transportation companies: Uber and Lyft. Several years ago, smaller companies such as Circulation and Veyo [TTA 21 Feb, 26 Apr 17] entered the non-emergency medical transportation (NEMT) field with their on-demand services. These proved to be valuable links in the continuum of care–valuable in helping patients make their appointments, at generally a lower cost than Access-a-Ride or taxis, while collecting a wealth of data on usage.

Uber and Lyft’s recent announcements take the NEMT concept further with integration into discharge planning, chronic care management in practices, and EHRs while keeping it simple for patients and caregivers.

  • The launch of Uber Health, targeted to healthcare organizations (and just in time for HIMSS). The ride booking for both patients and caregivers uses a HIPAA-compliant dashboard for the health manager to book the ride, and text messaging to the patient for confirmations and pickup. Over 100 healthcare organizations are piloting the service. MedCityNews
  • Lyft Business inked a deal with Allscripts to integrate booking transportation into appointment setting. The Allscripts EHR is in 45,000 physician practices and 2,500 hospitals (which doesn’t include newly-acquired Practice Fusion’s 30,000 small ambulatory sites). Besides its own driver base, Lyft also has used its Concierge API to facilitate partnerships with NEMT brokers working with providers such as Circulation, National MedTrans (the NEMT provider for Anthem’s CareMore Health Plan HMO), and American Medical Response for drivers and more specialized vehicles. Hitch Health works with Lyft and independently integrates into Epic and Athenahealth. MedCityNews, POLITICO Morning eHealth (scroll down).

But does providing transport for appointments save money? The logic behind it is that missed appointments can exacerbate existing conditions; a direct example is dialysis, where missing an appointment could result in a hospital admission. Another area is patient avoidance of making appointments. The CareMore Health Plan study reduced waiting times and ride cost, increasing patient satisfaction–great for HEDIS and ACO quality scores, but the longer-term cost saving is still to be determined.

Another attraction for Lyft and Uber: steady revenue. In Medicare Advantage, 70 percent of members are covered and all state Medicaid programs reimburse their members for qualifying transportation.

Updated–Rounding up this week’s news: VA budget, Shulkin’s troubles, ATA’s new CEO, Allscripts’ wheeling-dealing, Roche buys Flatiron, Nokia out of health?, NHS Carillioning?

[grow_thumb image=”http://telecareaware.com/wp-content/uploads/2017/12/Lasso.jpg” thumb_width=”100″ /]Here’s our roundup for the week of 12 February:

VA wins on the budget, but the Secretary’s in a spot of bother. Updated. Last week started off as a good week for Secretary Shulkin with a White House budget proposal that increased their $83.1 billion budget by 11.7 percent, including $1.2 billion for Year 1 of the Cerner EHR implementation in addition to the agency’s $4.2 billion IT budget which includes $204 million to modernize VistA and other VA legacy IT systems in the interim. While the Cerner contract went on hold in December while record-sharing is clarified, the freeze is expected to be lifted within a month. POLITICO  Where the trouble started for Dr. Shulkin was in the findings of a spending audit by the VA’s Inspector General’s Office of an official European trip to Copenhagen and London which included unreimbursed travel by Mrs. Shulkin and free tickets to Wimbledon, at least partly justified by a doctored email. This has led to the early retirement of the VA Chief of Staff Vivieca Wright Simpson and also an investigation of hacking into Wright Simpson’s email. It also appears that some political appointees in the VA are being investigated for misconduct. CNBC, FierceHealthcare.

Updated: POLITICO doesn’t feel the love for Dr. Shulkin in today’s Morning eHealth, linking to articles about the supposed ‘internal war’ at the VA, with veterans’ groups, with the Trump Administration, and within the VA. It’s the usual governmental infighting which within the 16 Feb article is being whipped by POLITICO and co-author ProPublica to a fevered pitch. Dr. Shulkin comes across as doctor/tech geek who underestimated the politicization of and challenges within an agency with the mission to care for our veterans. It’s also an agency having a hard time facing the current demands of a dispersed, younger and demanding veteran group plus aging, bureaucratic infrastructure. As usual the ‘privatization’ issue is being flogged as an either/or choice whereas a blend may serve veterans so much better.

