TTA’s Week: CMS antes up for telehealth in Medicare, DeepMind Health moves to Google, more

 

Is there really hope that telehealth will finally be accepted by US doctors because they will actually be paid for it–and then pay vendors? And in No Surprise, Google exercises right of ownership, reorgs DeepMind Health into new division.

UK’s DeepMind loses Streams, health projects to Google Health (DeepMind UK staff, initiatives stay–for now)
The wind may finally be at the back of telehealth distribution and payment (US) (Real advances in Medicare reimbursement could not come sooner for emerging and struggling companies)


Editor’s Note: Due to the (US) Thanksgiving holiday on 22 Nov and business travel during the week of 11/26, the next regularly scheduled Alert will be 6 Dec.

Happy Thanksgiving!


Babylon Health’s AI diagnostic efficacy challenged. CVS-Aetna’s merger out of the oven by Thanksgiving. And a win for TECS with Canary Care.

Is Babylon Health’s AI on par with a human diagnostician? Claim questioned in ‘The Lancet’. (What $100 million should be solving)
Comings and goings: CVS-Aetna finalizing, Anthem sued over merger, top changes at IBM Watson Health 
Canary Care re-emerges as Canary Care Global Ltd, confirms continued operations (A happier outcome)

Was Pepper’s Question Time a media stunt that overshadowed the larger discussion around robotic disruption? And we wind up the UK telehealth event year.

Upcoming UK telecare and telehealth events; SEHTA calls for Healthcare Business Awards nominees (Winding up the year)
A critical take on Pepper’s Parliament Question Time (UK) (Larger questions on robotics’ effect were missed)

A robot speaks to a Commons select committee and may be more lively than most of the MPs. The FCC backs telehealth with $100 million plus, a report on NIH’s massive ‘All of Us’ population health initiative, and MIT’s emotional support robots. 

Pepper pays a first-ever robot visit to Commons on the future of AI and robotics on education, older adult care (UK) (Is the US Congress next?)
Connected Health Conference highlights (so far): FCC’s $100 million telehealth pilot, NIH’s ‘All of Us’, MIT’s social robots integrating AI

DNA analysis goes food shopping to prevent Type 2 diabetes in the prone. Zimmer uses Apple Watch to monitor hip/knee replacement patients. A Code of Practice for IoT in UK. Plus NYeC’s Gala Awards, MedStartr’s latest challenge at AMIA, and our international company news roundup.

DNA-based personalized food choices to prevent Type 2 diabetes onset in test with Imperial College, London and Waitrose (UK) (Combining DNA testing with food shopping)
Apple Watch, Zimmer Biomet in clinical trial for monitoring hip and knee replacements (Potentially huge impact on outcomes)
News roundup: Partners HealthCare Pivot Labs, TytoCare’s CE Mark, ISfTeH’s 2019 conference calls for presentations, three Smart Ageing Prizes awarded (From Bilbao to Boston)
MedStartr Challenge at the AMIA Annual Symposium 5 November (Pick your companies!)
NYeC’s 2018 Gala & Awards on 27 November (US) (Mix with the top folk in NY healthcare)
UK sets forth a Code of Practice for secure IoT for connected devices and smart homes (Sound guidelines, but enforcement?)

Digital health funding finally soars to the moon–in the home. BlackBerry is alive and Sparking, Withings is back. E-triggers to detect misdiagnosis. And are you going to Connected Health in Boston?

$6.8 bn in digital health funding through Q3 blows the doors off 2017: Rock Health (And the vote’s for in-home health)
It’s Alive! BlackBerry still Sparking with an ‘ultra-secure hyperconnectivity’ healthcare platform (Plugging the gap in EoT)
Diagnostic ‘e-triggers’ in EHRs to detect misdiagnosis, identify high-risk patients over time (Mining that data with machine learning and AI)
Withings returns to international markets with Steel HR Sport and a new Go (From Finland to France, and back to design heritage)
A preview of this week’s Connected Health Conference in Boston (Three days of immersion at the Seaport)

Lessons from Theranos for Silicon Valley? Are the new Apple Watch health features a mismatch to their market? Whither GEHC’s future within the Death Star? Will healthcare AI hype melt from a dash of cold water? Accreditation increasing provider burden?

The Theranos Story, ch. 57: was it Silicon Valley and Startup Culture bad practices pushed to the max? (The ‘hit to hope’ has two meanings)
Accrediting telehealth and remote patient monitoring providers (US) (Another try that may work this time, but increasing the training burden)
The Apple Watch, ECG and fall detection–a trend too far? (A market disconnect between those who buy and who actually need)
CEO change at GE may mean delay or cancellation of GE Healthcare spinoff–for good or ill (Time to destroy the Death Star?)
A sobering, mercifully hype-free view of AI in healthcare (A needed cold water bath)

Vital signs monitoring that reads people through walls and could revolutionize RPM.

No more smartwatches or connected tablets? Reading human vital signs through walls via a reverse Wi-Fi box and machine learning (A future without PERS, tablets, watches….)

Breaking news about 3rings and Canary Care. Babylon Health has no problem with funding–and spending. Cigna-Express Scripts clears DOJ. Two warnings about code running amuck if we don’t chill. More on Best Buy’s Assured Living. And more!

3rings assistive tech will be ringing off next March (UK) (Breaking news on yet another sad health tech closure)
Canary Care goes into administration, is acquired by Lifecycle Software (UK) (Breaking, but perhaps some hope)
AI promises, promises! Babylon Health to spend $100m, hire 1,000 to develop leading AI platform (Attracting funding like a magnet)
Cigna’s $69 million acquisition of Express Scripts clears US Department of Justice hurdle (But 50 hurdles lie ahead)
Weekend reading: the deadly consequences of unpredictable code (Don’t be in a bike in front of a self-driving car)
IoT=Cyberdisaster, if we don’t chill innovation and secure it. It’s hip to be scared! (An argument for rational regulation)
Best Buy update: ‘Assured Living’ assuredly up and running. And was this Editor’s in-store experience not typical? (Should have the Geeks to the house for the TV)


Have a job to fill? Seeking a position? Free listings available to match our Readers with the right opportunities. Email Editor Donna.


