While telehealth virtual office visits flatten, overall up 300-fold; FCC finalizes COVID-19 telehealth funding program (US)

As expected, the trend of telehealth visits versus in-person is flattening as primary care offices and urgent care clinics reopen. Yet the overall trend is up through May–a dizzying 300-fold, as tracked by the new Epic Health Research Network (EHRN–yes, that Epic). Their analysis compares 15 March-8 May 2020 to the same dates in 2019 using data from 22 health systems in 17 states which cover seven million patients. It also constructs a visit diagnosis profile comparison, which leads with hypertension, hyperlipidemia, pain, and diabetes–with the 2020 addition of — unsurprisingly — anxiety.

POLITICO Future Pulse analyzed EHRN data into July (which was not located in a cross-check by this Editor) and came up with its usual ‘the cup has a hole in it’ observation: “TELEHEALTH BOOM BUST”. But that is absolutely in line with the Commonwealth Fund/Phreesia/Harvard study which as we noted tailed off as a percentage of total visits by 46 percent [TTA 1 July]. But even POLITICO’s gloomy headline can’t conceal that telehealth in the 37 healthcare systems surveyed was a flatline up to March and leveled off to slightly below the 2 million visit peak around 15 April. 

Where POLITICO’s gloom ‘n’ doom is useful is in the caution of why telehealth has fallen off, other than the obvious of offices reopening. There’s the post-mortem experience of smaller practices which paints an unflattering picture of unreadiness, rocky starts, and unaffordability:

  • Skype and FaceTime are not permanent solutions, as not HIPAA-compliant
  • New telehealth software can cost money. However, this Editor also knows from her business experience that population health software often has a HIPAA-compliant telehealth module which is relatively simple to use and is usually free.
  • It’s the training that costs, more in time than money. If the practice is in a value-based care model, that is done by market staff either from the management services organization (MSO) or the software provider.
  • Reimbursement. Even with CMS loosening requirements and coding, it moved so quickly that providers haven’t been reimbursed properly.
  • Equipment and broadband access. Patients, especially older patients, don’t all have smartphones or tablets. Not everyone has Wi-Fi or enough data–or that patient lives in a 2-bar area. Some practices aren’t on EHRs either.
  • Without RPM, accurate device integration, and an integrated tracking platform, F2F telehealth can only be a virtual visit without monitoring data.

Perhaps not wanting to paint a totally doomy picture (advertising sponsorship, perhaps?), the interview with Ed Lee, the head of Kaiser Permanente’s telehealth program, confirmed that the past few months were extraordinary for them, even with a decent telehealth base. “We were seeing somewhere around 18 percent of telehealth [visits] pre-covid. Around the height of it, we’re seeing 80 percent.” They also have pilots in place to put technology in the homes of those who need it, and realize its limitations.

Speaking of limitations, the Federal Communications Commission (FCC) COVID-19 Telehealth Program, authorized by the CARES Act, is over and out. The final tranche consisted of 25 applications for the remaining $10.73 million, with a final total of 539 funding applications up to the authorized $200 million. Applicants came from 47 states, Washington, DC, and Guam. FCC release. To no one’s surprise, 40 Congresscritters want to extend it as a ‘bold step’ but are first demanding that Chair Ajit Pai do handsprings and provide all sorts of information on the reimbursement program which does not provide upfront money but reimburses eligible expenditures. That will take a few months. You’d think they’d read a few things on the FCC website first. mHealth Intelligence

10 years in 2 months: prognosticating the longer-term effect of COVID-19 on telehealth, practices, and hospitals

crystal-ballThis Editor recounted last night in the article below on The TeleDentists’ fresh agreements with Cigna and Anthem the observation of a former associate who has been in the thick of the remote patient monitoring wars for some years that telehealth/telemedicine has progressed 10 years in 2 months. Seema Verma, the head of the Centers for Medicare and Medicaid Services (CMS), stated to the Wall Street Journal (paywalled),  “I think the genie’s out of the bottle on this one. I think it’s fair to say that the advent of telehealth has been just completely accelerated, that it’s taken this crisis to push us to a new frontier, but there’s absolutely no going back.” Even in a short period of time, CMS-reported telehealth visits as of 28 March trebled from 100,000 to 300,000. When the April numbers are in, it would not be surprising to see it grow well into seven figures.

The genie may be out of the bottle, but what will the genie do? Genies are, after all, unpredictable, and fly around.  Out of the smoke, some educated guesses:

