News updates: Theranos’ Holmes goes ‘mental’ in last ditch defense; troubled Cerebral telemental health fires another 400

October 26, 2022 | by

Blood out of a rock? The Holmes’ defense goes ‘mental’ with Dr. Adam Rosendorff. Reduced to a limited hearing before Judge Edward Davila and the US District Court in San Jose, where Rosendorff not only reaffirmed his testimony but also explained the circumstances around his visit to the home, the Holmes defense filed a motion on Monday, citing an obscure interview published in September by the South African Jewish Report to cast doubt about the veracity and credibility of his testimony. Rosendorff, who was born in South Africa, recounted to the interviewer that the stress from blowing the whistle on Theranos led to a “breakdown, medication, hospitalization, and health problems.”

Rosendorff also stated in the interview that by the time the trials (Holmes and Balwani) were scheduled in early 2020, he was off medication. The trials finally took place in 2021 (Holmes) and this year. When questioned last week by defense lawyer Lance Wade about his mental state, his response was that “I’m finding this line of questioning to be invasive.” and that his “mental state was solid” when he drove to Holmes’ home wanting to speak with her. The prosecution objected to the questioning and Judge Davila upheld it.

The prosecution’s response to the defense filing is that the court record “contains no indication whatsoever that Dr. Rosendorff suffered from a mental health issue that affected his ability to serve as a reliable witness,” and that “newly raised and uncorroborated insinuations about Dr. Rosendorff’s mental health do not justify discounting his testimony or granting a new trial.”

The Mercury News’ money quote from New York defense lawyer Jennifer Kennedy Park: “I think the judge already made the decision that this is not relevant.” Another lawyer quoted, former Santa Clara County prosecutor Steven Clark, said that the stress can be difficult but that it apparently didn’t affect Rosendorff’s capacity to testify–and that he was consistent across two trials.

Unless Judge Davila decides to delay–not likely given the above and the pending sentencing for both Holmes and Balwani–or there are additional magic ‘rabbits out of hats’, Holmes’ sentencing remains scheduled for 18 November, Balwani’s later this year.

And speaking of mental health, beleaguered telemental health provider Cerebral let go of 400 more staff, or another 20% of their remaining workforce. This follows a layoff of ‘hundreds’ of contractors, including nurse practitioners who did counseling and support staff, at end of May. Cerebral is ‘restructuring’ under a new CEO, David Mou, who replaced CEO and co-founder Kyle Robertson  forced out by the Cerebral board after the first round of investigations by the Department of Justice (DOJ) on over-prescribing of controlled substances and the subsequent defection of CVS Health and Walmart, as well as Truepill on mail fulfillment. Their statement cites “operational efficiencies while prioritizing clinical quality and safety across the organization.” Cerebral had at its peak in the spring 4,500 employees.

In addition to the DOJ investigation, the FTC is investigating Cerebral for deceptive advertising [TTA 1 June] and a former VP of product and engineering, Matthew Truebe, is suing for wrongful dismissal, further exposing the inner workings of the company [TTA 16 June]. Employees have gone public with tales of pushing prescriptions to 95% of patients, disregarding state regulations, and generally Running Wild over any semblance of clinical probity [TTA 29 June]. Certainly Softbank cannot be delighted at the rolling crackup of their once-valued $4.8 billion baby for which they’ve led funding of over $426 million. TechCrunch, Healthcare Dive.

Meta Pixel ad tracker collects another 3 million data breaches at Advocate Aurora Health; Zuckerberg getting Senate scrutiny

October 21, 2022 | by

The Pixel ad tracker continues to be a Big Problem for Meta and Facebook. Advocate Aurora Health, a large health system in Illinois and Wisconsin, this week informed 3 million patients of a potential data breach connected to the use of Meta Pixel. The Meta Pixel snippets of JavaScript code were used within their Epic MyChart and LiveWell websites and applications, as well as on some of their schedulers.

As we have previously noted (below), ad trackers like the Meta Pixel are used to target website visitors and also to track ads placed on Facebook and Instagram. Developers routinely permit these snippets of code as trackers for better performance and website tracking, but the problem here is that sensitive patient information (PHI) is being sent back to Facebook where it violates patient privacy and can be misused.

