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.

Comings and goings: Cuts hit Athenahealth, IBM Watson’s Drug Discovery unit; Bain may sell Waystar RCM

Athenahealth has announced they are trimming 4 percent of their total workforce. With a large 900-person campus in Belfast, Maine that once belonged to MBNA credit cards, and a workforce of about 5,000 headquartered in Watertown, Massachusetts, there is considerable local concern in an area of Maine that offers few well-paying jobs. Reportedly dozens of jobs there will be lost. This caps a tumultuous period with the company. Athenahealth was acquired last November by Veritas Capital and Evergreen Coast Capital, then merged with a GE Healthcare spinoff they owned, Virence Health, in value-based care, under the Athenahealth name. Bangor Daily News

IBM Watson’s Drug Discovery product, which was targeted to pharmaceutical companies, is being cut back to work with only current partners and with clinical trials due to poor sales. According to The Register, a tart-tongued UK tech website which actually reached an IBM spokesperson, IBM’s Ed Barbini stated that “We are not discontinuing our Watson for Drug Discovery offering, and we remain committed to its continued success for our clients currently using the technology.” Also Seeking Alpha. IBM Watson and Watson Health, like Athenahealth, are moving through a rocky period of closing initiatives (Watson Workplace), layoffs, executive departures (head Deborah DeSanzo last November), bad publicity, and clients like MD Anderson who don’t part quietly. [TTA 8 Nov 18].

Another merged health infotech company may have a new owner soon. Waystar, which was formed by the acquisition of ZirMed and Navicure in 2017 and manages revenue cycles for 450,000 practices, is rumored to be up for sale by owner Bain Capital. Interested parties include Visa and OracleBloomberg

CVS-Aetna, Cigna-Express Scripts reportedly on road to merger approval; Athenahealth in hostile takeover–or not (updated)

CVS’ pickup of Aetna, and Cigna‘s acquisition of Express Scripts are reported to be clearing the Department of Justice anti-trust review within the next few weeks, just in time for pumpkin season. The DOJ may have concerns on some assets related to Medicare drug coverage and may require a sell-off to resolve them. One potential buyer is WellCare Health Plans, which this week completed its acquisition of Meridian Health Plans and entered the S&P 500 on Monday. The Cigna-Express Scripts combine may not require any asset selloff. Seeking Alpha (report is from the Wall Street Journal).

The once blazingly hot Athenahealth is up for sale but can’t seem to get arrested by another healthcare company. Both Cerner and UnitedHealthcare passed on an acquisition. One of the larger shareholders, Elliot Management, initiated moves toward a hostile takeover in May, and in the process managed to oust founder and CEO Jonathan Bush on still-murky charges of past domestic abuse and workplace sexual harassment. Mr. Elliot is partnering with Bain Capital which owns Waystar, a revenue cycle management (RCM) company from the merged ZirMed and Navicure. Waystar could benefit from Athenahealth’s systems and IP. Mr. Bush would receive a relatively small sum in a sale –$4.8 million– with new executive chair and former GE CEO Jeffrey Immelt earning $150,000 a month in salary and $150,000 in restricted stock perhaps looking for a new job. Elliot’s reputation is that of a corporate raider–taking over businesses to strip assets and sell off the remains. New York Post, POLITICO Morning eHealth.

UPDATED 19 Sept Reports from yesterday indicate that Mr. Elliot has ‘balked’ at the $160 per share price that Athenahealth is asking, and may be angling for a lower price, according to the NY Post report. Reportedly no one else–Cerner and UnitedHealthcare–is interested, though Athenahealth has extended the bid deadline to 27 September. There may be problems uncovered by the due diligence. It’s also a recognized hardball lowball strategy to get the share price way down. The industry is betting on the latter because the former is difficult to contemplate for customers and healthcare as a whole. Also HealthcareITNews.

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.

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

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…)

Rounding up the funding rounds of 2015–and the deals some would like to see (?)