Digital health entrepreneur named CEO of the American Telemedicine Association. A first for ATA is a chief from the health tech area who is also one of the all-too-rare executive women in the field. Ann Mond Johnson, who will be starting on 5 March, was previously head of Zest Health, board chair and advisor to Chicago start-up ConnectedHealth (now part of Connecture), and had sold her first start-up company Subimo to WebMD in 2006. She began her career in healthcare data and information with The Sachs Group (now part of Truven/IBM Watson). Ms. Johnson replaces founding CEO Jonathan Linkous, who remained for 24 years before resigning last August and is now a consultant. ATA release, mHealth Intelligence. ATA relocated in January from Washington DC to nearby Arlington Virginia. And a reminder that ATA2018 is 29 April – 1 May in Chicago and open for registration.

Allscripts’ ‘Such a Deal’! Following up on Allscripts’ acquisitions of Practice Fusion for $100 million (a loss to investors) and earlier McKesson’s HIT business for $185 million [TTA 9 Jan], it hasn’t quite paid for itself, but came very close with the sale of McKesson’s OneContent, a healthcare document-management system, for a tidy $260 million. Net price: $25 million. Their CEO is some horse trader! Some of the savings will undoubtedly go to remedying the cyberattack in January that affected two data centers in North Carolina, shutting down EHR and billing applications for approximately 1,500 physician practices, which have launched a class action lawsuit. FierceHealthcare 

Flatiron Health acquired by Roche. (more…)

MediBioSense and Blue Cedar take a new approach to secure medical wearable data (UK/US)

[grow_thumb image=”http://telecareaware.com/wp-content/uploads/2018/01/VitalPatch_Header_Photo_Tablet.jpg” thumb_width=”150″ /]Doncaster UK-based MediBioSense Ltd. has partnered with San Francisco-based Blue Cedar to protect their VitalPatch app on smartphones and tablets. MediBioSense uses VitalPatch in their MBS HealthStream system marketed in the UK in acute care and long-term care setting. Blue Cedar is securing the app through their patented code-injected technology which protects the VitalPatch-collected data from the app to the provider database. The system with Blue Cedar’s security is available directly from MediBioSense.

VitalPatch is a single-use adhesive biosensor patch applied to the patient’s chest (see left above). It monitors eight vital signs and activity signs: heart rate, respiration, ECG, heart rate variability, temperature, body posture including fall detection/severity, and steps as an indicator of activity. MediBioSense contracted with the US-based developer, VitalConnect, to sell the system in the UK. VitalPatch is US FDA-cleared (Class II) and CE Marked for the EU.

One impetus, according to the release (PDF), is the GDPR (General Data Protection Regulation), the pan-European/UK data-protection law slated to take effect in May. This not only applies to European Union citizens’ personal data but also requires reports on how organizations safeguard that data. 

Blue Cedar, which this Editor has previously profiled [TTA 3 May 17], has developed code-injection technology that secures data from the app to the provider location on their servers or in the cloud. It secures the app without the device being managed. Devices have their own vulnerabilities when it comes to apps even when secured, as 84 percent of cyberattacks happen at the application layer (SAP). Blue Cedar’s security also enables tap-and-go from an icon versus multiple security entries, thus quick downloading from app stores or websites. For companies, the secured app provides granular analytic reports about users, app usage, devices, and operating systems which are useful for GDPR requirements.

Blue Cedar’s latest release of app security is Enforce, to secure existing mobile apps using in-app embedded controls to enforce a broad range of security policies. It is sold on the Microsoft Azure cloud platform and is primarily targeted to the value-added reseller (VAR) market. 

All the more reason to use all means to secure devices and apps. When as of last week Allscripts‘ EHR for e-prescribing was hit with a ransomware attack (FierceHealthcare), yet another hospital (Hancock Regional in Indianapolis) paid $5,000 to hackers to get back online (Digital Health), and Protenus/DataBreaches.net tracks a breach a day [TTA 29 Dec 17], cybersecurity has become Job #1 for anyone in the healthcare field. (And Big Healthcare now votes for security. Protenus today announced their $11 million Series B led by Kaiser Permanente Ventures and F-Prime Capital Partners. Release.)