Advocate Aurora cited that Meta Pixel may have collected “IP address; dates, times, and/or locations of scheduled appointments; your proximity to an Advocate Aurora Health location; information about your provider; type of appointment or procedure; communications between you and others through MyChart, which may have included your first and last name and your medical record number; information about whether you had insurance; and, if you had a proxy MyChart account, your first name and the first name of your proxy.” It did not collect social security number, financial accounts, credit cards, or debit card information. At this point, there is no reported misuse of information. Bleeping Computer, HealthcareITNews

That this is at all problematic is being vigorously denied by Facebook. But in an unusual move, Senator John Warner (D-VA) sent a letter yesterday to Meta CEO Mark Zuckerberg, containing seven fairly rigorous questions based on The Markup’s articles to be answered by 3 November. This follows on Sen. Jon Ossoff’s request via the Senate Homeland Security Committee (below)  (Editor’s opinion: to be written by Meta’s lawyers, and don’t hold your breath for any rending of garments or mea culpas.) HealthcareITNews, The Markup

Our previous articles on The Markup‘s research and Meta Pixel:

Breaking: Hospitals sending sensitive patient information to Facebook through website ‘Meta Pixel’ ad tracker–study

Facebook Meta Pixel update: Nemours Children’s Health using 25 ad trackers on appointment scheduling site

Let the lawsuits begin: Meta sued by health system patient for Meta Pixel info gathering

Novant Health notification 

Meta facing some Senate scrutiny on Meta Pixel’s health data collection–and how it’s used

Breaking: CVS’ Signify Health buy under DOJ scrutiny in ‘second request’

October 21, 2022 | by

Not unexpectedly, the US Department of Justice (DOJ) is taking a hard look at the Signify Health acquisition by CVS Health. The two companies were notified Wednesday on DOJ’s Second Request for information. This was disclosed on an SEC Form 8-K. The DOJ now has 30 additional days to investigate antitrust aspects of the merger, once that additional information is received. 

The timetable goes like this:

  • 19 Sept: CVS filed its premerger notification and report with the DOJ and the Federal Trade Commission (FTC) under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (HSR). This initiates a 30-day waiting period.
  • 19 Oct: At deadline, the request for additional information initiated by the DOJ was received by both CVS and Signify (Second Request)
  • The Second Request extends the waiting period under the HSR Act by 30 days after both CVS and Signify have substantially complied with the Second Request. The DOJ can terminate the waiting period earlier, or move it to an agreed-upon later date. 

CVS continues to affirm closing the deal by first half 2023 as planned, which is a fairly wide window.

The current government’s DOJ and FTC have made no secret of their policy-driven yen for using antitrust in the name of lowering healthcare costs (even favored pharma). The crashing failure of DOJ’s antitrust motions against UnitedHealthGroup and Change Healthcare [TTA 20 Sept] must have smarted. What this usually initiates is the search for a quick and easy win to put said embarrassment behind them. CVS Health is certainly a high-profile target, though Signify even at $8 billion, like Change, is not except in the industry. 

Signify’s competitive overlap with CVS/Aetna isn’t as large or obvious as UHG’s Optum with Change, but there is some: home health management and (in this Editor’s view), ACO management services with Signify’s Caravan, which participates in multiple Federal shared savings models where Aetna also is. One wonders if some divestment will be demanded by DOJ. Even before the auction, Signify started the complicated and long exit from the failing Bundled Payments for Care Improvement (BPCI) programs inherited from the Remedy Partners buy.

Could the DOJ action have played a role in CVS’ sudden cold feet in acquiring Medicare/Medicaid primary care provider Cano Health? [TTA 20 Oct] The timing is certainly close. 

DOJ is not working alone. The FTC also has a yen for Amazon in their 2 September second request for information on their acquisition of OneMedical, which also added 30 days to the Hart-Scott-Rodino (HSR) clock after compliance. Amazon is already going through this with their iRobot acquisition [TTA 15 Sept]. Reuters, FierceHealthcare, Home Health Care News

News roundup: CVS abandons (?) Cano Health buy; Signify adds home RPM; BioIntelliSense RPM acquires AlertWatch; GE Healthcare, AMC Health partner; Viome raises $67M, other fundings

October 21, 2022 | by | 1 Comment

CVS Health apparently backs away from a strategic primary care buy. Earlier this week, both Barron’s and DealReporter (via FactSet) reported that CVS Health is no longer pursuing an acquisition of Cano Health, a primary care provider group in Florida, Texas, Nevada, California, Illinois, New Mexico, and Puerto Rico that concentrates on senior health, Medicare Advantage patients, and value-based care. Cano has 4,000 employees and 280,000 members. Reasons why were not disclosed by either CVS or Cano. Cano shares listed on the NYSE fell on the news from Monday’s open of $8.22 to $4.50 today (20 Oct). An alternative buyer may be Humana, which has a right of first refusal on a sale dating back to 2019, but Humana has been quiet on the acquisition front of late.