Read Telehealth and Telecare Aware: http://telecareaware.com/  @telecareaware

Follow our pages on LinkedIn and on Facebook

We thank our present and past advertisers and supporters: Tynetec, Eldercare, UK Telehealthcare, NYeC, PCHAlliance, ATA, The King’s Fund, HIMSS, Health 2.0 NYC, MedStartr, Parks Associates, and HealthIMPACT.

Reach international leaders in health tech by advertising your company or event/conference in TTA–contact Donna for more information on how we help and who we reach. See our advert information here. 


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

– – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – –

TTA’s Week: Babylon Health’s 81% diagnostic rate challenged, Canary Care re-emerges, CVS-Aetna’s Thanksgiving, top changes at Watson Health, more

 

 

Babylon Health’s AI diagnostic efficacy challenged. CVS-Aetna’s merger out of the oven by Thanksgiving. And a win for TECS with Canary Care.

Is Babylon Health’s AI on par with a human diagnostician? Claim questioned in ‘The Lancet’. (What $100 million should be solving)
Comings and goings: CVS-Aetna finalizing, Anthem sued over merger, top changes at IBM Watson Health 
Canary Care re-emerges as Canary Care Global Ltd, confirms continued operations (A happier outcome)

Was Pepper’s Question Time a media stunt that overshadowed the larger discussion around robotic disruption? And we wind up the UK telehealth event year.

Upcoming UK telecare and telehealth events; SEHTA calls for Healthcare Business Awards nominees (Winding up the year)
A critical take on Pepper’s Parliament Question Time (UK) (Larger questions on robotics’ effect were missed)

A robot speaks to a Commons select committee and may be more lively than most of the MPs. The FCC backs telehealth with $100 million plus, a report on NIH’s massive ‘All of Us’ population health initiative, and MIT’s emotional support robots. 

Pepper pays a first-ever robot visit to Commons on the future of AI and robotics on education, older adult care (UK) (Is the US Congress next?)
Connected Health Conference highlights (so far): FCC’s $100 million telehealth pilot, NIH’s ‘All of Us’, MIT’s social robots integrating AI

DNA analysis goes food shopping to prevent Type 2 diabetes in the prone. Zimmer uses Apple Watch to monitor hip/knee replacement patients. A Code of Practice for IoT in UK. Plus NYeC’s Gala Awards, MedStartr’s latest challenge at AMIA, and our international company news roundup.

DNA-based personalized food choices to prevent Type 2 diabetes onset in test with Imperial College, London and Waitrose (UK) (Combining DNA testing with food shopping)
Apple Watch, Zimmer Biomet in clinical trial for monitoring hip and knee replacements (Potentially huge impact on outcomes)
News roundup: Partners HealthCare Pivot Labs, TytoCare’s CE Mark, ISfTeH’s 2019 conference calls for presentations, three Smart Ageing Prizes awarded (From Bilbao to Boston)
MedStartr Challenge at the AMIA Annual Symposium 5 November (Pick your companies!)
NYeC’s 2018 Gala & Awards on 27 November (US) (Mix with the top folk in NY healthcare)
UK sets forth a Code of Practice for secure IoT for connected devices and smart homes (Sound guidelines, but enforcement?)

Digital health funding finally soars to the moon–in the home. BlackBerry is alive and Sparking, Withings is back. E-triggers to detect misdiagnosis. And are you going to Connected Health in Boston?

$6.8 bn in digital health funding through Q3 blows the doors off 2017: Rock Health (And the vote’s for in-home health)
It’s Alive! BlackBerry still Sparking with an ‘ultra-secure hyperconnectivity’ healthcare platform (Plugging the gap in EoT)
Diagnostic ‘e-triggers’ in EHRs to detect misdiagnosis, identify high-risk patients over time (Mining that data with machine learning and AI)
Withings returns to international markets with Steel HR Sport and a new Go (From Finland to France, and back to design heritage)
A preview of this week’s Connected Health Conference in Boston (Three days of immersion at the Seaport)

Lessons from Theranos for Silicon Valley? Are the new Apple Watch health features a mismatch to their market? Whither GEHC’s future within the Death Star? Will healthcare AI hype melt from a dash of cold water? Accreditation increasing provider burden?

The Theranos Story, ch. 57: was it Silicon Valley and Startup Culture bad practices pushed to the max? (The ‘hit to hope’ has two meanings)
Accrediting telehealth and remote patient monitoring providers (US) (Another try that may work this time, but increasing the training burden)
The Apple Watch, ECG and fall detection–a trend too far? (A market disconnect between those who buy and who actually need)
CEO change at GE may mean delay or cancellation of GE Healthcare spinoff–for good or ill (Time to destroy the Death Star?)
A sobering, mercifully hype-free view of AI in healthcare (A needed cold water bath)

Vital signs monitoring that reads people through walls and could revolutionize RPM.

No more smartwatches or connected tablets? Reading human vital signs through walls via a reverse Wi-Fi box and machine learning (A future without PERS, tablets, watches….)

Breaking news about 3rings and Canary Care. Babylon Health has no problem with funding–and spending. Cigna-Express Scripts clears DOJ. Two warnings about code running amuck if we don’t chill. More on Best Buy’s Assured Living. And more!