EHR action: Allscripts acquires Practice Fusion, expands footprint in small/ambulatory practices

A significant EHR acquisition kicks off an action-packed week. Announced today by leading EHR Allscripts is their acquisition for $100 million of independent practice EHR Practice Fusion. Allscripts, which has been usually in the top five US EHRs (Kalorama April 2017 survey), vastly expanded its hospital market share with August’s acquisition of #2 McKesson‘s health IT business and with this would be ranked just behind EHR leader Cerner. In acute care settings, Epic and Cerner dominate with 25 percent of the market each with Allscripts/McKesson far behind #3 Meditech (KLAS April 2017). 

Practice Fusion, one of the pioneers in the small practice/ambulatory EHR starting with a basic free, ad-paid model in 2005, has 30,000 ambulatory sites serving about 5 million patients each month. In the Allscripts view, they will now be able to offer “last mile” reach to the under-served clinicians in small and individual practices” and close gaps in care. Allscripts President Rick Poulton noted in the statement that “We believe this transaction will directly benefit Practice Fusion clients, who will now have access to Allscripts solutions and services. We look forward to welcoming Practice Fusion team members to our family.” which leads one to believe that the Practice Fusion name will be sunsetted. Allscripts release and Healthcare IT News

From being the leader in small practice EHRs, Practice Fusion found the last few years difficult as competition expanded into their segment, from eClinical Works, drchrono, athenahealth, and NextGen to small practice packages from Epic and Cerner.

It should be noted that Practice Fusion in 12 years went through 13 funding rounds, raising almost $158 million from a long list of VC luminaries such as Kleiner Perkins, Artis Ventures, Founders Fund, and Qualcomm Ventures (Crunchbase). However, it disappointed its investors and Wall Street, which expected two years ago a $1.5 billion IPO. The $100 million from Allscripts is all cash and the price is “subject to adjustment for working capital and net debt”–an exit which was surely not the sugarplum in the eyes of its 2014 and prior  investors. CNBC

Walgreens partners with Chicago health tech incubator MATTER (US)

Walgreens, the US retail pharmacy part of Walgreens Boots Alliance, on 20 December announced its own alliance with Chicago healthcare incubator and innovation community, MATTER. This Editor believes it is the first retail partnership with a health tech-focused incubator or accelerator in the US; most of these partnerships are with angel networks, VCs, health system venture arms or large commercial healthcare partners such as Qualcomm, Allscripts or GE Healthcare. Walgreens’ contribution will be to mentor and collaborate with MATTER entrepreneurs. Reportedly they have or have had more than 150 startups in their program. They are also part of Chicago’s push to slice itself some health tech cake versus cities like San Diego, Palo Alto, Dallas, Boston and New York via the recently launched Health Care Council of Chicago (HC3), which was co-created by MATTER and Leavitt Partners. Hopefully, Walgreens will get some of their $140 million back via their Theranos lawsuit ending their blood testing misadventure [TTA 17 Nov, Ch. 24] and spread their bets with legitimately promising startups. Press release, ChicagoInno

Friday’s cyberattack is a shot-over-bow for healthcare (updated)

[grow_thumb image=”http://telecareaware.com/wp-content/uploads/2015/03/26ED4A2300000578-3011302-_Computers_are_going_to_take_over_from_humans_no_question_he_add-a-28_1427302222202.jpg” thumb_width=”150″ /]Friday’s multiple distributed denial-of-service (DDoS) attacks on Dyn, the domain name system provider for hundreds of major websites, also hit close to home. Both Athenahealth and Allscripts went down briefly during the attack period. Athenahealth reported that only their patient-facing website was affected, not their EHRs, according to Modern Healthcare. However, a security expert from CynergisTek, CEO Mac McMillan, said that Athenahealth EHRs were affected, albeit only a few–all small hospitals.