Walking away seems contrary to CVS’ stated strategy of pursuing deals in primary care, provider enablement, and home health, but CVS can afford to be choosy. There’s speculation that CVS has a different provider/VBC enablement target in mind.  Jailendra Singh of Truist Securities identified ACO management services organization Privia Health as a potential buy that would fit well with CVS’ pending buy of Signify Health, which includes competitor Caravan Health (more on this here). But who knows if this ‘walk away’ is final? Healthcare Finance, FierceHealthcare

CVS’ pending deal, Signify Health, announced the addition of spirometry testing to evaluate patients for COPD. This will be added to their existing suite of in-home diagnostic testing and tracking, In-Home Health Evaluation, targeted to Medicaid and Medicare Advantage members. Mobihealthnews

If there’s a Cinderella this inflationary, recessionary year, it’s remote patient monitoring (RPM). BioIntelliSense has been in RPM since 2020 with on-body/stick-on sensors such as the BioButton and the BioSense 30-day monitor. Their latest addition through acquisition is the AlertWatch clinical intelligence and triage system. AlertWatch will join BioIntelliSense’s product group within Medtronic’s HealthCast portfolio in US hospital patient monitoring as part of their existing partnership. In the past ten years, AlertWatch achieved four FDA 510(k) clearances for its specialized product offerings for the operating room, intensive care unit, and labor and delivery unit.  BioIntelliSense release

Veteran RPM company AMC Health will be partnering with GE Healthcare (GEHC) for post-discharge in-home care monitoring. This will extend GEHC’s hospital-based monitoring into post-acute patient needs and anticipate future care needs, potentially reducing unnecessary readmissions. It’s also planned that eventually both hospital and home data will be integrated into GE’s Edison Health database. GEHC also announced additional details about its spinoff, due to happen in early 2023. [Also TTA 12 Nov 21 and 20 July] Mobihealthnews

Healthcare/health tech raises haven’t entirely disappeared. Viome, which uses AI to test the oral and gut microbiome to prevent, diagnose, and treat chronic diseases and cancer, just raised a $67 million Series C led by Bold Capital Group with participation from Khosla Ventures, West River Group, Glico, Ocgrow Ventures, and Physician Partners, for a total raise since 2017 of over $169 million (Crunchbase). Viome recently launched the CancerDetect test for oral and throat cancers under the FDA Breakthrough Device Designation. Last year, they expanded their partnership with GlaxoSmithKline to research and potentially develop interventions for some cancers and autoimmune diseases. Viome release  

Mobihealthnews rounds up several other financings from genomic tester Variantyx’s $20 million in debt financing to mental health app Mindful Care’s modest $7 million Series B and dataset research collaboration platform Rhino Health‘s $6.7 million seed round extension for an $11 million total.

Rosendorff stands pat on Theranos’ Elizabeth Holmes: “She needs to pay her debt to society”

October 20, 2022 | by

Monday’s limited hearing in US District Court on Adam Rosendorff’s Mysterious Visit to Casa Holmes is likely to be a Defense Dud. Rosendorff walked Judge Edward Davila through the circumstances of his visit, what he said–which differed from Holmes’ partner Billy Evans’ recollection–and reaffirmed his testimony in the Holmes trial plus his sworn declaration given prior to the hearing.

  • He recounted his feelings of distress that Holmes’ and Evans’ son would “spend his formative years” without his mother in prison. The surprise contained here is his testimony that “It’s my understanding that Ms. Holmes may be pregnant again.” Follow-up by reporters outside of court was not answered by either Dr. Rosendorff or Evans.
  • Rosendorff reaffirmed that he testified “truthfully and honestly” on Theranos. “At all times the government has encouraged me to tell the truth and nothing but the truth.” 
  • Regarding telling Evans that the prosecution made the situation at Theranos sound worse than it was, Rosendorff did not recall that. He reconfirmed that he didn’t believe the prosecution did that. Rather, the prosecution “was trying to paint an accurate picture of Elizabeth Holmes.” 
  • As to another Evans statement that Rosendorff regretted that the prosecutors made people at Theranos look bad, he countered that “to the extent that other people looked bad, it was because of their association with Elizabeth.”
  • Overall, “I don’t want to help Ms. Holmes. At this point she needs to pay her debt to society.”

For anyone who has been through a legal process, Dr. Rosendorff’s all-too-human reactions after the extraordinary strain of two trials as well as the destruction of his career, his wanting to square things with, and confront, the cause of years of tsuris is understandable. That, of course, was ill-advised in the extreme. One only hopes that he has family and friends to comfort, counsel, and help him in moving toward a satisfying future, perhaps well away from California. He can also reflect that the four counts for Holmes and 12 for Balwani were on fraud, proved by the testimony of others who certainly aren’t running to Casa Holmes banging on her door.

Barring any other defense rabbits out of hats, Holmes is scheduled to be sentenced by Judge Davila on her four counts on 18 November to begin paying her debt to society. Mercury News

Theranos’ Holmes sentencing now 18 November, defense wants to expand hearing scope; Balwani can’t join in

October 13, 2022 | by

Elizabeth Holmes will be receiving a limited hearing concerning The Mysterious Visit of Dr. Adam Rosendorff and her defense is attempting to expand the hearing. But Sunny Balwani won’t be joining in. The highlights of their recent District Court activities under Judge Edward Davila:

