TTA’s First of 2022: Holmes convicted on Theranos fraud, M&A likely leveling off, Babylon picks up Higi option, Vera buys Castlight, can you spare a few billion for Watson Health?, more!

 

 

Weekly Alert

The new year enters with another bang–Elizabeth Holmes is found guilty on four investor fraud counts. Some carryover M&A with Babylon picking up their option on Higi and Vera buying into health data Castlight. Will telehealth and digital health funding continue to accelerate, or pull back for some needed reflection?

What’s next for telehealth in the (almost) aftermath–and rating the US states on policies (Maybe it’s time to look at other growth opportunities)
Short takes: 2022’s big kickoff with Babylon-Higi, Vera-Castlight buys; will funding slow down in ’22, eye-tracking telehealth for MS, vital signs tracking lightbulbs at CES 2022, and three catchups! (Did you bid a spare few billion for Watson Health?)
The Trial of Elizabeth Holmes, ch. 17: looking inside the juror decision process (Hardly ’12 Angry Men’, just jurors doing a hard job)
Breaking–The Trial of Elizabeth Holmes, ch. 16: guilty on four charges of 11 (Not the end of the legal story, but perhaps the end of the beginning)

2021 exits with a bang, between Omicron (Moronic?) and the blockbuster Oracle buy of Cerner. What will need to be resolved? Winter is the Season of Concern about the remotely located older and disabled, whose digital phones will go out when the power does, often with no backup of cell service. 

Further insights on and thoughts about the Oracle acquisition of Cerner (Much to be resolved with Cerner’s healthcare clients as Oracle buys in, their way)
Does the digital telecom switchover threaten the lives of the most remote old and disabled? (UK, updated) (Winter brings the bad combination of distance, isolation, bad weather, and technology that doesn’t compensate. And it’s the same in the US and EU.)
(Breaking) Sold! Cerner to Oracle for $28.3 billion. And is Epic next? (A curious press release, and Judy Feinberg, what now?)

The Theranos trial winds up after 14 weeks with prosecution and defense summaries–the jury will deliberate starting Monday. Oracle may be buying Cerner in a $30 billion deal. And in payer news, UHG has to delay Change closing, Centene’s CEO is retired in big shakeup, and Amazon finally brings healthcare under one leader.

News roundup: UnitedHealth Group pushes off Change closing again, Amazon’s new healthcare head, Centene’s shakeup of CEO, board, holdings
Theranos, The Trial of Elizabeth Holmes closes, ch. 15: she believed! in the technology!
Oracle in negotiations to buy Cerner for $30B 
Theranos, The Trial of Elizabeth Holmes closes, ch. 14: was it fraud over business failure–or building a company, not a criminal enterprise?

Holmes, and her defense, rests, but not after Blaming Balwani and not remembering a great deal, including all those Theranos investors. As activity winds down at year’s end, we turn to the UK scene: government funding of social care tech, investigating design bias in medical device use, and Vinehealth’s £4.1M in its seed round. In the US, one specialty EHR buys another specialty EHR software developer in further consolidation.

Short takes: £150 million for UK social care tech out of £1 billion, bias by design in medical device use investigated, Netsmart buys Remarkable Health, Vinehealth seed rounds £4.1 million (Mostly UK updates here, but why no $ mentioned by Netsmart?)
Theranos, The Trial of Elizabeth Holmes, ch. 13: a crescendo of ‘I don’t knows’ and ‘I don’t remembers’…and the defense rests! (updated) (The health tech Trial of the Century begins to wind up in time for Christmas)

Holmes testifies about her Boss Lady Life At Theranos, staying on strategy with deflection, blaming others, and a soupçon of diminished capacity. Athenahealth sold to new investors, VA reorganizes to restart their Cerner implementation, CVS and Microsoft do another deal. A POV on patient engagement. And disappointingly, Owlet’s baby monitor sock runs afoul of the FDA.