3rings assistive tech will be ringing off next March (UK) (Breaking news on yet another sad health tech closure)
Canary Care goes into administration, is acquired by Lifecycle Software (UK) (Breaking, but perhaps some hope)
AI promises, promises! Babylon Health to spend $100m, hire 1,000 to develop leading AI platform (Attracting funding like a magnet)
Cigna’s $69 million acquisition of Express Scripts clears US Department of Justice hurdle (But 50 hurdles lie ahead)
Weekend reading: the deadly consequences of unpredictable code (don’t be in a bike in front of a self-driving car)
IoT=Cyberdisaster, if we don’t chill innovation and secure it. It’s hip to be scared! (An argument for rational regulation)
Best Buy update: ‘Assured Living’ assuredly up and running. And was this Editor’s in-store experience not typical? (Should have the Geeks to the house for the TV)


Have a job to fill? Seeking a position? Free listings available to match our Readers with the right opportunities. Email Editor Donna.


Read Telehealth and Telecare Aware: http://telecareaware.com/  @telecareaware

Follow our pages on LinkedIn and on Facebook

We thank our present and past advertisers and supporters: Tynetec, Eldercare, UK Telehealthcare, NYeC, PCHAlliance, ATA, The King’s Fund, HIMSS, Health 2.0 NYC, MedStartr, Parks Associates, and HealthIMPACT.

Reach international leaders in health tech by advertising your company or event/conference in TTA–contact Donna for more information on how we help and who we reach. See our advert information here. 


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

– – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – –

Comings and goings: CVS-Aetna finalizing, Anthem sued over merger, top changes at IBM Watson Health

What better way to introduce this new feature than with a picture of a Raymond Loewy-designed 1947 Studebaker Starlight Coupe, where wags of the time joked that you couldn’t tell whether it was coming or going?

Is it the turkey or the stuffing? In any case, it will be the place you’ll be going for the Pepto. The CVS-Aetna merger, CVS says, will close by Thanksgiving. This is despite various objections floated by California’s insurance commissioner, New York’s financial services superintendent, and the advocacy group Consumers Union. CEO Larry Merlo is confident that all three can be dealt with rapidly, with thumbs up from 23 of the 28 states needed and is close to getting the remaining five including resolving California and NY. The Q3 earnings call was buoyant, with CVS exceeding their projected overall revenue with $47.3 billion. up 2.4% or $1.1 billion from the same quarter in 2017. The divestiture of Aetna’s Medicare Part D prescription drug plans to WellCare, helpful in speeding the approvals, will not take effect until 2020. Healthcare Dive speculates, as we did, that a merged CVS-Aetna will be expanding MinuteClinics to create urgent care facilities where it makes sense–it is not a big lift. And they will get into this far sooner than Amazon. which will split its ‘second headquarters’ among the warehouses and apartment buildings of Long Island City and the office towers of Crystal City VA.

Whatever happened to the Delaware Chancery Court battle between Anthem and Cigna? Surprisingly, no news from Wilmington, but that didn’t stop Anthem shareholder Henry Bittmann from suing both companies this week in Marion (Indiana) Superior Court. The basis of the suit is Anthem’s willfully going ahead with the attempted merger despite having member plans under the Blue Cross Blue Shield Association meant the merger was doomed to fail, and they intended all along for “Anthem to swallow, and then sideline, Cigna to eliminate a competitor, in violation of the antitrust laws.” On top of this, both companies hated each other. A match made in hell. Cigna has moved on with its money and bought Express Scripts.

IBM Watson Health division head Deborah DiSanzo departs, to no one’s surprise. Healthcare IT News received a confirmation from IBM that Ms. DiSanzo will be joining IBM Cognitive Solutions’ strategy team, though no capacity or title was stated. She was hired from Philips to lead the division through some high profile years, starting her tenure along with the splashy new Cambridge HQ in 2015, but setbacks mounted later as their massive data crunching and compilation was outflanked by machine learning, other AI methodologies, and blockchain. According to an article in STAT+ (subscription needed), they didn’t get the glitches in their patient record language processing software fixed in ‘Project Josephine’, and that was it for her. High profile partner departures in the past year such as MD Anderson Cancer Centers, troubles and lack of growth at acquired companies, topped by the damning IEEE Spectrum and Der Spiegel articles, made it not if, but when. No announcement yet of a successor.

Cigna’s $69 million acquisition of Express Scripts clears US Department of Justice hurdle

As reported on 8 Sept, the DOJ announced on Monday that they have formally cleared the Cigna acquisition of pharmacy benefits manager Express Scripts. This puts together a major payer with a PBM manager, the latter area considered to be challenged for profitability as the PBM drug rebate model may be substantially less profitable in the future. Federal policy pressure is ramping up from Health & Human Services (HHS), with Secretary Alex Azar only last week promising disruptive change and more transparency in drug pricing.

CVS (PBM-Caremark) with Aetna is in the works and Anthem is creating its own PBM called IngenioRx. UnitedHealthcare has its own OptumRx for some years. 

Another point of pressure on the entire PBM category is the Amazon-Berkshire Hathaway-JP Morgan combine, sometime in the future when the hype and speculation on What Amazon Will Do turns into actual plans beyond their acquisition of tiny, specialized player PillPack for an exorbitant $1bn [TTA 4 July]. 

The DOJ investigation took six months, reviewed more than 2 million documents, and more than 100 industry people were interviewed.