  • Holmes’ sentencing on her four counts has been reset to 18 November at 10am PT. This is despite the limited hearing on 17 October to determine whether Adam Rosendorff was really regretful about his testimony (as the Holmes defense maintains) and what he said and did. 
  • In a separate order, Judge Davila rejected Balwani’s defense move to join in the hearing. Rosendorff’s statements to Evans “related exclusively to his testimony during Ms. Holmes’ trial, not Mr. Balwani’s trial,” and provide “no basis for Mr. Balwani to examine” Rosendorff at the hearing.
  • In a filing, Rosendorff’s legal team asked Judge Davila to quash a subpoena sent by Holmes’ defense to obtain additional information from Rosendorff to use in next week’s hearing. “(Holmes) has sought to transform that limited inquiry into a free-for-all in which Dr. Rosendorff would be required to search through more than a year’s worth of sensitive emails, text messages, and other communications with family, friends, and others so that (Holmes) can try, yet again, to make him look like a liar.”
  • In that filing, the legal team also provided explanations of Dr. Rosendorff’s actions on that day. Driving around the area, he saw that the Theranos building had been torn down and a residential development complex built in its place, and the Palo Alto Walgreens where the first pilot took place had been replaced by a rug store. He wanted to “forgive her for the pain and suffering her actions have caused in his life” and to express his condolences on the child growing up without a mother. Unfortunately, he didn’t stop there on Memory Lane but took a drive up to the well-known location of her rental house, where recollections do differ and increased his tsuris as a result. 

Mercury News, Palo Alto Online

News roundup: CVS sells bswift; Babylon puts Meritage IPA up for sale, financially realigning to prevent delisting; Redesign Health sheds 20%, Noom 10%

October 13, 2022 | by

Companies shedding ancillary businesses, and more than a few of their people that make them go. 

CVS Health is selling bswift to Francisco Partners. Bswift, a benefits technology and HR services company, was acquired by Aetna in 2014 for $400 million. It became part of CVS Health in 2018 after CVS acquired Aetna. Based on the website, it was operated independently. Francisco Partners, an investment group specializing in tech, recently acquired IBM Watson (now Merative) [TTA 7 July] and added it to 400-odd portfolio companies. Acquisition cost and management transitions were not disclosed, but expected to close by Q4 this year. The company will continue to partner with CVS Health and Aetna. Francisco Partners/bswift release, Mobihealthnews, FierceHealthcare, HealthcareFinanceNews

Babylon Health exiting the provider business, transitioning to US financial reporting requirements, and reversing stock to boost price. Babylon has put on the block Meritage Medical Network, an independent physician association (IPA) based in Northern and Central California with 1,800 providers in six counties serving 90,000 patients. The sale was announced 12 October and is expected to complete in early 2023. Babylon’s rationale is “to focus on its core business model through further investment in its digital-first contracts”. It was a short-lived foray, as Meritage was bought only last year along with First Choice Medical Group [TTA 7 Oct 21], which is not mentioned, and completed prior to their SPAC.

Babylon is also financially realigning.

  • On 12 October they also announced conversion to US financial reporting and GAAP accounting from reporting as a foreign private issuer. This will be effective in January 2023.
  • In September, shareholders approved a reverse share split to take place in Q4 to consolidate shares within the approved range of 15:1 to 25:1. All shares will be converted to Class A ordinary shares from a previous A/B structure.

These address a major problem that threatened Babylon’s listing on the New York Stock Exchange (NYSE). In September, Babylon received notice that it violated NYSE rules in not maintaining an average closing share price of at least $1 over 30 consecutive days. Today’s close (12 October) was $0.42. A reverse split will boost the stock price and prevent Babylon from being delisted. Babylon release, Mobihealthnews

After a brief break, healthcare layoffs continue even at richly valued companies with recent raises.

  • Redesign Health is releasing 20% of its workforce, or 67 people from its NYC-based workforce. This is one month after a $65 million Series C raise in late September from General Catalyst, CVS Health Ventures, and other investors, and a valuation in the $1.7 billion range. According to a company spokesperson, these had nothing to do with the Series C or financially driven, but according to the CEO, part of a “ongoing evolution, and given the need to prioritize in a challenging market”. Departments affected in the ‘restructuring’ are engineering, product, marketing, and recruiting. Redesign is unusual in that it creates startups from its own research, assembles management teams, brands, and funds them. To date, it has created about 40, including a few that have had layoffs of their own (Calibrate). Redesign had planned to create more than 25 new companies by the end of 2022, which apparently will not happen. Fast Company, Mobihealthnews
  • The heavily advertised weight loss app Noom reportedly will be laying off 10% of their staff, or 500 people primarily in coaching. Noom currently has a valuation around $3.7 billion and a cumulative funding of $650 million. Apparently there is also a change in direction from the original (and successful) concept of nutrition, behavioral, and exercise coaching via live chat to scheduled video consults as part of a mind and body platform with a higher degree of personalization, including mental health. The company CFO is also departing for TripAdvisor, according to the Wall Street Journal. TechCrunch

Perspectives: How joined-up communications can enable connected patient care across healthcare Trusts

October 12, 2022 | by

TTA has an open invitation to industry leaders to contribute to our Perspectives non-promotional opinion area. Today, we have a contribution from Dave O’Shaughnessy, Avaya’s Healthcare Practice Leader for EMEA and APAC. The subject is NHS England’s transition to an integrated care system and where a cloud-based communications system helps in patient engagement and care team coordination.