Owlet sock pulled from US distribution after FDA warning letter (Owww! A setback for a high flyer)
News and deal roundup: Best Buy’s $400M for Current, VA’s Cerner restart 2022, CVS-Microsoft product deal, and Athenahealth (finally) sold for $17B (Deals may be winding down, but they’re still rich)
Theranos, The Trial of Elizabeth Holmes, ch. 12: all bucks stop with the CEO (updated) (It’s beginning to feel like Twinkie Defense Variations)
Perspectives: How enhanced digital communications can improve patient engagement (Avaya’s insight on designing your communications)
Theranos, The Trial of Elizabeth Holmes, ch. 11: Holmes’ widening gyre of diffusion of blame–and abuse (A lurid Svengali story that woke up the jury)
Theranos, The Trial of Elizabeth Holmes, ch. 10: Holmes testifies about the salad days of Theranos, setting up cognitive dissonance (When in doubt, deflect from the forgery with idealism)

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

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

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

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What’s next for telehealth in the (almost) aftermath–and rating the US states on policies

crystal-ballWhat’s in that cloudy crystal ball?  Last year, especially the first half, saw telehealth acquisitions, stock prices and valuations hit the roof. The roof proved to be high but sturdy, as they bounced right back down, not unexpectedly. 

But gee whiz, Fast Company’s article seems to be shocked, shocked at all this, calling it a bubble. This Editor sincerely doubts that any investor that tracked telehealth over the last 10 years would have NOT expected this ride on the rollercoaster after the urgent care and practice offices reopened starting in mid-2020 and worked slowly through 2021. The rebound, as with health insurance payers, took a few months to work through into 2021. Telehealth usage in 2021 receded steadily to single digits, and at last report to just above 4% of claims as of October 2021 (FAIR Health US claims data).  What remains is the continued dominance of mental health–62% for mental health codes. It’s turned out that Babylon Health‘s SPAC was the last of the major action for 2021, getting in under the wire in October. 

It’s obvious that investors will be more realistic in assessing telehealth companies, looking at the areas that sustained telehealth usage, such as behavioral health. Another surprising niche is LGBTQ telehealth–Grand Rounds’ buy of Included Health in May, which then led to the entire company, including Doctor on Demand, adopting the name [TTA 20 Oct].

The other move that telehealth companies are making is to take more of the patient than a few virtual visits. They’ve moved into offering primary care teams to patients in employer plans (Babylon360 and Teladoc’s Primary360). Amazon Care moved into in-home health and clinics with Crossover Health. Amwell acquired SilverCloud for expanding behavioral health capabilities internationally, and stuck a toe into care management with their Converge platform and acquiring startup Conversa‘s health coaching app. The flip side is retail health migrating into in-person and virtual primary care–CVS Health and Walgreens, via VillageMD.

What also held telehealth back for over a decade of less than 1% was reimbursement by Medicare, Medicaid, and private insurers. The pandemic broke through that barrier. While it has narrowed considerably, CMS will still reimburse audio-only telehealth for behavioral health services, addiction treatment, and in-home health visits. State policies on telehealth practices can positively influence telehealth growth for patients and physicians. Free-market organizations Reason Foundation, Cicero Institute, and the Pioneer Institute have reported on all 50 on several policy metrics: 

  • In-person requirements
  • Modality neutral (asynchronous or synchronous, technology including audio, video, store and forward, and remote patient monitoring.)
  • No state barriers
  • All providers can use telehealth
  • Independent practice (including nurse-practitioners)
  • No coverage or payment mandates
  • Cross-state compacts

Rating the States on Telehealth Best Practices

Short takes: Athenahealth close to sold, Teladoc wants More of the Patient, CVS fewer store customers

Some thought starters for your weekend…

Reportedly, EHR and systems provider Athenahealth is thisclose to being sold. Via Becker’s Health IT, Seeking Alpha, a stock analysis site, connects the dots. In September, Bloomberg reported that private equity firms Veritas Capital and Elliot Investment Management (Evergreen Coast Capital) were considering selling Athenahealth for $20 billion or filing an initial public offering (IPO), two dramatic ways to exit. They entered in 2019 for $5.7 billion when it was already public, taking it private and combining it with a GE acquisition, Virence Health.