Cigna and Express Scripts now must negotiate over 50 state departments of banking and insurance–over 50 because some states have two. Both companies already have shareholder approval, and the lack of overlap in their businesses limits the possibility of divestitures. Their advocacy website is here. But state DOBIs can be unpredictable, as Cigna found out with Anthem. (Their contentious breakup is still being contested in court–and Cigna could use the contractual breakup money to ease the Express Scripts debt estimated at $15 bn. Forbes.  Bloomberg, Healthcare Dive

Department of Justice won’t challenge CVS-Aetna merger: report

DOJ, stay away from our doors! The $69 bn CVS Health and Aetna mega-merger looks like it will go sailing down that river, if Mr. Market is right. Shares in both companies enjoyed a nice bump on today’s report that the DOJ won’t challenge this merger. The local Hartford Courant is relieved that Aetna plans to stay in their longtime HQ city (since 1853), conveniently omitting their long-standing plan to set up a big shop in NYC. CNBC

What a difference from a year ago when two mega-mega-mergers, Aetna-Humana and Anthem-Cigna, were shot d0wn–nay, riddled with bullets–in the Senate and in two courts [TTA 9 Feb 17]. Cigna is still living with the hangover of their bad breakup with Anthem, with a fight over a nearly $1.9 bn breakup fee [TTA 17 May 17] continuing in the Delaware Chancery Court in 2019.  Cigna nixed any other insurers in a horizontal merger and sought out Express Scripts, a pharmacy benefits manager (PBM) which was reeling a bit after its largest client (coincidentally) Anthem departed. Anthem sued its PBM, Express Scripts, for $15 billion, alleging the PBM overcharged it by $3 billion annually The merger will cost them over $550 million in transaction cost and that is just the beginning. That $1.9 bn would sure come in handy. Modern Healthcare 

Breached healthcare records down 72% but incident numbers steady. Then there’s MyFitnessPal’s 150 million…

[grow_thumb image=”http://telecareaware.com/wp-content/uploads/2015/02/Hackermania.jpg” thumb_width=”150″ /]Hackermania in healthcare may be running less wild…but what about consumer health devices? Year-end and top-of-year analyses indicate that the flood of breached records may be starting to drain. A Bitglass analysis of 2017 US Department of Health and Human Services (HHS) data from its infamous ‘Wall of Shame’ is encouraging. They found that the number of breached records decreased over the 2015-2017 period by 72 percent between 2015 and 2017 and by 95 percent from 2016. The calculation excludes the huge spike in breaches due to two 2015 incidents at Anthem and Premera Blue Cross [TTA 9 Sep 15]. Numerically, the breach incident numbers decreased but are relatively steady: 2017 at 294, 2016 at 328. Data security company Protenus in its tracking found more incidents in 2017 versus 2016 (477 in 2017 v. 450 in 2016) but the same reduction in records affected, with five times fewer records in 2017 versus 2016’s 27.3 million records.

What’s been successful has been reducing mega-breaches and containment of healthcare device loss and theft through education and enforcement of employee practices. What continues is the major cause of breaches continue to be insider-related via error and wrongdoing; this includes the major annual Verizon report. Healthcare Informatics

Protenus’ February report, while continuing the reduction trend, had its share of hacking and insider incidents. Of the 39 incidents in their report affecting over 348,000 records, insider actions such as the misuse of system credentials accounted for 51 percent of breached records while hacks were 46 percent, with the majority involving ransomware or malware. Hacking as a cause hasn’t disappeared but perhaps has shifted to easier targets.

UnderArmour’s MyFitnessPal delivers another breach blow. Late last month, the company revealed that 150 million user records were hacked in February. The MyFitnessPal mobile app (more…)

CVS’ bid for Aetna–will it happen, and kick off a trend? (updated)

We have scant facts about the reported bid of US drugstore giant CVS to purchase insurance giant Aetna for a tidy sum of $200 per share, or $66 billion plus. This may have been in development for weeks or months, but wisely the sides are keeping mum. According to FOX Business, “an Aetna spokesperson declined to chime in on the reports, saying the company doesn’t “comment on rumors or speculation” and to Drug Store News, a CVS Health spokesperson did the same. Aetna’s current market cap is $53 billion, so it’s a great deal for shareholders if it does happen.

Both parties have sound reasons to consider a merger:

  • CVS, like all retailers, is suffering from the Amazon Effect at its retail stores
  • Retail mergers are done with the Walgreens Boots AllianceRite Aid merger going through considerable difficulties until approved last month
  • The US DOJ and Congress has signaled its disapproval of any major payer merger (see the dragged-out drama of Aetna-Humana)
  • It has reportedly had problems with its pharmacy benefit management (PBM) arm from insurers like Optum (United HealthCare), and only last week announced that it was forming a PBM with another giant, Anthem, called IngenioRx (which to Forbes is a reason why this merger won’t happen–this Editor calls it ‘hedging one’s bets’ or ‘leverage’)
  • Aetna was hard hit by the (un)Affordable Care Act (ACA), and in May announced its complete exit from individual care plans by next year. Losses were $700 million between 2014 and 2016, with over $200 million in 2017 estimated (and this is prior to the Trump Administration’s ending of subsidies).
  • It’s a neat redesign of the payer/provider system. This would create an end-to-end system: insurance coverage from Aetna, CVS’ Minute Clinics delivering care onsite, integrated PBM, retail delivery of care, pharmaceuticals, and medical supplies–plus relationships with many hospital providers (see list here)–this Editor is the first to note this CVS relationship with providers.

We will be in for more regulatory drama, of course–and plenty of competitor reaction. Can we look forward to others such as:

  • Walgreens Boots with Anthem or Cigna (currently at each others’ throats in Delaware court
  • Other specialized, Medicare Advantage/Medicare/Medicaid networks such as Humana or WellCare?
  • Will supermarkets, also big retail pharmacy providers, get into the act? Publix, Wegmans, Shop Rite or Ahold (Stop & Shop, Giant) buying regionals or specialty insurers like the above, a Blue or two, Oscar, Clover, Bright Health….or seeking alliances?
  • And then, there’s Amazon and Whole Foods….no pharmacy in-house at Whole Foods, but talk about a delivery system?

Also Chicago Tribune, MedCityNews.

UPDATED. In seeking an update for the Anthem-Cigna ‘Who Shot John’ court action about breakup fees (there isn’t yet), this Editor came across a must-read analysis in Health Affairs 

(more…)

It’s all hackable by Black Hats: pacemakers, Amazon Echo, trains, heart monitors, prison cells!