  • Insecure, non-HIPAA compliant audio/video platforms will be the first which should be struck from CMS approval. Zoom has become a hackfest, with all sorts of alerts from mobile providers like Verizon on how to secure your phone. (An organization of which this Editor is a member had a panel this week completely disrupted by a hacker in five minutes.) Skype’s problems are well known. The winners here will be telehealth platforms that integrate well with EHRs, population health platforms (or may be part of population health platforms), and have robust security.
  • Primary care practices and specialists, who’ve been surviving on non-F2F visits, will be adjusting their practices to patient demand, and integrating telehealth with physical visits in a way that their patients will prefer. This means a search for integration of EMRs/EHRs with secure platforms and reconfiguring areas such as care coordination. If planned correctly, this could create better management of patients with multiple chronic conditions.
  • Actual physical visits will rebound, creating financial pressure on Medicare, hospitals, and private payers. How many people’s health has declined in two-three months is key. Small practices, who may see this first, will see another level of pressure, because they will be held to their Medicare quality metrics in value-based models even if adjusted. Hospitals will also rebound–if they are able. The dark side: private payers may run the numbers and scale back on benefits for the 2021 year especially if COVID is projected to make a return.
  • Behavioral health may benefit, yet drive individual practices and a wave of retirements, or a consolidation into clinic or group settings. There’s a reason why Optum is buying out AbleTo; we may see a wave of competitor acquisitions in this area with the emphasis will be on cognitive health and short courses. Why retirements? Many psychiatric practices are still independent, concentrated geographically, and the average psychiatrist is over 50. Psychiatric EHRs are both costly and not particularly suited to practices. If faced with technological challenges, a lot of MDs and senior clinical psychologists may very well exit–threatening clinics which need MDs to legally operate.
  • Rural health’s failure accelerated. USA Today’s analysis pinpointed at least 100 rural hospitals to close within the year. They already operated on thin margins, but with COVID expenses for additional equipment, the closing down of more profitable elective procedures and dependence on Medicaid, the over 1,100 unprofitable hospitals, over half of which are the only hospital in their county, have received a body blow. HHS allocated $10 billion to rural hospitals and clinics of the $100 billion aid package, but it may be too little and too late. Becker’s Hospital Review continues to track the bankruptcies and closures. Here there are no easy solutions from the digital health area.
  • A culture of cleanliness should accelerate. If the genie pulls this out of the bottle, one major benefit will be that hospital-acquired infections will decline. Effective sanitization methods that reduce human application and scrubbing will be the ones to look at: disinfecting foggers and UV full room or area systems–or combinations of same. Cleanliness and lack of virii and bacteria may become a new metric. Look and bet on companies that can provide this, from rooms to computers/mobile tablets and phones.

Readers can help with these prognostications and especially how they will play out not only in the US, but also in the UK, Europe, and worldwide.

Tyto Care telehealth diagnostics raises $50 million in venture round

Tyto Care today (7 April) announced a venture round investment of $50 million by Insight Partners, Olive Tree Ventures, and Qualcomm Ventures LLC plus previous investors. The new investment will pay for commercialization throughout the US, Europe, and Asia as well as to introduce new advanced product capabilities including AI and machine learning-based home diagnostics solutions and other patented technologies. 

Tyto’s timing could not be better for the raise. In the US, led by CMS with private payers following in near lockstep, the past month has seen the rapid unrestricting of payment for telehealth services like virtual visits of the audio-visual type and short asynchronous and synchronous image and audio/telephonic short visits. Tyto’s remote medical exams of the lungs, heart, throat, ears, abdomen, and body temperature fits into the current and likely future need. Both live exams and asynchronous forwarding of data are part of a platform that integrates with EHRs and third party exam tools.

Tyto Care works with hundreds of hospitals and over 100 health organizations including health systems, payers and strategic partners, primarily in North America, Europe, and Israel. In 2019, they had over 200,000 examinations.

If, like your Editor, you believe that the tidal wave of telehealth has changed the office visit model for keeps, adding remote diagnostics can be a winner–if Tyto can navigate the tricky shoals of a largely consumer-based marketing strategy (Best Buy) and gain adoption by health systems and payers, as they have in Israel with Sheba Medical Center [TTA 28 Feb]. Release, FierceHealthcare

CMS clarifies telehealth policy expansion for Medicare in COVID-19 health emergency, including non-HIPAA compliant platforms (US)

Today (17 March), the Center for Medicare and Medicaid Services (CMS) issued a Fact Sheet and FAQs explaining how the expanded telehealth provisions under the Coronavirus Preparedness and Response Supplemental Appropriations Act and the temporary 1135 waiver will work. The main change is to (again) temporarily expand real-time audio/video telehealth consults in all areas of the country and in all settings. The intent is to maintain routine care of beneficiaries (patients), curb community spread of the virus through travel and in offices, limit spread to healthcare providers, and to keep vulnerable beneficiaries, or those with mild symptoms, at home. Usage is not limited to those who suspect or already are ill with COVID-19.

Previously, only practices in designated rural health areas were eligible for telehealth services, in addition to designated medical facilities (physician office, skilled nursing facility, hospital) where a patient would be furnished with a virtual visit. 

The key features of the 1135 telehealth waiver are (starting 6 March):

  • Interactive, real-time audio/video consults between the provider’s location (termed a ‘distant site’) anywhere in the US and the beneficiary (patient) at home will now be reimbursed. The patient will not be required to go to a designated medical facility.
  • Providers include physicians and certain non-physician practitioners such as nurse practitioners, physician assistants and certified nurse-midwives. Other providers such as licensed clinical social workers (LCSW) and nutritionists may furnish services within their scope of practice and consistent with Medicare benefit rules.
  • Surprisingly, there is ‘enforcement discretion’ on the requirement existing in the waiver that there be a prior relationship with the provider. CMS will not audit for claims during the emergency. (FAQ #7)
  • Even more surprisingly, the requirement that the audio/visual platform be HIPAA-compliant, as enforced by the HHS Office of Civil Rights (OCR), is also being waived for the duration (enforcement discretion again), which enables providers to use Apple FaceTime, Facebook Messenger video chat, Google Hangouts video, or Skype–but not public-facing platforms such as Facebook Live, Twitch, or TikTok. Telephones may be used as explicitly stated in the waiver in Section 1135(b) of the Social Security Act. (FAQ #8) More information on HHS’ emergency preparedness page and OCR’s Notification of Enforcement Discretion.
  • On reimbursement, “Medicare coinsurance and deductible would generally apply to these services. However, the HHS Office of Inspector General (OIG) is providing flexibility for healthcare providers to reduce or waive cost-sharing for telehealth visits paid by federal healthcare programs.”