Timing is now Q1 2022. The most interested investors apparently are Hellman & Friedman, Bain Capital, KKR, Thoma Bravo, and Brookfield Asset Management. While no longer the powerhouse it once was in EHRs and related systems, it still can fetch a good return and provide a favorable exit for the two companies. Athenahealth had no comment for Becker’s. 

Teladoc and Big Telehealth wants More of the Patient, but will it be profitable? Our Readers are well aware of the War of the Roses (because it’s gone on so long) among the traditional telehealth players: Teladoc, Amwell, Included Health (Grand Rounds-Doctor on Demand), MD Live, with other smaller players jumping out of the juggernauts’ way and sticking to their knitting. With the addition of primary care (and, one can assume, the pandemic push), health systems and companies like Amazon Care and Babylon Health have jumped into the mix with ‘hit them where they ain’t’ offerings–Amazon offering house calls and services direct to employers, and Babylon 360 being offered to health plans and employers. Babylon and Teladoc’s Primary360 cover much the same ground, though, in connecting the patient users with an assigned doctor and primary care team for ongoing care.

As noted last month [TTA 7 Oct], the walls between payer and provider in primary care are collapsing in multiple ways in telehealth and payer models like insurtechs. Another model is Amwell’s reinforcing behavioral health capabilities (SilverCloud) and sliding into care management (Conversa and Amwell’s Converge platform).

Readers do not have to go far for confirmation that Teladoc aggressively wants most or all of the patient and isn’t going to settle for less. This is conveniently summarized by HISTalk from Teladoc’s Investor Day (with Editor’s emphasis)

image

Teladoc’s investor day presentation predicts that consumers will expect virtual-first encounters whose quality equals in-person ones and that offer them a variety of coordinated care services. The company says it has evolved from fee-for-service video visits and will become a partner with its customers in offering whole-person care at under value- and risk-based arrangements. It says it will be “the first place consumers turn to for all healthcare needs” for “whole-person care that is personalized, convenient, and connected.” TDOC shares dropped 8% on the day and have shed 25% in the past 12 months, with the company’s market value being $20 billion versus the $18.5 billion in cash it paid to acquire Livongo in late October 2020.

As we’ve previously noted, Teladoc has never made a profit. Many felt it overpaid for Livongo and cut loose too many in the leadership with truckloads of gold. Investors weren’t quite on board with the whole-person vision either, looking at the share price trends. 

CVS Aetna, on the other hand, wants fewer store customers, more patients. Their announcement this week is that they are closing 10% of their stores (900 of 9,900) to focus on urgent/chronic care HealthHUBs, expand those services, and cut down on the brick-and-mortar. This responds to Walgreens buying a majority interest in VillageMD/VillageHealth with adjacent full-service primary care practices and CareCentrix for home care [TTA 14 Oct]. Reuters

Say goodbye to the local, easily navigated ‘boulevard’ CVS, often furnishing food, writing tablets, wrapping paper, and paper towels along with prescriptions and shampoo, often patronized by an older age group, for a barn-like, coldly-lit superstore that you have to drive to. (And say goodbye to pharmacy head Neela Montgomery.) And why is every HealthHUB this Editor has seen unimpressive–strangely under-staffed or no-staffed, tatty waiting areas with a couple of plastic chairs, expanded with ugly outside trailers that cut down on parking spaces?

Cui bono? According to CNN Business, it’s Dollar General, which loves those local locations and has been planning to beef up its health-related OTC meds. They also now have a chief medical officer who is evaluating in-store eye exams, telemedicine, and partnerships with local pharmacies. Given inflation, more customers will be checking Dollar General out.