A researcher/spokesman from Dyn had hours before the attack presented a talk on DDoS attacks at a meeting of the North American Network Operators Group (NANOG)

The culprit is a bit of malware called Mirai that targets IoT–Internet of Things–devices. It also took down the (Brian)KrebsOnSecurity.com blog which had been working with Dyn on information around DDoS attacks and some of those promoting ‘cures’. According to Krebs, the malware first looks through millions of poorly secured internet-connected devices (those innocent looking DVRs, smart home devices and even security devices that look out on your front door) and servers, then pounces via using botnets to convert a huge number of them to send tsunamis of traffic to the target to crash it. According to the Krebs website, it’s also entwined with extortion–read, ransomware demands. (Click ‘read more’ for additional analysis on the attack)

Here we have another warning for healthcare, if ransomware wasn’t enough. According to MH, “even for those hospitals with so-called “legacy” EHRs that run on the hospital’s own computers, an average of about 30 percent of their information technology infrastructure is hosted (more…)

The mixed picture of health tech investment: a potpourri

One picture is generally positive–plenty of opportunity in the aging and ill population, particularly in data integration from various sources, and value-based care. Everyone loves the excitement that a startup with a novel technology or way it can make knowledge more useful brings to the field.  Another picture is one of pitfalls aplenty, from overhyping technology (poster child, Theranos) to overestimating growth, overspending and especially picking the wrong (nervous, impatient) investors at the wrong time, which have left a general patina of mistrust around digital health. There’s also the fact that healthcare is a highly, confusingly regulated, long-cycle business that’s challenged money-wise, whether in the US, UK, Europe or Asia. Some advice to startups contained in these two articles, including from the principals of StartUp Health accelerator (who’ve seen it all), has to do with building trust, finding the right investors, the right advice/advisors, collaboration (though that is difficult with IP), finding proven (affordable) management and a sustainable (and resilient) culture. Underpromise, overdeliver.  TechCrunch, Healthcare Dive

No wonder that investment was flat in 2015, and that much of the news is around acquisitions that rearrange companies and/or offerings. The latest today is Allscripts‘ and GI Partners’ acquisition of behavioral EHR/care coordination company Netsmart for $950 million; Allscripts is moving its homecare business into Netsmart’s CareFabric suite. Kansas City Business Journal, Healthcare Dive  In addition we’ll cite our earlier Mo’ Money article on the $600 million in various digital health investments. UPMC, which had invested in Vivify Health’s telehealth/RPM platform, is spreading $3 million around partly in-house to six health tech projects developed under the Pittsburgh Health Data Alliance. And in an example of Wearables Confusion, investors put $16 million into LifeBeam to develop another DTC ‘holistic’ health wearable (LifeBeam’s origins are sensors for aerospace and defense) while early wrist fitness entrant Pebble has laid off 40 staff in an attempt to refocus on…fitness.

Early-stage companies are also alliancing and merging. Fresh out of Newark and the New Jersey Institute of Technology’s NJ Innovation Institute, the merger of Practice Unite (which knits together secure mobile clinician/patient communications into a customized platform) and Uniphy Health (physician engagement), is an example of complimentary enlargement. This expands care collaboration offerings and shades over into patient engagement if you look at the PHM quadrant here. According to Director/Chief Medical Officer Stuart Hochron, MD (who was a Practice Unite founder), “We’re really pleased with the outcome of this merger. It’s given us the capital and resources that we need to scale.” It’s also good to see that both the founders and the CTO are moving into the new Uniphy Health–and staying in Newark.  Release

Care Innovations’ Slovenski, 23andMe’s Schwartz move to Healthways

Breaking News: Healthways, an online wellness program company based in Nashville, this morning announced that two executives well known to many of us in digital health have joined them. Sean Slovenski, CEO of Intel-GE Care Innovations, is now their President, Population Health Services. Steve Schwartz, their new SVP Strategy and Corporate Development, joins the company from VP Business Development and Strategy, 23andMe.

Mr Slovenski’s track record in 2.5 years at CI certainly impressed this Editor (formerly with the developer of their behavioral telemonitoring system bequeathed from GE Healthcare, QuietCare) with turning around the company from an outpost of Intel and GEHC having difficulty transitioning from ancient technology (remember the Intel Health Guide?) to a telehealth platform dubbed Health Harmony. He also put together a team that engineered multiple academic and health system alliances, along with an interesting turn into home digital health certification. While he came to CI from health insurance giant Humana in Louisville Kentucky running their behavioral health and wellness businesses, his prior experience includes both entrepreneurial turns at his own company and with smaller companies. He most recently engineered a Louisville outpost of CI [TTA 14 Oct 15]. Since Mr Slovenski is still listed on the CI website as CEO, this may have been a quickly executed move.