Mobihealthnews rounded up 2015’s hot funding in the mobile health/health tech-related space, with helpful links to their articles. They cite as we have previously [TTA 16 Dec] Rock Health‘s flattish year-to-year 2015 total of $4.3 bn, but also StartUp Health’s bloom-off-rose 2015 digital health total of $5.8 bn–larger than Rock Health’s tote, but 17 percent off their 2014 total of $7 bn. If you consider the proportions: the top 10 deals raised $738 million–$130 million alone to the endlessly funded but yet to take over the world ZocDoc –the roster below $20m remains the longest, which is completely in accord with the lower part of Rock Health’s pyramid of angel-A-B rounds.

Yet Aditi Pai’s detailed summary strikes this Editor as useful in an unanticipated way. There is a certain sameness in the products and services of these companies, as if funders are seeking validation in similarity. ZocDoc, DoctoLib and Vitals–doctor profiles and appointment booking. Sharecare, Welltok, Novu, Noom, AbilTo, SocialWellth, Health Recovery Solutions, Jiff–health and wellness engagement programs/apps, many for corporate programs. Whoop, Sano, Sproutling, TuringSensor, Valencell, Moff and four others–wearables. Hello, Sleepace, Sproutling (baby)–sleep tracking. Klara, SkinVision, Spruce–dermatology apps. Beyond the gloomy forecast for unicorns (Theranos being the Child on the Milk Carton), how many of these corporate wellness programs, sleep trackers and wearables will be around in 2017? Mobihealthnews’ 2015 funding roundup.

MedCityNews takes a lighter-hearted (I think) look at 2016 deals. IBM would buy athenahealth mainly for its EHR and practice management data, plus data aggregator Validic, to beef up Watson; 23andMe, past its two years of troubles after stepping on FDA Superman’s cape, would buy PatientsLikeMe (endangering its community shaped credibility? 23PatientsLikeMe?) and the best–Theranos bought by Boston Heart Diagnostics/Eurofin (EU lab testing giant), which would reduce this unicorn to a pony…but one that might make it. Theranos also made VentureBeat’s list of Likely Carcasses in the Valley of Unicorn Death (to quote the article’s author). Chris Seper’s Deals He’d Like To See.

Cerner acquires Siemens HIT business

The big news in HIT circles today was Cerner’s purchase of Siemens’ health IT business for $1.3 billion. Forbes has the most detailed analysis by far, which appears prepared in advance based on the 22 July rumor published by HISTalk at that time. HISTalk’s and their readers’ comments on the announcement conference call today are moderately scathing and worth reading if of interest to you. The takeaway for this Editor is that it was a defensive move for Cerner versus Epic Systems, Athenahealth and Allscripts; they bought out a competitor, bought market share with the acquisition (although how much of it would have fallen to them anyway is a question), gained more of an international foothold plus an inside track to customers eager to move to newer technology. For Siemens, it appears  (more…)

Epocrates ‘Bugs + Drugs’ infectious disease app inaccurate, should be pulled: reviewer

For clinicians who increasingly rely on major reference apps via smartphone and tablet, this sounds a loud cautionary note. This pharmacist’s detailed analysis of the errors and misinterpretation contained in the recently released and best-selling Epocrates reference app on the highly sensitive topic of infectious disease (including those that plague hospitals such as MRSA) culminates in a call to pull it from the Apple App Store. In several instances, the app pointed to the wrong antibiotic for an organism. The other faults are in using Athenahealth information to create what is called an antibiogram, “to identify what organisms are susceptible to what antibiotics in that locale”. The iMedicalApps analysis by Timothy Aungst, Pharm.D., professor at Massachusetts College of Pharmacy and Health Sciences has created quite a stir in the usual places. FierceMobileHealthcare covers this but decides to further blow up the balloon (or move off the point) in citing the IMS Institute for Healthcare Informatics and Journal of Cancer Education on the plain ineffectiveness and non-validation of the vast majority of healthcare apps–mainly consumer.