Short takes: Now J&J splits up, a Color(ful) $100M, Cue Health goes DTC, Amwell’s busy Q3, Teladoc’s Investor Day 19 Nov

Breaking up seems to be the thing this month. Now Johnson & Johnson is spinning off its consumer brands into a separately traded public company, retaining the pharmaceutical and medical device businesses. The consumer business includes such J&J global signature products such as Band-Aids, Neutrogena, Q-tips, Baby Powder and Shampoo, and the Listerine line of products. It’s expected to take 18 to 24 months. The pharma/med device business will retain the J&J brands, sub-brands like Janssen, and development in AI and robotics. The consumer products divisions will have to hunt around for a new one. Outgoing CEO Alex Gorsky must be heaving a sigh of relief and dreaming of a long vacation, as he won’t have to shepherd this one– incoming CEO Joaquin Duato starts in January. Pharma/med device is much larger, with $77 billion in revenue. Consumer accounts for $15 billion, with four products alone accounting for $1 billion each. The reason behind it, of course, are the talc lawsuits around Baby Powder and Shower to Shower which have been adroitly hived off, but continue. CNBC, Reuters

Population health and genomics is more Color(ful) than ever, with the company’s $100 million Series E topping off last year’s $167 million Series D for a total of $497 million since 2014 (Crunchbase). Valuation of the company is now at $4.6 billion. Color’s platform is targeted primarily to the public sector–health agencies, research institutions, employer organizations, health systems, and others for custom-built software that can integrate patient information and genomics with lab results and education.  It previously teamed up with the National Institutes of Health for the ‘All of Us’ project collecting research data from a broad scope of the US population. Mobihealthnews

San Diego-based Cue Health, which up to now was known for a molecular COVID-19 at-home test, is expanding its direct to consumer market with a virtual health platform featuring their COVID-19 test (on FDA EUA, CE marked) starting on 15 November. It’s expanding ‘on cue’ with a membership offering, Cue+, with 24/7 online medical consults, e-prescriptions, what they term CDC-compliant test results for travel through in-app video proctoring, and same-day delivery of their products. Membership starts at $49.99 per month for the lowest level plan, escalating to $89.99/month for supervised COVID-19 testing. To make this work requires a Cue Reader that costs $249 along with testing packs priced at $225 for three. Cue also has in development testing for other factors–where it started prior to the annus horriblis of 2020. Not for those on a tight budget, but if you need it…. Cue release, Mobihealthnews

Amwell’s busy Q3 in visits reflected the uptick in the ‘delta’ variant of COVID-19, but was disappointing on the earnings side as urgent care brings in less revenue than behavioral health or specialty care. Amwell’s year-to-year revenue was down less than 1% to $62.2 million, but the decrease is forcing a revision in 2021 full year forecasted revenue. The Converge platform [TTA 29 April] has reached 4,000 providers and 43 enterprise clients which was far more than forecasted. Newly acquired SilverCloud and Conversa Health [TTA 29 July] are integrated into Converge and already cross-selling. Amwell, however, remains in the red with a quarterly net loss of $50.9 million. Healthcare Dive  

The Telehealth Wars continue to see-saw, with Teladoc’s Investor Day on Thursday 19 Nov next week. According to Seeking Alpha, a stock analysis site, “Bank of America is cautious on TDOC ahead of the event, citing questions about the near-term margin trajectory and competition. Shares of Teladoc rose 22% in the three weeks following its last investor day.”

Amazon Care confirms five more cities, beefs up DC lobbying–but what’s the real game?