Concerns for primary care practices of course are readiness for real-time audio/video consults, largely addressed by permitting telephones to be used, as well as Skype and FaceTime, and what services (routine care and COVID-19 diagnosis) will be offered to patients.

This significant expansion will remain in place until the end of the emergency (PHE) as determined by the Secretary of HHS.

In 2019, CMS also expanded telehealth in certain areas, such as Virtual Check-Ins, which are short (5-10 minute) patient-initiated communications with a healthcare practitioner which can be by phone or video/image exchange by the patient. This could be ideal for wound care where this Editor has observed, in one of her former companies, how old phones are utilized to send wound images to practices for an accurate ongoing evaluation via special software. E-Visits use online patient portals for asynchronous, non-face-to-face communications, initiated by the patient. These both require an established physician-patient relationship. Further details on both of these are in the Fact Sheet, the FAQs, and the HHS Emergency Preparedness page with links.

The American Medical Association issued a statement today approving of the policy changes, and encouraged private payers to also cover telehealth. The American Telemedicine Association didn’t expand upon its 5 March statement praising the passage of the Act but advocated for increased cross-state permission for telehealth consults.

Additional information at HISTalk today and Becker’s Hospital Review.

$8bn COVID-19 supplemental funding House bill waives telehealth restrictions for Medicare beneficiaries (US)

The House of Representatives, which controls appropriations, has passed H.R. 6074, the Coronavirus Preparedness and Response Supplemental Appropriations Act. The bill provides $8.3 billion in new funding that includes a significant telehealth waiver for Medicare. From the bill summary on Congress.gov:

Within the Department of Health and Human Services (HHS), the bill provides FY2020 supplemental appropriations for

the Food and Drug Administration,
the Centers for Diseases Control and Prevention,
the National Institutes of Health, and
the Public Health and Social Services Emergency Fund.

In addition, the bill provides supplemental appropriations for

the Small Business Administration,
the Department of State, and
the U.S. Agency for International Development

The supplemental appropriations are designated as emergency spending, which is exempt from discretionary spending limits.

The programs funded by the bill address issues such as

developing, manufacturing, and procuring vaccines and other medical supplies;
grants for state, local, and tribal public health agencies and organizations;
loans for affected small businesses;
evacuations and emergency preparedness activities at U.S. embassies and other State Department facilities; and
humanitarian assistance and support for health systems in the affected countries.

The bill also allows HHS to temporarily waive certain Medicare restrictions and requirements regarding telehealth services during the coronavirus public health emergency.

Sponsored by retiring Rep. Nita Lowey (D-NY), it was introduced and passed in the House 415-2.

In the text of the bill, the telehealth-pertinent portion permitting CMS to waive restrictions on telehealth for Medicare beneficiaries during this emergency is Division B, Sections 101-102. This cost is estimated at $500 million by The Hill.

The bill went to the Senate yesterday (4 Mar) for final approval. There is already an amendment proposed by Senator Rand Paul (R-KY) to offset the $8 bn of the bill with unobligated, non-health related foreign aid funds (FreedomWorks). Whether this is the ‘offset’ for telehealth that is mentioned in The Hill as under negotiation is not revealed.

The American Telemedicine Association (ATA) approved of the waiver. Ann Mond Johnson, the ATA’s CEO, urged “CMS to implement its waiver authority as soon as possible to ensure health care providers understand any requirements and help speed the deployment of virtual services” and pledged “The ATA and its members will continue to work with federal and state authorities, including HHS and the CDC, to address the COVID-19 outbreak and ensure resources are appropriately deployed for those individuals in need of care and help keep health care workers safe.” ATA press release, Hat tip to Gina Cella for the ATA heads-up

News roundup: Proteus may be no-teous, DOJ leads on Google-Fitbit, HHS’ mud fight, Leeds leading in health tech, malware miseries, comings and goings

Proteus stumbles hard, cuts back. The original ‘tattle-tale pill’ company, Proteus Digital Health, plans to lay off 292 people in the San Francisco Bay Area and to permanently close its three Redwood City and Hayward locations, starting 18 January, according to notices sent to California state and local offices, including the state employment development department. It is unclear where Proteus will be located after the closures.

This followed after Proteus failed to launch a twelfth funding round of $100 million. According to reports, they furloughed most of their employees for two weeks in November and are reorganizing. This is after a substantial number of investors have put in about $487M in funding through a Series H (Crunchbase), including a game-changing investment by Novartis dating back to 2010.  Proteus achieved unicorn status about three years ago, but its high-priced pill tracking technology with a pill sensor tracked by a skin-worn monitor reporting into a smartphone has a built-in limited market to expensive medication. Otsuka Pharmaceutical in 2017 partnered with Proteus for an FDA-cleared digital medicine system called Abilify MyCite that basically put an off-patent behavioral drug back into a more expensive tracking methodology. But Proteus remains a great idea on tracking compliance in search of a real market, and may not have much of a future. San Jose Mercury News, CNBC

But ingestible detectable pills are still being tested. On Monday, as Proteus’ bad news broke, eTectRx announced its FDA clearance of the ID-Cap System and its testing at Brigham and Women’s Hospital and Fenway Health, focusing on HIV medication when used for treatment and prevention. Release, HISTalk

Department of Justice taking the lead on scrutinizing Google’s Fitbit acquisition. The Federal Trade Commission also sought jurisdiction over the transaction. According to the New York Post, “both agencies are concerned that a Google-owned Fitbit would give the search giant an even bigger window into people’s private data, including sensitive health information, sources said. Under the Hart-Scott-Rodino Act, all large mergers must file proposals with both the DOJ and the FTC, but only one antitrust agency reviews the merger.”