Interested in being a Perspectives contributor? Contact Editor Donna. 

Photo courtesy of Avaya

The new NHS’ integrated care system (ICS) aims to support patients across England with health and care that is ‘joined-up’ in its delivery from local councils, the NHS, and other partners. The aim is to remove the existing silos that separate hospitals, GPs, physical health, mental health, and council services from each other.

As each ICS region starts to prepare their 5-year plan, there is an opportunity for modern communications and collaboration technology solutions to play an important role in helping to address healthcare Trusts’ challenges as they work to deliver joined-up services across their ICS.

Connected Challenge

As part of a successful ICS, a Trust will need to deepen its relationship with a number of other stakeholders, including local councils, the voluntary community and social enterprise sector. This can be greatly facilitated by leveraging communications and collaboration services to improve experiences at both a local level as well as scaling the solution across the region. In this way, what were previously isolated pain points can be solved across the whole ICS.

Four Areas for Improvement

There are four key practice areas where cloud-based communications and collaboration solutions can help maximise the positive transformation of the patient and key worker experience – patient access to care, patient experience, team member experience, and collaboration across an ICS. Let’s add some details to these four areas:

  1. Improving patient access to care includes managing healthcare appointments, prescriptions, payments, and other everyday administrative tasks in a way that works effortlessly for all parties, constructive access to healthcare specialists where control of access is maintained by support staff, enabling more complex remote treatments and monitoring whilst maintaining a high quality of care; and effective, non-repetitive, digital data capture and organisation to reduce the administrative burden on both patients and staff.
  2. Creating an engaging patient experience includes integrating digital therapeutics to enhance and modernise traditional care, creating scalable, even automated on-demand patient health services to help avoid overwhelming hospital staff; ensuring these digital services are intuitive, easy to learn, and practically accessible to all patients and staff; creating more personalised and therefore meaningful care experiences cost-effectively and rooted in scientific and behavioural understanding.
  3. Enabling beneficial care-team coordination, to help staff focus on delivering healthcare services, will include being able to contact and communicate with the required staff resources (e.g. on-call specialists, hospital orderlies) with the minimum of effort or time-wasting steps; making best use of scarce specialist resources to tackle the elective backlog without adding to burnout, and leveraging the best features from communications and collaboration services to help remove frustrating siloes and operational complexities.
  4. Collaboration with healthcare providers across the ICS includes creating consistent, beneficial experiences across regions despite variations in age and quality of infrastructures; removing duplication or confusing patient treatments across Trusts and other care providers; maintaining compliant data governance and security to create ‘joined-up’ care without adding to staff burnout, reduction in hospital alarm notifications and messaging fatigue, and maintaining clear roles and responsibilities for transformation projects to prevent delays.

When collaboration and communications services are connected across the entire patient journey from before a visit, during a visit, and then after a visit, they become integral to the improvement of the total experience for patients, clinical staff, and back-office staff. It can be a good idea to start off by using a benchmarking tool to measure against industry standards, and so get a good idea of a healthcare provider’s innovation readiness.

Q3 digital health funding craters nearly 50% to $2.2B: Rock Health

October 5, 2022 | by | 1 Comment

Returning to 2020 and prior trends? The recession and expensive money have hit quite comprehensively in digital health, with Rock Health’s quarterly/YTD tracking that Q3’s digital health funding of $2.2 billion declined to a little over half of Q2’s $4.1 billion. It is the lowest quarter in funding since Q4 2019’s $2.1 billion. Q3’s performance is also reflected in the number of deals completed, tracking at a scant 125 deals.

Are we returning to a prior norm? In looking at YTD 2022 funding ($12.6 billion, 458 deals), it is trending very close to the full year of 2020 at $14.7 billion and 481 deals which in turn was a decent increase from 2019. Allowing that it was kickstarted by carryover from 2021 (Q1 of $6.1 billion), it puts 2021 in sharp relief as a Covid-driven and (in this Editor’s estimation) ‘silly money’ outlier since Rock Health’s tracking started in 2012.

Reviewing Rock Health’s numbers:

  • They project that 2022 will not even attain half of 2021’s funding levels
  • Average deal size YTD is $27 million, $3 million less than 2020 and $12 million less than 2021
  • Raises of Series C and above nearly vanished: only 6, accounting for less than 5% of total funding. Q2, by contrast, had 19 Series C+ raises. And there were only two digital health mega raises of $100M or more compared to 2021’s average of 22 per quarter. Rock Health speculates on the reasons why, including that some were diverted into other funding types such as round extensions and venture debt.
  • Mental health continues to lead the composition of funding by clinical indications, with oncology and cardiovascular moving into the #2 and #3 spots YTD versus 2021, with diabetes moving back to #4. In value propositions, non-clinical workflow jumped to #1 with on-demand healthcare holding on to the #2 spot. R&D fell back to #3 from last year’s #1 spot.