Mr Schwartz’s business development background includes long stints at two large healthcare companies, Allscripts (EHRs and practice management software) and LabCorp (lab testing). He weathered 23andMe’s FDA troubles and headed up their B2B sales area. Healthways release

Unusually, Healthways is a NASDAQ traded company that closed at $12.11 today in a down market. It’s old (in our terms) having been founded in 1981, becoming publicly traded ten years later. Its last round of venture financing was $20 million from CareFirst BlueCross Blue Shield in October 2013 (CrunchBase). Healthways has a fairly new CEO as well, who joined last August and obviously feels comfortable adding to his team.

US Department of Defense picks Cerner/Leidos/Accenture for $4.3 bn EHR

Breaking News Updated  The winner of the massive, potentially ten year contract for the Defense Healthcare Management System Modernization program is defense computer contractor Leidos, which brought in Cerner and Accenture Federal Systems.The DOD announcement mentions only lead contractor Leidos, interestingly under the US Navy Space and Naval Warfare Systems Command, San Diego, California. The announcement was released just after 5pm EDT today.

This combination beat the Epic/IBM and the Allscripts/Computer Sciences/HP bids. According to the DOD announcement, “This contract has a two-year initial ordering period, with two 3-year option periods, and a potential two-year award term, which, if awarded, would bring the total ordering period to 10 years. Work will be performed at locations throughout the United States and overseas. If all options are exercised, work is expected to be completed by September 2025. Fiscal 2015 Defense Health Program Research, Development, Test and Evaluation funds in the amount of $35,000,000 will be obligated at the time of award.” Modern Healthcare attended the embargoed press conference this morning and adds in its article that only one-third is fixed cost, with the remainder as ‘cost plus’, which could conceivably run the contract to the $4.33 bn ceiling over the 10 years. The system will be used in 55 military hospitals and 600 clinics, with an initial operational test as early as 2016 (Washington Post) and full rollout by 2023.  Interoperability with private EHR systems was a key requirement (Healthcare IT News).Over the 18 year life cycle, the contract value could be up to $9 bn, according to the WaPo.

The race to replace DOD’s AHLTA accelerated with the final failure to launch a plan to create a joint DOD-VA EHR in March 2013 [TTA 27 July 13], though hopes revived in Congress occasionally during the past two years [TTA 31 Mar].

It is also widely interpreted as a blow to Epic, which has been defensive of late about its willingness to play in the HIT Interoperability sandbox with other EHRs; certainly it cannot make Big Blue, which would undoubtedly have found some way to sell Watson into this, happy.

POLITICO’s Morning eHealth had many tart observations today, mostly pertaining to the belief of some observers that Cerner will be strapped in meeting this Federal commitment and would find it increasingly difficult to innovate in the private sector.

Example–From Micky Tripathi, CEO of the Massachusetts eHealth Collaborative: “My biggest worry isn’t that Cerner won’t deliver, it’s that DOD will suck the lifeblood out of the company by running its management ragged with endless overhead and dulling the innovative edge of its development teams. There is a tremendous amount of innovation going on in health IT right now. We need a well-performing Cerner in the private sector to keep pushing the innovation frontier. It’s not a coincidence that defense contractors don’t compete well in the private sector, and companies who do both shield their commercial business from their defense business to protect the former from the latter.”

Unnerving mergers (US-UK); DoD’s EHR picked; EHRs & AMA

Blues feeling Blue about…The Anthem-Cigna merger, finalized last week (but yet to be approved by the US and likely the UK Governments as Cigna issues policies there), gives them bragging rights over the Aetna-Humana merger and Optum/United Healthcare in their covering of 53 million US lives as the largest US health insurer. Unnerved is the Blue Cross and Blue Shield Association, of which Anthem is a part of with the Anthem and Empire Blue Cross plans plus others in a total of 14 states. But Anthem also competes with ‘the Blues’ in 19 additional states where it markets under a non-Blue brand, Amerigroup, primarily for Medicare and Medicaid (state low-income coverage). Many of the Blues are non-profit or mutual insurers; many are partial or single-state, like Independence, Capital and Highmark (PA/DE/WV) in Pennsylvania and Horizon Blue Cross of New Jersey. Their stand-alone future, not bright since the ACA, now seem ever dimmer in this Editor’s long-time consideration and that of Bruce Japsen writing in Forbes. Also Morningstar considers Anthem’s overpaying and the LA Times overviews.