It’s the servers, stupid! Unlike the economy, where people comprehended the problem, it seems we are automating more and securing less. The annual Black Hat Conference, where participants see this as a challenge, and the news are serving up some prime examples.

In Las Vegas, Lucas Lundgren, a senior security consultant at IOActive, scanned away–and was able to open prison doors, gain access to alarm systems, an oil pipeline, a German train controller, pacemakers, heart monitors, and insulin pumps. These communicate with servers through an open-source messaging protocol known as MQTT used in home and industrial systems. The problem is that access to the servers is not protected through a user name and password, much less two-factor authentication. “Not only can we read the data — that’s bad enough — but we can also write to the data.” Scary when you contemplate a hospital with insulin pumps, BP monitors, and multiple surgical devices all going haywire.  ZDNet 

Similarly, easy hacking pickings have turned up in IoT cameras–over 175,000 inexpensive cams made by Chinese manufacturer Shenzhen Neo Electronics’ as NeoCoolCam and distributed worldwide, discovered by BitDefender. Older Amazon Echo devices can be physically tampered with and malware uploaded to be turned into listening devices, according to MWR InfoSecurity.

And Anthem gets no respect. After suffering its 2015 data breach of 80 million members–and spending $115 million to settle the lawsuit–there’s a third-party contractor, LaunchPoint Ventures, who decided that no one would notice if 18,500 patient records were sent to a home email a year ago. Actually, it was noticed after the contractor was nabbed for unrelated “identity theft-related activities” this past April. More ‘splainin’ to do to HHS, surely, after filing their July 24 report. At least it’s not an IoT breach! Healthcare Dive

The End or Beginning? Anthem ends Cigna merger, won’t pay breakup fee, seeks damages (updated)

[grow_thumb image=”http://telecareaware.com/wp-content/uploads/2017/05/The-End-Pic-typewriter.jpg” thumb_width=”175″ /]Updated. Anthem on Friday 12 May beat Delaware Chancery Court’s Judge Travis Laster’s ticking clock [TTA 11 May], and finally, formally called off its merger with Cigna. Instead of sighs of relief and seeking oblivion in a few bottles of adult beverages, Anthem still won’t stop and let Cigna go. Anthem now refuses to pay the breakup fee per their agreement, claiming once again that Cigna sabotaged the merger, and wants blood from that rock. From the Anthem announcement:

In light of yesterday’s decision and Cigna’s refusal to support the merger, however, Anthem has delivered to Cigna a notice terminating the Merger Agreement. Cigna has failed to perform and comply in all material respects with its contractual obligations. As a result, Cigna is not entitled to a termination fee. On the contrary, Cigna’s repeated willful breaches of the Merger Agreement and its successful sabotage of the transaction has caused Anthem to suffer massive damages, claims which Anthem intends to vigorously pursue against Cigna. (Editor’s highlight)

Now we have Anthem seeking damages from Cigna, which is a matched set with Cigna’s Funny Valentine of 14 February adding over $13 bn in damages to recoup the unrealized premium that shareholders did not earn as a result of the merger failure. Anticipating Anthem’s position even at that time, they flipped a wicked backhand in their statement:

Anthem contracted for and assumed full responsibility to lead the federal and state regulatory approval process, as well as the litigation strategy, under the merger agreement. Cigna fulfilled all of its contractual obligations and fully cooperated with Anthem throughout the approval process.

Our Readers will also recall that in March, Cigna joined with Anthem in supporting Anthem’s appeal to the DC Court of Appeals, an unusual move in this light, but one that further reinforced their non-saboteur ‘we’re just innocent victims here’ position. Cigna has not yet publicly responded. The AMA cheered its apparent complete victory in the name of doctors and patients.

They hate each other and have from the start. The real victims here are the policyholders–patients–of both companies, with both companies distracted by a legal battle. How different they are from both Aetna and Humana, which (at least publicly) politely ended all efforts after the merger denial, paid out their breakup, and went back to business, which right now presents challenges with ACA hitting the long-predicted Actuarial Brick Wall. (Aetna exiting ACA individual exchange plans in 2018)

Judge Laster’s plans for a restful summer on Delaware’s beautiful beaches and bays are likely to have gone the way of the mouse in Robert Burns’ poem ‘To A Mouse’ (stanza 7). He is not alone in Indianapolis or Bloomfield, Connecticut:

But Mousie, thou art no thy-lane,
In proving foresight may be vain:
The best laid schemes o’ Mice an’ Men
Gang aft agley,
An’ lea’e us nought but grief an’ pain,
For promis’d joy!

See you in court! Fortune, Modern Healthcare, Healthcare DiveInterested in the previous details? See our coverage here, including our take on ‘whither the policyholders (patients) and corporate buyers’.

Anthem-Cigna breaking: lawyers may talk, but Cigna gets to walk–and it continues in court

[grow_thumb image=”http://telecareaware.com/wp-content/uploads/2017/05/The-End-Pic-typewriter.jpg” thumb_width=”175″ /]Breaking, with a whimper. This evening (11 May), the Delaware Court of Chancery released its ruling denying a 60-day injunction requested by Anthem to prevent Cigna from ending their merger. The original merger agreement had an end date of April 30. Judge Travis Laster stayed the implementation of his ruling until Monday noon to give Anthem a chance to appeal to the Delaware Supreme Court. Reuters

Is this The End? In this Editor’s opinion, yes, the petition to the US Supreme Court for a writ of certiorari notwithstanding. I stand by my Monday observation that “the Chancery Court decision to extend for 60 days–into July– is critical to any SCOTUS hearing, as it is unlikely there would be any merit in a review of a dead deal even if there is a potentially novel issue. 