Coal from stockings being thrown about at HHS. According to POLITICO and the New York Times, the disagreements between Seema Verma, the head of the Centers for Medicare and Medicaid Services (CMS), and the Cabinet-level Secretary of Health and Human Services (HHS), Alex Azar, have boiled over, enough to have to be settled by the President’s acting chief of staff, Mick Mulvaney. According to the Times, both President Trump and VP Mike Pence have told them to find a way to work together. Both are administration appointees, but President Trump has not been reluctant to cut a mis-performing or overly contrary appointee loose. The latest salvo from those obviously not on Ms. Verma’s side was the revelation that she requested compensation for jewelry stolen on a business trip, contrary to government policy of course. She was compensated for other items which is standard. (Isn’t that what homeowners’ insurance is for? And what sensible person actually travels with valuable jewelry?) Under Ms. Verma, CMS has been quite progressive in developing new business models in Medicare fee-for-service, moving providers to two-sided risk, and innovating in both Medicare and Medicaid. It will either be settled, or one or both will be gone. Pass the popcorn.

Leeds picks up another health tech company. Mindwave Ventures is opening an office there, as well as appointing Dr Victoria Betton and Dr Janak Gunatilleke to the roles of chief innovation officer and chief operating officer. Mindwave develops technologies around digital products and services in healthcare and health research. Leeds reportedly is home to over 250 health tech companies and holds an annual Leeds Digital Festival in the spring [TTA 11 April].

Ransomware attack hits Hackensack Meridian. Systems were down for about a week. While this large New Jersey health system hasn’t admitted it, sources told the Asbury Park Press that it was ransomware. And if it’s not ransomware, its Emotet and Trickbot. Read ZDNet and be very apprehensive for 2020, indeed, as apparently healthcare is just one big target.

Comings and Goings: There may be some end of year bombshells, but after last week’s big news about John Halamka, it’s been fairly quiet. Paul Walker, whom this Editor knew at New York eHealth Collaborative, has joined CommonWell Health Alliance as executive director. Mr. Walker was most recently Philips Interoperability Solutions’ vice president of strategy and business development. CommonWell’s goal is improving healthcare interoperability and its services are used by more than 15,000 care provider sites nationwide. Blog release, Healthcare Innovation ….Dr. Jacqueline Shreibati, the chief medical officer for AliveCor, is joining Google Health in the health research area. Mum’s the word when it comes to Fitbit (see above). CNBC ….Peter Knight has pleaded guilty to falsifying educational credentials to gain his position as chief information and digital office at Oxford University Hospitals NHS Foundation Trust. He held that position from August 2016 until September 2018. BBC News

The Theranos Story, ch. 61: Elizabeth Holmes as legal deadbeat

Did her lawyers expect otherwise? This weekend’s news of Elizabeth Holmes’ legal team at Cooley LLP withdrawing their representation services due to non-payment should not have caused much surprise. Cooley’s attorney team petitioned the court to withdraw from the case, stating that “Ms. Holmes has not paid Cooley for any of its work as her counsel of record in this action for more than a year.”

Cooley was representing Ms. Holmes in a class-action civil suit in Phoenix brought against her, former Theranos president Sunny Balwani, and Walgreens, charging fraud and medical battery. (When they withdraw, will she seek public representation based on poverty?)

Perhaps Ms. Holmes is the one who’s setting priorities, as the civil suit would be for monetary damages, and no money means there will be none for the plaintiffs to collect. The DOJ charges are a different story. She is on the hook for nine counts of wire fraud and two counts of conspiracy related to her actions at Theranos. Conviction on these could send her to Club Fed for 20 years plus a fine of $250,000 plus restitution for each charge. [TTA 16 June]

Last Wednesday, both Ms. Holmes and lawyers for her and Mr. Balwani were in Federal court in San Jose on the wire fraud and conspiracy charges, demanding that the government release documents from the Food and Drug Administration (FDA) and the Centers for Medicare and Medicaid Services (CMS) that allegedly would clear them. After an hour, Judge Davila set 4 November as the next hearing date. 

Defending oneself does not come cheap, but after your company’s value crashes to $0 from $9bn, one might be looking for change in your Roche-Bobois couch and wondering if your little black Silicon Valley-entrepreneur formal pantsuit/white shirt ensembles will last through the trial. CNBC 2 Oct, CNBC 4 OctFox Business, Business Insider

CMS’ three new proposed telehealth codes, changes on inclusions, in 2020 Medicare Physician Fee Schedule (US)

A little-noticed part of the Center for Medicare & Medicaid Services’ (CMS) annual proposed Physician Fee Schedule rule (Federal Register) for Medicare payments is that CMS on its own, without any provider requests (surprisingly), has proffered three new reimbursement codes, all centered on opioid use treatment:

HCPCS code GYYY1: Office-based treatment for opioid use disorder, including development of the treatment plan, care coordination, individual therapy and group therapy and counseling; at least 70 minutes in the first calendar month.

HCPCS code GYYY2: Office-based treatment for opioid use disorder, including care coordination, individual therapy and group therapy and counseling; at least 60 minutes in a subsequent calendar month.

HCPCS code GYYY3: Office-based treatment for opioid use disorder, including care coordination, individual therapy and group therapy and counseling; each additional 30 minutes beyond the first 120 minutes (List separately in addition to code for primary procedure).