Amazon Care will be expanding in 2021, confirming five new locations–and maybe more. Kristen Helton, the director of Amazon Care, confirmed at HLTH21 that 2021 rollouts of the virtual + mobile care service would include Dallas, Chicago, Philadelphia, Boston, and Los Angeles, ‘to name a few’. Ms. Helton confirmed that Washington DC and Baltimore region are live. The website does not state active cities, only permitting a zip code search and confirmation. Pharmacy delivery is also available in select, but not stated, areas. Healthcare Dive

Amazon Care originated with Amazon employees as a telehealth service, with in-person available to employees in the Seattle area. By March, they opened the full service (Video and Mobile Care Medical) to other Washington state companies. At that time, they announced that Video Care will be available nationally to companies and all Amazon employees by the summer–and claimed that in-person services would be rolled out to multiple cities by the summer. That did not happen. 

In June, at a Wall Street Journal Tech Health event, while being coy about the rollout, Amazon Care VP Babak Parviz said that the service would look like:

  • Clinician chat/video connected within 60 seconds
  • If an in-person visit is required, a mobile clinician arrives within 60 minutes, who can perform some diagnostic tests, such as for strep throat, provide vaccinations and draw blood for lab work. For other diagnoses, that clinician is equipped with a kit with devices to monitor vital signs which are live-streamed to remote clinicians.
  • Medication delivery within 120 minutes

Basically, what is not being said is that Amazon has been slow walking Amazon Care, probably wisely. With telehealth visits, mobile care, and pharmacy, there are multiple and complex elements to mesh seamlessly, which is after all Amazon’s Promise. What’s not so seamless is paying for it. While for Amazon it is with immediate payment for service, it is not for the patient–obtaining reimbursement, if available, is left up to the patient–at least for now, as reports indicate they are negotiating with Aetna. Amazon Care is also its own closed network.

There’s also the blunt fact that Amazon is moving into territory well staked out by major players that integrate employers, insurance, primary care, and pharmacy: Teladoc, Amwell, Included Health (Grand Rounds + Doctor On Demand), MD Live. They are now joined by UnitedHealth Care’s announcement a few days ago of NavigateNOW, a new virtual-first commercial plan rolling out next month to employers in nine markets and 25 markets by end of 2022. It offers 24/7 primary care, urgent care, and behavioral health care services through Optum as well as UnitedHealthcare’s national provider network. Many services and medications will have $0 copayments. Healthcare Dive, FierceHealthcare

However, if the cost of Washington lobbying is any indicator, Amazon is blasting off in healthcare. According to a report in OpenSecrets.org, “Amazon, which is creating its own health care service, is the biggest corporate lobbying spender so far in 2021. The company has spent nearly $10.2 million on lobbying in the first six months of the year, and spent $18.7 million in 2020.” The (unfortunately paywalled) report in STAT confirms the hire of Claire Winiarek from PCMA to be their new director of health policy.

This Editor’s opinion remains as in June–that Amazon’s business plans for Care and Pharmacy, and generally in healthcare, are really about accumulating data, not user revenue, and are certainly not altruistic no matter what they say. Amazon will accumulate and own national healthcare data on Amazon Care and Pharmacy users far more valuable than whatever is spent on providing care and services. Amazon will not only use it internally for cross-selling, but can monetize the data to pharmaceutical companies, payers, developers, and other commercial third parties in and ex-US. That’s a very different game than traditional insurers and the telehealth giants.

What’s next for telehealth? Is it time for a correction?

crystal-ballThe boom may be over, between shrinking visit volume and a pileup of providers. Is a correction in the cards? The flood of funding that started in 2020 and has not abated was kicked off by the pandemic and a massive shift to telehealth visits in March/April 2020 from a barely-above-plant-life number in January/February.

Post-pandemic, the shift corrected.

  • The peak of 69% of visits tracked by Epic in April had tailed off to 21% as early as May 2020 [TTA 2 Sept 20].
  • National commercial claims data via FAIR Health was lower. They tracked its peak also in April 2020 at 13%, falling continuously monthly: May to 8.69%, 6.85% in June, 6% in August, and 5.61% in October [TTA 9 Jan].
  • By mid-year 2021, the claims numbers continued to lose altitude: June 4.5%, July 4.2% (FAIR Health monthly report).