So Cigna can walk, pass ‘go’ and collect…? The open issue is now Cigna’s. There is a contractually mandated breakup fee of $1.85 bn. In February, their Funny Valentine also claimed over $13 bn in damages, on the grounds that Anthem had intent to harm Cigna’s business. Not so fast though–there will certainly be a fight over the damages. According to Bloomberg, “the judge said there was significant evidence Cigna may have violated the merger agreement by dragging its feet on antitrust concerns, which could entitle Anthem to “potentially massive damages.” The next phase of court actions will be around damages awarded to Cigna, if any; if so how much; and what is the final settlement. Dirty laundry and ‘Who Shot John?’ will fly in this same court, unless the settlement is quick and quiet, highly unlikely with these two noisy protagonists. If it remains substantial, Cigna could be shopping for acquisitions–or be a cash-rich acquisition target itself. More distractions for management.

Other mergers may be more palatable in a changing healthcare landscape…just not this one. Also Fortune. Interested in the previous details? See our coverage here, including our take on ‘whither the policyholders (patients) and corporate buyers’.

Better than ‘Dallas’? Anthem and Cigna in Delaware court (updated); Anthem’s SCOTUS appeal

[grow_thumb image=”http://telecareaware.com/wp-content/uploads/2017/05/sj8qohs2yc6xbxpx1bmm.jpg” thumb_width=”150″ /]The War of the Payers grinds on. It’s altogether appropriate that this is the 100th anniversary of the US entry into the Great War. It was marked by a costly strategy that stalemated in the trenches and fatally ground into dust over four years men, machines, national treasuries, and ultimately a world order. In this Editor’s view, we are witnessing it writ large in Anthem’s, and to a lesser extent Cigna’s, actions after their merger was put paid to, first by a DC Federal District, then a District Appeals court, in a suit brought by the Department of Justice (DOJ) and 11 states.

Update: In Delaware Chancery Court May 8, Anthem requested a 60-day preliminary injunction to prevent Cigna from ending their merger. This was in a hearing on the February restraining order that Anthem received to block Cigna’s exit, filed in that court, from the merger after the District Court decision. Vice Chancellor Travis Laster said (after five hours of argument) that he would rule as soon as possible. Reuters  New: Even Judge Laster admits it’s a ‘long shot’ that Aetna could find a path to success after two courts turned down the merger. Cigna’s legal spokesperson further amplified that, stating that it was ‘a near impossibility’ and that no “divestiture package would have solved” the merger’s problems. Bloomberg  See the back story below

Watch for fireworks whatever the decision. Antitrust lawyer David Balto rated its potential “more fun than watching an episode of [the television melodrama] Dallas“. CT Mirror

The Chancery Court action is far more important than Anthem’s ‘petition for writ of certiorari’ to the Supreme Court of the US (SCOTUS) for review of the lower court ruling, citing the following:

  1. The 2 to 1 split in the court decision
  2. That the 1960s court precedents relied on by the District Court must be updated to today’s understandings of economics and consumer benefit
  3. And asserting that the loss of the merger “would limit access to high quality affordable care for millions of Americans and deny them more than $2 billion in medical cost savings annually” from the improved bargaining power of the new entity

(What perhaps was not included was that the merger partner, Cigna, wants out, out, out of the merger, which does tend to put a negative cast on the whole affair, as it did for the DC District Court.)

This Editor believes that the Chancery Court decision to extend for 60 days–into July– is critical to any SCOTUS hearing, as it is unlikely there would be any merit in a review of a dead deal even if there is a potentially novel issue. In the Reuters report, Anthem’s attorney mentioned the SCOTUS petition with a decision date by early July (the end of the term). He confirmed their intent to appeal to the DOJ for a ‘negotiation’ once the Trump Administration had its nominated officials in place. In Bloomberg, Cigna’s attorney’s position is that SCOTUS wouldn’t even consider the petition until September, which would put it past the extension and a decision into the next term.

Petitions for writ of certiorari are the Hail Mary pass–the last-ditch move–of court actions. (more…)

Anthem to Cigna: This merger is on, despite the appeals court decision, but the clock is ticking

[grow_thumb image=”http://telecareaware.com/wp-content/uploads/2016/04/Yak_52__G-CBSS_FLAT_SPIN.jpg” thumb_width=”150″ /]The War of the Payers continues.

Update: The DC Court of Appeals released its decision Friday 28 April to deny the Anthem-Cigna merger, upholding the District Court’s decision. This was a 2 to 1 vote that was issued immediately prior to the 30 April merger expiration. It cited that the savings would not mitigate the anti-competitive effects in the national, large group, and local markets, mainly in Medicare Advantage. What has been under-reported is that 11 states plus DC originally joined with the DOJ to enjoin (stop) the merger. In the US system, any healthcare merger also has to be approved by the states, and this merger was a failure in this area. Remarkably, even the dissenting judge cited problems with hospitals and doctors due to the combined company’s negotiating power.

In any rational business deal, this would be the final nail in the coffin, especially with one of the merger partners already wanting to leave. Unless Anthem wants to appeal to the US Supreme Court, this merger has reached The End of the Line. Yet publicly Anthem is pursuing, at least for the time being. In a statement, Anthem expressed “We are committed to completing the transaction and are currently reviewing the opinion and will carefully evaluate our options.”  Court decision in full. Healthcare Dive. MedCityNews.