These are classified as Category 1 as they are similar to services already offered under telehealth, so are likely to go into effect on 1 January.

This adds to telehealth services under the SUPPORT Act that removed the geographic limitations for telehealth services furnished to individuals diagnosed with a substance use disorder (SUD). effective 1 July.

Most telehealth services to beneficiaries (Medicare-speak for patients) eligible for reimbursement are limited to qualifying rural areas or one of eight types of qualifying sites and the practitioners are included in one of ten categories of distant site practitioners eligible to furnish and receive Medicare payment for telehealth services. Services also have to be through real-time audio/video and the code (Current Procedural Terminology (CPT)/Healthcare Common Procedure Coding System (HCPCs) are included under Medicare.

Comments on the Rule are accepted through 5pm on 27 September. National Law Review has the details for filing comments here.

SNF emergency telehealth provider Call9 shuts down most operations, after $34M raise (updated)

Is it a symptom of a bubble’s downside? In an interview with CNBC, Dr. Timothy Peck, the CEO of Call9, profiled in TTA only a month ago, confirmed that his company will be shutting down operations. Call9 provided embedded emergency first responders in skilled nursing facilities (SNFs) on call to staff nurses. The first responders not only could provide immediate care to patients with over a dozen diagnostic tools, but also would connect via video to emergency doctors on call. 

Headquartered in Brooklyn, the shuttering of the four-year-old company has laid off over 100 employees as it winds down operations. They claimed 142,000 telemedicine visits and 11,000 patients who were treated via its services. In the past few months, Call9 had inked deals with Lyft for patient transportation and was expanding to Albany NY. They also operated a community paramedicine division utilizing their emergency doctor network.  

This Editor can now reveal that through a reliable industry source, I was informed of Call9’s difficulties earlier this month. Not wanting to ‘run with a rumor’, I contacted Dr. Peck. He confirmed to me information that later appeared in the CNBC article: that the company was refining its model in the face of a change in previous funders and working with some new partners to stay in a model with embedded clinical care specialists in nursing homes. While they would scale back, they still had current contracts. However, the changes in their model would mean that the company would be in a ‘bit of a stealth mode’. After we discussed the business situations that most early-stage health tech companies have faced with funding, we agreed to touch base in a few weeks when things developed.

CNBC, with a different source, had essentially the same information from Dr. Peck on the winding down of the company but in this case also confirmed layoffs, including a ‘pivot’ of the company into a different model around technology in nursing homes. They also confirmed that a part of the company, Call9 Medical, will remain in operations.

Update: Skilled Nursing News had additional detail on Call9’s partnerships which included SNF providers Centers Health Care, CareRite, and the Archdiocese of New York’s long-term care arm, ArchCare. Their first client was Central Island Healthcare, where Dr. Peck lived for three months testing the model. The article goes on with Central Island’s executive director explaining that he is now seeking a telemedicine provider, as they adjusted their services to Call9’s capabilities.

Payer providers included Anthem, Blue Cross Blue Shield, and Healthfirst, plus some Medicare Advantage plans, splitting the savings from avoiding unnecessary ER admissions. Another appeal made by the company for its services was to keep in place higher acuity–sicker–patients in SNFs who would otherwise have to go into the hospital.

As our Readers know, these pages have covered the comings and goings of many health tech and app companies. Some succeed on their own, are acquired/combined with others and go on in different form, or are bought out at their peak, leaving their founders and some employees cheerful indeed. On the other hand, and far more common: the demise of some is understandable, others regrettable, and nearly none of them are cause for celebration in our field–Theranos and Outcome Health being exceptions. This Editor has been a marketing head of two of them (now deceased except for their technology, out there somewhere), and has discussed marketing, funding, and business models with more startups and early-stage companies than she can count.

If anything, investors have less patience than they did back in the Grizzled Pioneer period of the early 2000s, when a $5 million round put together from a few personally (more…)

The Theranos Story, ch. 59: there’s life left in the corporate corpse–patents! And no trial date in sight.

You can get blood out of this. Really! The US Patent and Trademark Office (USPTO) awarded five–count ’em, five!–patents to Theranos in March and April. All of them were filed between 2015 and 2016, when the whispers of fraud were getting louder, as were the legal threats.

The five patents are:

1. Systems, devices, and methods for bodily fluid sample collection, transport, and handling
2. Systems, devices, and methods for bodily fluid sample transport
3. Systems and methods for sample preparation using sonication
4. Systems and methods for sample preparation using sonication (cell disruption)
5. Rapid measurement of formed blood component sedimentation rate from small sample volumes

The CB Insights Research article has the details on what they cover, including patent application illustrations. It’s not stated, but looking back to TTA’s many articles, in this Editor’s judgment, the heir to these patents cannot be Elizabeth Holmes or her many investors now feeling the lint in their pockets, but the company holding the last note, the $65 million (not $100 million) loan from Fortress Investment Group LLC, part of Japan’s SoftBank Group [TTA 28 Dec 17]–collateralized by the portfolio of over 70 patents. Hat tip to HISTalk 19 April

If you hunger for a deep dive into the design of Theranos’ blood analyzers that never really worked, and can appreciate that the miniLab was what “one expert in laboratory medicine called “theater … not science”, this Design World article is for you: Schadenfreude for Theranos — and satisfaction in how engineering doesn’t lie

Meanwhile, back in the US District Court in San Jose, California, we learn that the trial of Ms. Holmes (now engaged to William “Billy” Evans, a 27-year-old heir to the Evans Hotel Group, which has three West Coast resort properties and who is also a techie) and former Theranos president Ramesh ‘Sunny’ Balwani has been delayed indefinitely. Originally reported to be summer entertainment with a start date of 8 July, the judge set the next status conference for the case for 1 July, but refused to set a trial date, which means that the trial may not begin till next year. According to the San Jose Mercury News, the defense is seeking materials from the FDA and CMS, which are, according to defense lawyer, lawyer Kevin Downey, are “in many instances exculpatory.”