Despite the numbers, telehealth companies raised $4.2 billion of a total $15 billion in digital health funding in the first half of 2021, according to Mercom Capital Group, a global communications and research firm. So…what’s the problem with les bon temps rouler?

CB Insights notes the increased specialization of new entrants and, as this Editor has noted previously, the blending and crossing of business lines.

  • Companies like Heal, Dispatch Health, and Amazon Care will send a clinician to your house for a checkup–no running to your urgent care.
  • Kidney disease? Monogram Health. Musculoskeletal pain? Hinge Health. Child with an earache or fever? Tyto Care. Check symptoms first? Babylon Health.
  • Telemental health has gone from cocktail party repellent to the belle of the ball, concentrating on cognitive remote therapies. For the past year, it moved to more than half of all telehealth claims, with currently over 60% of procedure codes–and it’s consolidating. AbleTo was bought by Optum, Ginger bought by Headspace, SilverCloud by Amwell.

So for the Major League–Teladoc, Amwell, Doctor on Demand, Grand Rounds, and MDLive–what does this mean? If this interview with Teladoc’s CIO is an example, they plan to segue to a ‘hybrid’ model of virtual quick response plus integrating providers into a continuing care model with patients, creating a relationship with history and familiarity. A model that’s very much dependent on IT, analytics, and connecting with willing providers. But in this free-floating sea of verbiage, it didn’t come into misty focus till the very end, when he mentions Primary360 [TTA 7 Oct] and a virtual primary care team. (And let’s not forget Babylon360 along similar lines.) He finally sketches a view of all the connections to conditions coming together on a very far horizon. 

One can say it’s a cloudy crystal ball, indeed. FierceHealthcare, HealthcareITNews (Teladoc CIO interview)

Is healthcare too much for Big Tech’s Google and Apple? Look at the track record. And David Feinberg’s $34M Cerner package.

With Google scattering Google Health to the four winds of the organization--the heck with what employees recruited for Health think of being reorg’d to, say, Maps or YouTube and falling through the corporate rabbit hole–more detail has leaked of Apple’s struggles. This time, on the scaleback list (a/k/a chopping block) is Health Habit. It’s an app in the Apple Store that connects users with AC Wellness, a doctor’s group in Cupertino, California. The ‘eligible participants’ are restricted to Apple employees. From the app site, they can check weight, nutrition, blood pressure, and schedule wellness checks. It seems to be the typical ‘skunk works’ project that’s not ready for prime time, but its public fate seems to be poorly timed and simultaneously, overblown because they are–well–Apple

Bottom line, is healthcare once again proving rather resistant to being leveraged by technological solutions? Those of us who go back to the Stone Age of health tech, or those of us who joined in the Iron and Bronze Ages, remember when you couldn’t get into a conference cocktail party without a “wellness” app. (You say you’re in behavioral and remote patient monitoring for older adults? Oh, look! A squirrel!)

Microsoft was going to dominate consumer health with their HealthVault for personal health records (PHRs). We know how that turned out–dead apps, Fitbit an also-ran bought, Pebble and Misfit going to the drawer of failed toys, Jawbone t-boning plus Intel and Basis written off in 2017, and HealthVault unlamentedly put out with the trash at the end of 2019. Oh yes, there was an earlier Google Health for PHRs, which died with a whimper back in 2012 or so.

The press releases crow about Big Tech’s mastery of complexity, yet going off on their own without partners–or even with partners–never seems to work. In the industry, it makes for a few good articles and the usual rocket launching at places like Forbes, but the pros tend to treat it with a shrug and pull out a competitive plan. Glen Tullman, founder of Livongo who will never have to worry about paying for chateaubriand for two for the next billion years or so, stated the obvious when he said that patients cared about the overall experience, not the tech.