Certainly for those seeking funding, this confirms that the open wallet days for anything labeled digital health are over and not returning.   

Catchup News Roundup: UHG-Change buy final; Theranos’ Holmes sentencing delayed, ‘limited hearing’ agreed to

October 4, 2022 | by

Note: your Editor is on the mend after returning from vacation with a nasty bug that’s laid her low for the better part of a week.

UnitedHealth Group’s Optum unit completed its acquisition of Change Healthcare, after the 10-day agreed waiting period post-decision. As planned, Change will be folded into the OptumInsight unit. The all-cash deal was either $7.8 billion or $13 billion, depending on what source you go with [TTA 20 Sept].

The Department of Justice has a generous quantity of Grade A, Extra Large Egg on its metaphorical face. The District Court decision found that the DOJ did not conclusively prove its allegations of antitrust and loss of competition in services. Statements from UHG’s competitors such as Cigna, Aetna, and Elevance (Anthem) that the acquisition would not lead them to ‘stifle innovation’ also weakened the DOJ’s case. The major conflict, ClaimsXtend, was already in progress of divestiture to TPG.

Challenging acquisitions post-closing is difficult but has happened. Readers may recall the 2019 nine-month long District Court Tunney Act review drama over the final approval of the CVS buy of Aetna, dragging on long after the buy was final and reorganization was underway. If the Tunney Act applies, and this goes to a certain Judge Richard Leon, watch out!  Optum’s release did not disclose reorganization plans or management changes. Healthcare Dive, FierceHealthcare 

Elizabeth Holmes’ sentencing delayed to allow a ‘limited hearing’ on The Mysterious Visit of Adam Rosendorff.  The ‘crafty strategy’ [TTA 16 Sept] scored a win today (3 October). Judge Edward Davila accepted the defense’s request for a limited hearing on whether there was any prosecutorial misconduct in Dr. Rosendorff’s testimony and delayed Holmes’ sentencing originally scheduled for 17 October.

In August, according to Holmes’ partner Billy Evans, in a scene lifted out of TV’s Perry Mason, Dr. Rosendorff arrived at Holmes’ home doorstep disheveled and apologetic, allegedly telling Evans that the prosecution “made things sound worse than they were.” Yet Dr. Rosendorff swore a declaration to the prosecution after the Mysterious Visit that he testified “completely, accurately and truthfully” and stood by his testimony, while expressing “compassion” for her and her family. Rosendorff’s testimony was more about the Theranos labs and how they defrauded patients based on specious PR and inflated claims, not the investor fraud of which she was convicted. 

The limited hearing has been scheduled for 17 October (the original sentencing date). Judge Davila has already stated that the hearing will not last the full day. He also offered to both the prosecution and defense options for new sentencing dates: mid-November, early December, or mid-January. How this will affect Sunny Balwani’s upcoming sentencing on 12 counts is not known. Mercury News 

Meta facing some Senate scrutiny on Meta Pixel’s health data collection–and how it’s used

September 20, 2022 | by

A member of the Senate Homeland Security and Governmental Affairs Committee, Sen. Jon Ossoff (D-GA) has requested that Facebook’s parent, Meta, account for healthcare information that it has collected as a result of the Meta Pixel being used on leading hospitals’ websites as an ad tracker. During a hearing, Meta chief product officer Chris Cox was questioned about Meta’s having and using the data and responded, “Not to my knowledge.” According to this latest report in The Markup, Cox will follow up with a written response to the committee.

The June investigation by The Markup and STAT [TTA 17 June] investigated how these snippets of code, routinely used by developers to track website performance, could be sending to Facebook through online appointment schedulers and patient portals highly sensitive patient information. As we noted then from the article, “None of the hospitals using the Pixel have patient consent forms permitting the transmission of individual patient information, nor business associate agreements (BAAs) that permit this data’s collection.” Facebook’s defense is that it does not use this information in any identifiable way.  

Developments have moved quickly since then. According to The Markup, 28 of the 33 hospitals in the initial report have removed the Meta Pixel from their appointment schedulers or blocked it from sending patient information to Facebook. At least six of the seven health systems had also removed the pixels from their patient portals. In August, Novant Health notified patients of a code misconfiguration of their Meta Pixel tracker that may lead to unauthorized disclosure of their personal health information (PHI) [TTA 19 Aug]. North Carolina’s attorney general may investigate. Five class action lawsuits have been filed by patients, including against Novant and Medstar [TTA 23 June].