Ms. Holmes’ lawyers are also seeking information on the communications between John Carreyrou of the Wall Street Journal, the FDA, and CMS. In a motion filed last week, they accused Mr. Carreyrou under the guise of investigative journalism of “exerting influence on the regulatory process in a way that appears to have warped the agencies’ focus on the company and possibly biased the agencies’ findings against it.” Stat

The bubbly Ms. Holmes and Not-So-Sunny Balwani are facing Federal charges of two counts of conspiracy to commit wire fraud and nine counts of wire fraud. They each face a maximum of 20 years in prison and up to $2.7 million in fines.

The wind may be even stronger at the back of telehealth this year–but not without a bit of chill

Late last year, this Editor noted that ‘the wind may finally be at the back of telehealth distribution and payment’. The expansion of telehealth access for privately issued Medicare Advantage (MA) plans, state-run Medicaid and CHIP (Children’s Health Insurance Plan) plan members, and this year’s Medicare Physician Fee Schedule, along with a limited expansion of telemedicine in the Value-Based Insurance Design (VBID) model for MA announced earlier this year by CMS, is a leading indicator that government is encouraging private insurers to pay doctors for these services, who in term will pay vendors for providing them.

The Veterans Health Administration (VA) has historically been the largest user in the US of telehealth services (home telehealth, clinical video telehealth, store-and-forward). They are also a closed and relatively inflexible system (disclosure–this Editor worked for Viterion, a former RPM supplier to the VA). In 2017, under then Secretary David Shulkin (who left under a cloud, and not an IT one), there were hopes raised through the Anywhere to Anywhere VA Health Care Initiative. So the news released at the start of HIMSS’ annual meeting that veterans will be able to access their health data through Apple’s Health Records app on the iPhone, perhaps as early as this summer, was certainly an encouraging development. According to mHealth Intelligence, the key in enabling this integration and with other apps in the future is the Veterans Health Application Programming Interface (API), unveiled last year.

Anywhere to Anywhere is also making headway in veteran telemedicine usage. Of their 2.3 million telehealth episodes in their FY 2018, over 1 million were video telehealth visits with veterans, up 19 percent from 2017. 105,000 of those video visits were through VA Video Connect to veterans’ personal devices. The remainder were real-time interactive video conferences at a VA clinic. The other half were assessment of data between VA facilities or data sent from home (the underused Home Telehealth).  Health Data Management

Virginia also moved to make remote patient monitoring part of covered telehealth services for commercial health plans and the state Medicaid program. The combined bills HB 1970 and SB 1221 will be sent for signature to Governor Ralph Northam, to whom the adjective ‘beleaguered’ certainly applies. National Law Review

But service providers face compliance hurdles when dealing with governmental entities, and they’re complex. There are Federal fraud, waste, and abuse statutes such as on referrals (Anti-Kickback, Stark Law on self-referral), state Corporate Practice of Medicine Doctrine statutes, and medical licensure requirements for telehealth practices. Telehealth: The Beginner’s Guide to Legal Pitfalls is a short essay on what can face a medical practice in telehealth.

Medicare Advantage model covering telehealth for certain in-person visits starting in 2020

Another small step for remote monitoring and visits. Late last week, the Center for Medicare & Medicaid Services (CMS) announced a limited expansion of telehealth (remote patient visits) coverage as part of the Value-Based Insurance Design (VBID) model. In 2020, plans can apply to use telehealth as part of their coverage. According to the CMS release, Medicare Advantage (MA) is testing a new series of service delivery approaches, including “increasing access to telehealth services by allowing plans to use access to telehealth services instead of in-person visits, as long as an in-person option remains, to meet a range of network requirements, including certain requirements that could not previously be fulfilled through telehealth.” Other MA additions under the VBID mode include expanded rewards and incentives for beneficiaries for health improvement, and reduced cost sharing and additional benefits to enrollees, including those around chronic conditions or socio-economic status, such as aid around social determinants of health. 

The VBID model is administered under CMS’ Center for Medicare and Medicaid Innovation (Innovation Center, also CMMI), which tests innovative payment and service delivery models to lower costs and improve the quality of care. It began in 2017. The CMS VBID page lists 14 participating plans concentrated in a few states; however, it was open to 25 states this year. The 2020 model expands to 50 states under the Bipartisan Budget Act of 2018 plus will accept other MA plan types such as Special Needs Plans and Regional PPOs. Applications will start later this year. CMS press releasemHealth Intelligence 

The wind may finally be at the back of telehealth distribution and payment (US)

Medicare Advantage may lead, but Medicaid and regular Medicare are not far behind. The Centers for Medicare & Medicaid Services (CMS) has announced in two proposed rules changes expansion of telehealth access for both privately issued Medicare Advantage (MA) plans (26 Oct) and state-run Medicaid and CHIP (Children’s Health Insurance Plan) (14 Nov) plan members. This may mean greater acceptance by providers because they will be paid for these services.