Speaking of experience, Amazon Care promises the best for its employees and enterprise accounts–a one-minute telehealth connection, a mobile clinician if needed within the hour, and drugs at the door in two hours. All with direct pay. This has met with skepticism from telehealth giants like Teladoc and Amwell with established corporate bases. There’s also CVS Health and Walgreens. The Editor has opined that care isn’t Amazon’s game at all–it’s accumulating and owning national healthcare data on Amazon Care and Pharmacy users that is far more valuable than whatever is spent on providing care and services [TTA 16 June]. Will Amazon really be able to pull it off?

Paddy Padmanabhan, the author of Healthcare Digital Transformation, lists a few more reasons It’s Too Hard For Big Tech In Healthcare in his HealthcareITNews article here….

  • Healthcare is a part-time job for Big Tech
  • Big tech firms want to solve the healthcare problem by themselves
  • Selling technology is not the same as selling healthcare services

…but holds out some hope that the initial success of “digital-first and virtual-first providers of healthcare emerging as challengers” will point the way for them.

And speaking of Google Health and former employees, Cerner’s necessary SEC disclosure today of new CEO and president David Feinberg, MD’s compensation package was sure to create some talk in Googleville among his now-scattered team. $34.5 million over the next 15 months is structured as follows:

  • $900,000 base salary
  • a target cash bonus of $1.35 million
  • a one-time cash bonus of $375,000 stock
  • $13.5 million in Cerner’s restricted shares for 2022
  • $3.375 million in stock shares for the fourth quarter of 2021
  • a new hire award of $15 million in restricted stock shares to offset his equity loss with Google. 

Whew! Becker’s HealthIT

News roundup: update on UnitedHealth/Change Healthcare DOJ check, Tunstall adds new CTO, Amwell’s gloomy second half, Teladoc’s Aetna deal, Fitbit and LifeScan diabetes

Just the news, no deals. UnitedHealth Group’s $13 billion acquisition of diversified health IT/imaging/payments company Change Healthcare has hit another snag. Back in March, the US Department of Justice requested specific information as part of DOJ’s review of the merger under the Hart-Scott-Rodino Antitrust Act (HSR). Both UHG and Change have agreed with DOJ to not certify compliance with the request before 15 September, then wait an additional 120 days, based on a 7 August Securities & Exchange Commission (SEC) filing. This could be shorter if DOJ formally advises them that their investigation is closed. Announced in January as a giant addition to UHG’s Optum unit, this now looks like the sale will close sometime in December–if it is not derailed. Becker’s Health IT with a brief recap. This was not a good week for UHG as they had to pay $15.6 million to settle a US Department of Labor finding that they did not pay out-of-network mental health claims at parity, wrongfully denied others, and flagged still others for utilization reviews. FierceHealthcare

Tunstall Healthcare announces a new Group Chief Technology Officer. Gary Steen joins Tunstall from broadband provider TalkTalk where he was Group Managing Director for Technology. He will lead Tunstall’s innovation and development function globally including all solutions and products from Tunstall’s technology delivery centres in the UK, Sweden and Germany. Previously, he was with MDS Global, a software services business active in Europe, Australia, and the US. Tunstall release.  Hat tip to Jenny Marston at Lucky North.

Amwell projects that Covid-19 will depress second half telehealth results by 200,000 visits and $8 million. CEO Ido Schoenberg MD made this surprising projection on the second quarter investor call, but the projection may be sound. His rationale is that there will be not much of a cold and flu season, as the latest virus variants will have people masking up and social distancing (and presumably avoiding indoor crowds. As we’ve noted previously, the Brothers Schoenberg tend to be contrarians on various headline trends (e.g. looking askance at Amazon Care biting into the enterprise telehealth business and hospital-grade in home care). One would assume that if more stay away from in-person care, telehealth would increase beyond the current claims rate of 5% especially in mental health which is half of telehealth claims. But this could be some clever sandbagging for investors, as he went on to say in the call that if the impact of Covid isn’t as bad as we think, there’s always the flu! FierceHealthcare