It may be that Meta may have a very hard time ‘splainin’ to Sen. Ossoff how the data flow and is used for any given account, based upon their own internal engineers’ assessments in a leaked 2021 privacy memo. But given Meta’s and the founder’s pull in the Federal government, one wonders how far all of this will go. Your Editor is not optimistic. TTA’s articles on Meta Pixel

Weekend reading: HHS Office of Information Security presentation on security risks in AI, 5G, nanomedicine, more

September 20, 2022 | by

Earlier this month, the US Department of Health and Human Services (HHS) Office of Information Security’s Health Sector Cybersecurity Coordination Center issued a presentation/paper that discussed the cybersecurity risks for healthcare organizations in implementing artificial intelligence, 5G cellular, nanotechnologies in medicine (nanomedicine), ‘smart hospitals’, and quantum computing.

Each area is defined, benefits listed, and then security concerns.

Highlights of the cybersecurity risks:

  • AI: requires very large collections of data in order to learn; privacy and security concerns regarding personal health information (PHI); de-identified data can be re-identified (as TTA posited several years ago!)
  • 5G overlaps with IoMT (internet of medical things) tech: both devices and data need to be secured end-to-end as they connect to the network and on devices themselves; design and implementation of the software in medical devices should include a specification of cybersecurity features and validation of those features; regular updating needed
  • Nanomedicine: remote connectivity leading to ransomware and the disruption of nanotechnology devices with theoretically fatal consequences; weaponized inhalable particles as a delivery system for bioterrorism
  • Smart hospitals: an expanded attack service; considerations same as above; resilience and continuous monitoring critical
  • Quantum computing: affects all cryptographic algorithms, requiring review and updating of those that are part of  information infrastructure

Emerging Technology and the Security Implications for the Health Sector (34 slides)  Also Becker’s Health IT

ATA organizes Telehealth Awareness Week this week

September 20, 2022 | by

The American Telemedicine Association has, without a lot of advance fanfare, put together Telehealth Awareness Week this week from Monday 18 through Saturday 24. The purpose of the week is to showcase the many ways virtual care improves access to quality healthcare services for all individuals, including members of rural and underserved communities.

Events both virtual and local are listed here including two later events:  ISfTeH’s Global Connections for Sustainable Telehealth, 6-7 November, in-person in San Jose [TTA 12 Aug], and Forefront 2022: Provider-to-Provider Telemedicine Summit, held virtually on 12 October. The Week’s 53 endorsing and founding partners are also supported by 71 Congressional Policy Champions. ATA release (PDF) 

Breaking: Judge permits UnitedHealth acquisition of Change Healthcare, denies DOJ motion (updated)

September 20, 2022 | by

US District Court judge dismisses Department of Justice motions to prevent UHG acquisition. The decision on Monday by Judge Carl Nichols of the District of Columbia district court denies DOJ’s action to stop the deal. It also orders the planned divestment of Change’s ClaimsXten claims payment and editing software to an affiliate of TPG Capital for $2.2 billion in cash.

The DOJ and entities such as the American Hospital Association had objected to UHG’s folding Change into OptumInsight as anti-competitive. As both Optum and Change offered competing claims processing software that covers 38 of the top 40 health insurers, UHG would then solely have access to nearly all competitive payers’ information. There were other competitive issues that were dismissed in the judge’s brief opinion. (For insight, see our earlier coverage starting here.) The full opinion, originally expected in October after the bench hearing in August, is under seal due to proprietary, sensitive information and will not be released. (US v UnitedHealth Group, 22-cv-481)

DOJ’s top antitrust official, Jonathan Kanter, said they are “reviewing the opinion closely to evaluate next steps”.  DOJ’s short statement surely sounds like the DOJ will appeal. UHG and Change are moving forward “as quickly as possible”. Stay tuned.  Reuters, Healthcare Dive

Update: As reported in HISTalk from Bloomberg the all-cash deal is $7.8 billion, not the earlier reported $13 billion.

News roundup: Oracle’s modernizing Cerner’s tech, but VA hedges training with AWS; Redesign Health’s $65M raise; Kyruus buys Epion Health; Zócalo Health raises $5M seed; Cigna Evernorth adds to digital formulary

September 20, 2022 | by

Oracle’s Q1 2023 earnings call (Motley Fool transcript here) wasn’t much of a surprise. Earnings were up 23% to $11.4 billion. Cerner contributed $1.4 billion but was partly responsible for a 34% rise in operating expenses along with their business mix of our business. The Q2 forecast is 21% to 23%. But what should not be a surprise to anyone was the rapid Oracleization of Cerner’s tech. Answering a question about what value Oracle is delivering to Cerner’s products, Larry Ellison outlined that Cerner will have its first “pretty complete” health management product out within 12 months, using the Oracle Autonomous Database that runs itself without human labor, plus an all-new application development tool called APEX, a low-code tool. Ellison claims that the APEX low-code tool has security built into the tool, thus not requiring audits, and if the application fails, it rolls over into another data center and keeps running. In contrast, using standard methods, the product would take three to four years to build. Becker’s Health IT