For MA, the proposal would, starting in 2020 as part of government funded basic benefits, eliminate geographic restrictions (rural telehealth) and allow members in urban areas to access telehealth services. It would also broaden present location restrictions, allowing MA members to receive telehealth from home versus traveling to a health care facility. The most intriguing wording is here: “Plans would also have greater flexibility to offer clinically-appropriate telehealth benefits that are not otherwise available to Medicare beneficiaries.” which very well could mean remote patient monitoring in conjunction with visits. MA plans have always had more latitude to offer telehealth benefits to members, which are about 1/3 of Medicare-eligibles (over 65). Over 11 percent growth is forecast and it is highly competitive though dominated by United Healthcare and Aetna–over 600 new plans are entering the market next year. Enrollments close on 7 Dec for 2019. CMS.gov release, mHealth Intelligence, Healthcare Finance News.

For Medicaid and CHIP, which states use to extend insurance to low-income individuals and families via private plans, states would be able to, under an approved rule, to more flexibly determine what criteria determine telehealth access. Currently, states use proximity factors–distance from provider and time. The proposed criteria under 10. Network Adequacy (pages 15-16) recommends that time and distance be deleted and instead “adding a more flexible requirement that states set a quantitative minimum access standard (later listed) for specified health care providers and LTSS (long term services and supports) providers”. The reasons why are the limited supply of providers and the functional limitations of the LTSS population. Also notable was language in section 8 discussing access to provider directories via smartphone, as 64 percent of the population with incomes less than $30,000 own a smartphone and use it to access health information.  CMS proposed rule, POLITICO Morning eHealth

This adds to the momentum of the Medicare Physician Fee Schedule published on 1 Nov that added even more:

  • Virtual brief patient checkins and evaluation of patient-recorded photos and video to payments
  • CMS is also finalizing separate payments for three new codes covering chronic care remote physiologic monitoring that unbundle 99091 (CPT codes 99453, 99454, and 99457) and interprofessional internet consultation (CPT codes 99451, 99452, 99446, 99447, 99448, and 99449).
  • Two new codes covering telehealth for prolonged preventive services
  • Finalizing the addition of renal dialysis facilities and the homes of ESRD beneficiaries receiving home dialysis as originating sites
  • After 1 July, the home will be permitted as a permissible originating site for telehealth services furnished for purposes of treatment of a substance use disorder or a co-occurring mental health disorder. CMS.gov fact sheet 

The importance of this is that more digital health covered by Medicare and government payments in public/private programs such as Medicaid and MA lead private insurers to pay doctors for these services, who will then be willing to pay vendors for providing them. For the telehealth and telemedicine companies that have weathered the storms and lean times of the past decade, there may be light at the end of the tunnel that is not an oncoming train.

Soapbox: Big Genomics and DNA testing–why we need a Genomic Data Bill of Rights

[grow_thumb image=”http://telecareaware.com/wp-content/uploads/2015/03/DNA-do-not-access.jpg” thumb_width=”150″ /]This week, consumer genomics testing company 23andMe announced that outside app developers would no longer have access to raw genomic data, as they have had since 2012. They will continue to have access to data through reports generated by the company. 23andMe cited privacy concerns–wisely, in this Editor’s opinion, to safeguard this burgeoning area of digital health. Seeking Alpha

TimiHealth is an affected firm that seeks to move customer data, with consent, to an allegedly more secure blockchain platform, TimiDNA, citing 23andMe’s monetization of their data and CMS’ Blue Button initiative, a recent meeting in which 23andMe participated as a developer. Blasting away, TimiHealth stated that “It flies in the face of the mission of CMS, and the MyHealthEData initiative and the goal of putting patients first.” Release

However, the consumer marketing of DNA testers such as 23andMe, Ancestry.com, and smaller competitor Helix, has already led to multiple privacy questions on how the data of millions are being used and sold. 

This Editor would feel safe in assuming that most customers do not know nor particularly care that GlaxoSmithKline (GSK) as of July owns 50 percent of 23andMe via a $300 million investment. Both have announced a four-year partnership to use the 23andMe genetic database for drug research. For instance, the LRRK2 gene has been linked to some forms of Parkinson’s disease. GSK needs about 100 for a trial sample of one, but 23andMe has already provided 250 Parkinson’s patients who have agreed to be re-contacted for GlaxoSmithKline’s clinical trials. Scientific American

While most data is de-identified, you can agree to be contacted for further use in clinical trials, which is fine–but most users do not know how to opt out. It’s a surprisingly tricky process, as outlined in this useful Business Insider article, and you may not be able to withdraw all your data or have your saliva sample destroyed.

Data can be hacked and reprocessed. Three years ago, TTA explored reports on exactly how de-identified genomic data could be made identifiable through the ‘nefarious use’ of genomic data sets available through research networks [TTA 31 Oct 15].

Despite the trite, simplistic, and condescending commercials by Ancestry.com on how someone found they had ethnic or national roots they never dreamed of, or were related to royalty, both giving meaning to their presumably mundane life, genetic info has value beyond the feel-good. It’s long past time for a plain language Genomic Data Bill of Rights.

  • Individuals should know how their personal genomic data is being used and how it is being protected
  • They should be able to opt out of use, identified and de-identified, easily–and not have to jump through hoops
  • Reporting/interpretation should also have integrity, consideration, and respect that it may upset a person or that it may not be interpreted correctly, which is a fundamental problem 
  • A more radical view is that the same individuals should be compensated when their data is used

This Editor will settle for the first two bullets, for now. 