Walgreens Boots Alliance, another recent merger of quintessentially American and British drug store institutions, named as its interim CEO Stefano Pessina. He previously ran Alliance Boots prior to the merger and is the largest individual shareholder of WBA stock with approximately 140 million shares, so one cannot call it a surprise. At a youthful 73 (see video), one assumes he also takes plenty of Walgreens vitamins and uses Boots No 7 skin care. Forbes.

Updated: The big EHR news is the US Department of Defense announcing the award of its Defense Healthcare Management System Modernization contract this week. At 10 years and $11 billion, even giant EHRs went phalanxed with other giant government contractors to face DOD: Epic with IBM; Cerner with Leidos, Accenture and Intermountain Healthcare; Allscripts with Computer Sciences Corp. and Hewlett Packard. Certainly there will be ‘gravitational pull’ that affects healthcare organizations, but the open and unanswered question is if that pull will include the far nearer and immediately critical lack of interoperability with the Veterans Health Administration’s (VA) VistA EHR. The Magic 8 Ball reads: Hazy, try again later.  Leidos/Cerner announced as winners close of business Wednesday 29 July. 

In other EHR news, US doctors vented last week on how much they hate the @#$%^&* things to the American Medical Association‘s ‘town hall’ in Atlanta. Bloat, diminished effectiveness, error, getting in the way of care due to design by those without medical background presently prevail. The AMA’s Break the Red Tape campaign asks CMS to “postpone” finalizing Stage 3 Meaningful Use (MU) rules so that it can align with new payment/delivery models. Better yet, they should buy thousands of copies of Dr Robert Wachter’s book [TTA 16 Apr] and drop them on every policymaker’s desk there, with a thud. Health Data Management 

Onward the 76 Hundred! Healthcare M&A, funding jam the news

Healthcare mergers, acquistions, investments and joint ventures are doing their own Charge of the Light Brigade as we cross the mid-year bar.

* Onward the 76 Hundred! 7,600 startups around the world are developing solutions in digital health, according to accelerator/investor StartUp Health’s 2015 mid-year report. It also notes that ‘personalized solutions’ are the It Girl of digital health, and that data analytics/big data has fallen to third in investor interest after wellness/benefits (largely skewed by Zenefits) and patient/consumer 
experience received large funding rounds. Cheering news is that StartUp Health notes that investment in 50+ health companies is remaining steady. But the rest might be a bit frothy. The Gimlet Eye’s tut-tut: “whatever Zenefits is, it can’t produce enough Employee Wellness and manage enough HR to be worth an investment of $500 million”. For our Readers, we give you a direct link to their 2015 Midyear Funding Insights Report. (We await RockHealth’s take on the the Year to Date.)

* Onward with an IPO! Telemedicine darling Teladoc (TDOC, NYSE) is even more so with a smashing initial public offering, targeted to open at $19 which closed on Wednesday at $28 and today (Thursday) at same. Rosy forecasts abound despite those annoying losses ($12.7 million in 1st quarter ’14) and court action (Dallas News, TTA 9 June) . We at TTA are sticklers on terminology; still, we were happily surprised to see USA Today in our corner chiding Mr Gorevic on his misapplication of telehealth for telemedicine.

* Onward to Invest in Each Other! The new Allscripts-NantHealth deal gives new meaning to swap. EHR Allscripts bought a $200m, 10 percent equity stake in NantHealth, the health informatics chunk of Dr. Patrick Soon-Shiong’s NantWorks mini-conglomerate. Meanwhile another Soon-Shiong company bought stock valued at $100m in Allscripts. Neil Versel in MedCity News

* Onward from Amsterdam to Tel Aviv! MedCity News and Reuters also report that Teva Pharmaceuticals and Philips Healthcare have inked a joint investment (more…)