The Department of Veterans Affairs (VA) is relying on Amazon Web Services for training services in transitioning from VistA to Cerner Millenium. The AWS programs will train VA Office of Information Technology staff in three areas: ENCOR implementation, operating Cisco enterprise network core technologies, architecting Amazon Web Services, and Red Hat System administration. The training will cost $54,000 over a base period of about two months. Becker’s Health IT

Redesign Health’s Series C racks up $65 million from General Catalyst, CVS Health Ventures, UPMC Enterprises, TriplePoint Capital, Eden Global Partners, Euclidean Capital, Declaration Partners, and Samsung Next. Redesign is an unusual enterprise that creates startups from its own research, assembles management teams, brands, and funds them. Since 2018, they have created 40 healthcare startups. The funding will be used not for funding additional startups but to expand Redesign’s capabilities in startup creation. Some of their startups: Ever/body (cosmetic dermatology), Calibrate (weight loss, which brutally lost a quarter of the company in July), Jasper (cancer care), Vault Health (virtual diagnostics), and MedArrive (EMS dispatch). Fast Company, FierceHealthcare.

Kyruus adds patient engagement to provider search with Epion Health buy. Kyruus, headquartered in Boston, connects providers in healthcare organizations with people needing the right care, as well as for organizations to maintain provider information and data management. Epion Health, headquartered in Hoboken NJ (near NYC), developed a platform to connect patients with their providers including services such as online check-in, telehealth, integrated reminders for scheduling, and patient education. The acquisition expands Kyruus to 500 health systems and medical groups. Terms and management transitions were not disclosed. For Kyruus, which acquired patient navigation too. HealthSparq from investor Cambia Health Solutions, this helps them build out an end-to-end provider-patient platform. Kyruus release, Mobihealthnews

Startup Zócalo Health raised seed funding of $5M to launch virtual healthcare in California, Texas, and Washington. Zócalo (Spanish for plaza or town square) will offer in those states “virtual first family medicine service designed by Latinos, for Latinos”. Already operating in California, Texas and Washington will be added by end of year. Promotoras de salud will serve as health coaches to their patients. Mobihealthnews

Cigna’s health services/tech arm, Evernorth, announced that it is adding two digital health apps to its formulary: UK/US Big Health’s Sleepio for insomnia and Daylight for anxiety, Quit Genius’ alcohol use disorder and opioid use disorder programs, and HealthBeacon’s injectable medication adherence tool for inflammatory conditions. They also announced pilot programs for Jasper Health (Redesign Health, above), Zerigo Health for psoriasis and eczema, Hinge Health’s new women’s pelvic health program, and Lid Sync’s medication adherence tool. Mobihealthnews

Elizabeth Holmes’ three swings and a miss in overturning her trial verdict reveal a crafty strategy

September 16, 2022 | by

Putting off the inevitable? Elizabeth Holmes’ legal team in the past two weeks has filed a flurry of motions in US District Court to have her verdict thrown out prior to sentencing on Monday 17 October.

  • The filing on 1 September sought to have the verdict of guilty on four counts [TTA 4 Jan] tossed with no new trial. This was denied in a preliminary ruling by Judge Edward Davila, stating that the verdict by the jury was supported by the evidence. A final ruling is pending arguments by the defense and prosecution.
  • The three filings on Tuesday 6 and Wednesday 7 September seek to have Judge Davila rule, on the basis of new evidence, for a new trial.

According to the Mercury News, the first motion on Wednesday, which states that arguments presented in the Sunny Balwani trial could have acquitted her, has little chance of being successful and in fact may be counterproductive in annoying the judge in that case–also Judge Davila. The second motion filed has a better shot, including on appeal. It centers on the “Brady rule” that requires prosecutors to disclose and turn over information that could be helpful to the defense. This was the database of patient test results that the prosecution failed to preserve. It didn’t factor in the trial, but could in the expected appeal. 

The filing on Tuesday is straight out of an episode of Perry Mason. Holmes’ partner (and father of her one-year old son) Billy Evans declared that former Theranos lab director Dr. Adam Rosendorff showed up at the door of her home in a ‘desperate and disheveled’ state. In the declaration, Evans stated that “He said he wants to help her. He said he feels guilty. He said he felt like he had done something wrong. He tried to answer the questions honestly but that the prosecutors tried to make everybody (in the company) look bad” and that prosecutors “made things sound worse than they were.” Legal experts interviewed by the Mercury News believe it’s not the remorse, but the pressure prosecutors may have put on the witness. A hearing on this would be extensive and involve both prosecution and defense. Of course, this neglects that during the trial, the defense attempted to rip apart Dr. Rosendorff’s testimony as self-serving and essentially incompetent.

Net-net, Elizabeth Holmes has a best-money-can-buy legal strategy designed to delay her serving time, if not negate it, on the four of 12 counts on which she was convicted.  Mercury News 1 Sept, Mercury News 10 Sept  Adam Rosendorff’s testimony during trial summarized in Chapters 1 and 2