The 50,000 foot pick as CEO of the JP Morgan Chase-Berkshire Hathaway-Amazon health joint venture

US healthcare is abuzz at the choice that JP Morgan Chase-Berkshire Hathaway-Amazon made to head their healthcare JV: Dr. Atul Gawande, currently practicing general and endocrine surgery at Brigham and Women’s Hospital and teaching as a professor at the Harvard T.H. Chan School of Public Health and Harvard Medical School. Dr. Gawande is presently an executive director of Ariadne Labs, a healthcare innovation center, a writer of four best sellers on healthcare and noted as an outspoken theorist on how the ‘broken’ healthcare system in the US can be fixed. (This Editor’s definition of ‘broken’ is slightly different, encompassing countries like Venezuela, Cuba, Zimbabwe, post-WWII Germany, and the Ceausescu-era Romania where the basics are simply not there for the average person.)

Dr. Gawande will transition to chairman of Ariadne and retain his surgical and teaching positions.

Praise for Dr. Gawande comes from many quarters. Andy Slavitt, the former head of CMS during the previous administration, said “There are few better people in health care” and praised his ‘moral leadership’ when approached by Messrs. Dimon, Bezos, and Buffett. Jeff Bezos: “We said at the outset that the degree of difficulty is high and success is going to require an expert’s knowledge, a beginner’s mind, and a long-term orientation. Atul embodies all three, and we’re starting strong as we move forward in this challenging and worthwhile endeavor.”

What is missing from this sterling public health advocate and practitioner’s resumé is obvious: real business management experience. Among his three soon-to-be-bosses, there is plenty of pontificating from 50,000 feet–for but one example, see this Editor’s POV on Jamie Dimon’s annual shareholder letter [TTA 10 Apr]. Here is what they stated as the purpose of the JV back in January: “partnering on ways to address healthcare for their U.S. employees, with the aim of improving employee satisfaction and reducing costs” and setting up an independent company “free from profit-making incentives and constraints. The initial focus of the new company will be on technology solutions that will provide U.S. employees and their families with simplified, high-quality and transparent healthcare at a reasonable cost.” And more in that vein. (Whew!) It was eye-rolling, even shortly after the announcement back in February.

But actually getting this done is not a TEDTalk. First, there is the hard in-the-trenches work to bring both the management and the 1 million employees of three very different companies onto the same page. Second, it is running the gauntlet of regulations on the national level (that CMS and HHS) plus in 50 states, if this combine chooses to operate as an insurer or PBM. Third, if they don’t, there is getting the cooperation of insurers (payers) who aren’t in business to lose money. There is not only regulation, but also what they are willing and can afford to do. This Editor noted back in January that large companies, including these three, “generally self-insure for healthcare. They use insurers as ASO–administrative services only–in order to lower costs. Which leads to…why didn’t these companies work directly with their insurers to redo health benefits? Why the cudgel and not the scalpel?”

This Editor would expect that a group of skilled senior, operationally focused executives will be hired to work under Dr. Gawande in Boston, where this unnamed-yet venture will be headquartered. There may be some more high-profile senior executives with unconventional backgrounds. From this (lower than 50,000 feet) perspective, Dr. Gawande will be the attention-getting CEO, spokesman, and pace-setter; others will be doing the heavy lifting behind the scrim. 

Beyond the usual glowing coverage on CNBC and TechCrunch, those in the business of healthcare are already expressing more sanguine opinions on the enterprise and how Dr. Gawande will be leading it with multiple medical, teaching, and writing commitments. Modern Healthcare has a fairly balanced article.

Scary Monsters, Take 3: one week later, JPMorgan Chase takes heat, Amazon speculation, industry skepticism

It’s the Week After the Amazon/Berkshire Hathaway/JPMorgan Chase announcement of their partnership in a non-profit joint venture to lower healthcare costs for their 1.1 million employees, and there’s a bit of a hangover. Other than a few articles, there’s been relative quiet on this front. This could be attributed to the financial markets’ roller coaster over the past few days, at least in part due to this as healthcare stocks were hardest hit. In the US, healthcare is estimated to be 18 percent of the economy based on Centers for Medicare and Medicaid Services (CMS) actuarial statistics for 2015…and growing. 

Jamie Dimon, CEO of JPMC, had some ‘splainin’ to do with some of the bank’s healthcare clients, according to a report in the Wall Street Journal (paywalled) summarized on MarketWatch. He assured them that the JV would be to serve only the employees of the three companies. JPMC bankers handling the healthcare sector also needed some reassuring as they are “paid handsomely to help clients with mergers and other deals and worry the move could cost them business.”

Speculation on Amazon’s doings in healthcare remains feverish. A more sober look is provided by the Harvard Business Review which extrapolates how healthcare fits into Amazon’s established strength in delivery systems. Amazon could deliver routine healthcare via retail locations (Whole Foods, Amazon Go), same day prescription delivery, passive data capture developed for Amazon Go sold as a service to healthcare providers (on the model of Web Services), and data analytics.

Headlines may have trumpeted that the three-way partnership would ‘disrupt healthcare’, but our Readers in the business have heard this song before. While agreeing with their intent, this Editor differed almost immediately with the initial media cheering [TTA 31 Jan]. The Twitterverse Healthcare FlashMob in short order took it down and apart. STAT racks up some select tweets: in the ACO model, savings come when providers avoid low-value care; the contradiction of profitable companies avoiding profit; that the removal of healthy employees from existing plans will increase inequity and the actuarial burden upon the less insurable; the huge regulatory hurdle; and the dim view of investment advisory firm Piper Jaffray that it will not be a ‘meaningful disruptor’. 

In this Editor’s view, there will be considerable internal politicking, more unease from JPMC customers, and a long time before we find out what these three will be doing.