To recap other recent developments: In February, the two insurers were filing and counter-filing each other in Delaware Chancery Court–Cigna to end their merger, Anthem to continue. Last Wednesday (19 April), Anthem filed an injunction to prevent the deal from expiring as per the merger agreement on 30 April. This injunction may be heard by the Chancery Court on 8 May, according to Anthem documents, but the main court documents are still under seal. (Law 360, via Healthcare Dive 24 April)

In prior Federal court actions, the Federal District Court in DC, based on action by the US Department of Justice, first denied the merger on 8 February on antitrust and anti-competitive grounds [TTA 9 Feb]. Unlike the also denied Aetna-Humana merger, it was publicly known, to the point where it was cited in the District Court decision, that the companies had significant disagreements on the merger. After the denial, Anthem wasted no time in appealing for a reversal of the decision with the DC Court of Appeals. Cigna lost no time in initially wanting no part of any appeal of the ruling by Anthem–and filed in Delaware Chancery Court for $13 bn in damages in addition to the contractual breakup fee of $1.85 bn [TTA 14 Feb]. Two days later, Anthem filed in the same court for an injunction to delay the merger agreement’s legal termination [TTA 16 Feb]. In March, Cigna surprisingly filed a brief in support of Anthem’s appeal (Healthcare Dive). Anthem has also denied rumors of an appeal to the Justice Department to save the merger (Reuters), which is now moot if it ever existed.

As the clock winds down, there remain rivers of bad blood and accusations of bad faith between these two organizations which will continue to be fought in court. Was this merger ever really necessary? No, and it never was, and in our 16 February/21 February update (see analysis), this Editor opines on why Anthem’s to-date persistence in pursuing this has been extraordinarily harmful–to their customers and to both companies.

HIMSS17 dispatches: Mayo maps neonate telemedicine, Amwell-Samsung, Samsung-T-Mobile

Mayo maps out an enterprise telehealth (telemedicine) support structure. Here’s how the Mayo Clinic deployed neonatology remote telemedicine to their sites in Minnesota, Arizona, and Florida. There’s plenty of flow charts and summary points in this presentation deck around team building, staffing consistently and reporting that improves processes. Hat tip to our HIMSS correspondent on the scene, Bill Oravecz of Stone Health Innovations. Update: If you are using Chrome, you may have difficulty downloading session handouts from the HIMSS17 website Schedule pages. Try another browser. If you are interested, you may be able to obtain through contacting the two session presenters, Susan Kapraun and Jenna A. Beck, MHA, directly.

American Well and Samsung are partnering on integrating care delivery. Their joint release is low on details, but towards the end there’s an indication that American Well, its partners, and other providers and payers will be able to offer their services to Samsung customers. Other reports (Healthcare Dive) indicate the partnership is destined to enhance Amwell’s Exchange platform between payers and providers. Partners listed are Cleveland Clinic, New York-Presbyterian Medical Center and Anthem (undoubtedly resting after sparring with Cigna). Also Healthcare IT News.

Separately, Samsung also announced a partnership with T-Mobile for developing IoT in the senior care space. This would pair Samsung’s ARTIK Cloud with T-Mobile’s cellular network for Breezie, a social engagement for seniors interface built on a Samsung tablet which has apps and connects to various peripherals for post-acute care and daily living. It sounds interesting, but once again the release hampers the reporter by being as clear as mud in what it’s all about. See if you can decipher this: ARTIK Cloud permits “Amazon Alexa, Samsung SmartThings, iHealth Feel Wireless Blood Pressure Monitor and the Pulse Oximeter – to intelligently communicate with each other.” “Each Breezie interface has more than 40 preconfigured accessibility settings and sensor driven analytics to adjust for different levels of digital literacy, as well as physical and cognitive ability.” The Breezie website is far more revealing. Healthcare Dive also takes a whack at it towards the end of the above article.

Anthem to Cigna: That’s Sabotage! You’re staying, like it or not! (updated 21 Feb)

Breaking News in The War of the Payers. Late on Wednesday (15 Feb), Anthem received a temporary restraining order to block Cigna from terminating the merger. Judge Travis Laster’s decision in the Delaware Court of Chancery maintains the “legal status quo’ until an April 10 hearing, where he will hear arguments from both sides. Anthem is now able to proceed with a fast-tracked appeal in the DC Federal Court of Appeals to overturn the February 8 DC District Federal Court decision that denied the merger. The sole extension in the merger agreement is to April 30, which will be preceded by the Chancery Court hearing 20 days prior. Bloomberg, WSJ (via 4-traders.com)

Wednesday morning, Anthem had filed a temporary restraining order in Chancery Court to keep Cigna from ankling the merger, which would make an appeal moot. It was positioned in their February 15 release as “a temporary restraining order to enjoin Cigna from terminating, and taking any action contrary to the terms of, the Merger Agreement, specific performance compelling Cigna to comply with the Merger Agreement and damages.” Cigna wanted out immediately, as we noted on Feb 14, seeing no hope in challenging the District of Columbia Federal District Court ruling as Anthem does, and took the position that the extension was invalid. They also sought an additional $13 billion in damages for shareholders beyond the $1.85 billion breakup fee.

The language Anthem used in Wednesday’s release to justify the filing was harsh: “…Cigna does not have a right to terminate the Merger Agreement at all because it has failed to perform fully its obligations in a manner that has proximately caused or resulted in the failure of the merger to have been consummated.” Anthem then accused Cigna of actively working to sabotage the merger: “Cigna’s lawsuit and purported termination is the next step in Cigna’s campaign to sabotage the merger and to try to deflect attention from its repeated willful breaches of the Merger Agreement in support of such effort.”Also Forbes

Bottom line: ‘Cigna, you’re a bad and faithless partner, but we are going to force a merger by any means possible anyway.’ Cigna blames Anthem for botching the merger approvals. Does prolonging any of this make sense?

Updated 21 Feb The differences started at the very beginning, with C-level disputes on who would lead a merged company and other areas of governance, so obvious (and public) they were cited by DC Federal District Judge Amy Berman Jackson’s Feb. 8 decision. David Balto, an antitrust lawyer in Washington, dubbed it ‘a shotgun marriage that went sour’ and not to discount Cigna’s case for damages due to business harm. After reading this article, you’ll wonder why they even started. Hartford Courant

Analysis Any merger between Anthem and Cigna has become, despite the language, a hostile takeover, worthy of Frank Lorenzo in this Editor’s airline days, or more recently, Carl Icahn. Having worked for Mr Lorenzo years ago, observing from my tiny chair way over on the sidelines, I learned that hostile takeovers and poorly thought-out mergers don’t work out well, in service delivery or economics, short or long term. They usually end badly, in bankruptcy court, with many tears shed and lives wrecked.

Memo to Anthem and Cigna–is this really necessary? Here we are dealing with insurance, and service to policyholders/members, affecting both their health and wealth. You both talk a good game about saving on medical costs, accelerating the progress of value-based care, delivering value to shareholders, and improving quality. But you hate each other and have from the start. Playing the game of Who Blinks First, and the distraction of a long and bitter legal battle, cannot be anything other than harmful to your members, employees, doctor and health system providers, your bottom lines, and your future.

This is not the airline business, beverages or detergent. It’s people’s lives here–have you both forgotten? Enough! Stop now! Get back to the business of healthcare!

Previously and related in TTA: Cigna to Anthem: we’re calling it off too, Aetna’s Bertolini to Humana: let’s call the whole thing off, Anthem-Cigna merger nixed

Cigna to Anthem: we’re calling it off too–and we want $13 bn in damages!

Breaking News  Not quite so tuneful or amicable is today’s other Funny Valentine, which is now in Divorce Court. Cigna officially wants out, out, out of its merger with Anthem in a big, big, big way. In addition to the contractual breakup fee of $1.85 bn, Cigna is suing for additional damages exceeding $13 bn.

The action versus Anthem in the Delaware Court of Chancery seeks to lawfully terminate the merger (already denied in the DC District Court, TTA 9 Feb) and to stop Anthem’s current move to extend the agreement to 30 April. The additional $13 bn in damages would recoup the unrealized premium that shareholders did not earn as a result of the merger failure.

Anthem stated last week following the District Court decision’s release that it would appeal. Healthcare Dive reported that filing took place yesterday in the District of Columbia Federal Court of Appeals.

The Cigna release is intriguing for its careful air-clearing and positioning. In their view, the merger “had the potential to expand choice, improve affordability and quality and further accelerate value-based care”. Then a wicked backhand to Anthem: “Anthem contracted for and assumed full responsibility to lead the federal and state regulatory approval process, as well as the litigation strategy, under the merger agreement. Cigna fulfilled all of its contractual obligations and fully cooperated with Anthem throughout the approval process.’

Financially, Cigna stresses its positive outlook of 12 to 18 percent growth and ‘significant capital available for deployment’, as well as touting that their “approach of focusing on health care services over sick care financing has never been more critical.” There is also an updated statement about their share repurchasing authority: “Cigna is also announcing that its Board of Directors has expanded the company’s share repurchase authority to an aggregate amount of $3.7 billion. Management has determined that it is prudent to cap the amount of the repurchase to $250 million per quarter until there is more clarity with respect to the litigation with Anthem.”

No press response yet from Anthem. Stay tuned. Also CNBC

Earlier today: Aetna’s Bertolini to Humana: Let’s call the whole thing off

Updated: Aetna’s Bertolini to Humana: Let’s call the whole thing off.

Updated–Humana exits individual exchange policy markets

Breaking News On this Valentine’s Day, a Romance Gone Flat. This morning, both Aetna and Humana formally announced the end of their merger, ruling out any appeal of the Federal District Court decision against it last month [TTA 24 Jan]. While positioned as a mutual agreement, Aetna CEO Mark Bertolini took the key quote in the release: “While we continue to believe that a combined company would create greater value for health care consumers through improved affordability and quality, the current environment makes it too challenging to continue pursuing the transaction. We are disappointed to take this course of action after 19 months of planning, but both companies need to move forward with their respective strategies in order to continue to meet member expectations. Our mutual respect for our companies’ capabilities has grown throughout this process, and we remain committed to a shared goal of helping drive the shift to a consumer-centric health care system.”

Humana’s release limited the announcement to one line and briskly moved on to what really counts–the financials. They will receive a breakup payment of $1 bn (after taxes, $630 million) from Aetna, with their 2017 financial guidance call/release taking place after 4pm EST today. Molina Healthcare, which was to receive certain Aetna Medicare Advantage assets from Aetna post-merger to relieve an over-dominance in some markets, will also receive an undisclosed termination fee. Ka-ching! CNBC, Hartford Courant (Aetna’s hometown paper)

UPDATED 2/14-16 Humana’s financial release announced an updated strategy, share repurchases, a nicely increased dividend–and, buried in the release, their exit effective 2018 from the ‘individual commercial’ business, which are individual policies offered in 11 states through the ACA-created Federal Marketplaces, citing an ‘unbalanced risk pool’ and losses estimated at $45 million for FY17. (By 2018, it may be a moot point.) It is ironic that Aetna’s exit from exchange policies due to unprofitability (or not, as it turned out to be in a few cases) proved to be one of the many bricks that broke the merger, in Judge Bates’ view. The truth is that Aetna and Humana are hardly alone in fleeing the exchanges, and that they have turned out to be unprofitable, as predicted.

[grow_thumb image=”http://telecareaware.com/wp-content/uploads/2017/02/aetna-tweet.jpg” thumb_width=”250″ /]Consistent with their behavior over the 19 months of the proposed merger, both Aetna and Humana are publicly respectful, unlike….

These other two will never be one, something must be done? The demise of the Anthem-Cigna merger [TTA 9 Feb], now breaking up in Delaware Chancery Court, may mean a period of Payer Merger Quiet. Does this mean a refocusing on benefiting corporate and individual policyholders during the certain changes to come? Aetna may also proceed with a plan to move operations to Boston, which may affect hundreds of jobs, but has pledged to keep a presence in Hartford according to the Hartford Courant. Humana continues to be interested in investment opportunities and, from reports, another merger.

Goodness knows what the end will be! (Hat tip to Ira Gershwin for the title and the interpolated lyrics!)