Amwell’s frequent sparring partner in various courts, Teladoc, announced that they would be powering Aetna Virtual Primary Care for their Aetna members in national self-funded employers. This is a trifecta of Teladoc’s physician-led care team model, Aetna’s provider network, and CVS Health services at MinuteClinics and where available, CVS HealthHUBs. The virtual visits will have no co-pay for as well as select in-person CVS Health services. CVS Health release, FierceHealthcare

Fitbit is, believe it or not, still around. They announced a partnership with LifeScan diabetes monitoring to integrate its health tracking apps with the company’s glucose monitoring devices for diabetes management. The Fitbit tools that track activity such as daily activity, nutrition, and sleep will provide tracking of impact on blood glucose levels. FierceHealthcare

Telehealth Wars: Amwell’s raises game with buys of SilverCloud and Conversa Health (updated); Teladoc’s slow member, hospital growth lead to $133M Q2 loss

Updated. Amwell’s announcement today (28 July) of the twin acquisitions of SilverCloud Health and Conversa Health for the tidy total sum of $320 million in cash and stock was, if not quite a ‘see ya and raise ya’ move, a confirmation that Amwell was going to raise its game, at long last, versus Teladoc. SilverCloud provides digital telehealth programs for common behavioral health conditions. A spinoff of Trinity College Dublin, it counts as US clients Kaiser Permanente, Optum, and Providence Health, plus over 80 percent of NHS’ mental health service. Conversa is a StartUp Health portfolio company that developed a scalable care management triage system for at-risk patients that provides automated patient outreach and engagement tools that can move them to higher levels of care where needed. Clients include Northwell Health, UCSF Health, UNC Health, Merck, MedStar Health, and Prisma Health. 

For Amwell, this expands their capabilities in the hot behavioral health area and, with Conversa, into a care management platform targeted to providers, pharma, and payers. They see digital workflows, patient engagement, a longer-term relationship with their consumer base through the continuum of care, through these two companies’ hospital, health system, health plan, and employer clients.

The wrinkle? Neither company is all that far along–SilverCloud has total funding of only $26 million but is more established with 750,000 clients and 300 organizations. Conversa’s Series B was a tiny $8 million for total funding of $34 million. Amwell also paid a premium price. According to Healthy Skeptic, a blog written by long-time UnitedHealth Group senior healthcare executive Kevin Roche, their combined revenue was $15 million–more than a 20x multiple of the purchase price. The other challenge for Amwell? Making all the systems work together in a meaningful way–and to market what can be a confusing picture properly. Amwell press release, Mobihealthnews

Update 2 August. The Irish Times, undoubtedly working a local contact at Silver Cloud, ascertained that Silver Cloud was purchased by Amwell for a price in excess of $250 million. That means a tidy payday of €23 million ($27.3 million) for the company’s founders – Ken Cahill, James Bligh, Karen Tierney, Dr John Sharry, and Gavin Doherty. If that is so, Conversa was bought for $70 million or less. One wonders why a shell game tactic was used, as Conversa is known to be an early-stage company. Hat tip to HISTalk today.

For Teladoc, growing beyond urgent care, plus integrating the former Livongo and InTouch Health, presents difficulties. Telehealth usage continues to shrink as in-person visits rebound save for behavioral health, which is also bad news for the payers as utilization goes up. Teladoc now struggles to add new members after last year’s pace. Their hospital business that came with last year’s acquisition of InTouch Health is growing more slowly than expected [TTA 16 July]. The expected cross-sales traction with the former Livongo hasn’t caught fire yet, but that may change with myStrength Complete and the myStrength app going live with health plans or employers starting this month. The first enterprise customers are a major Blues plan (likely HCSC) and a Fortune 100 employer. [TTA 14 May]. Teladoc is also growing into other areas with more continuous user engagement, such as chronic care, weight management, and primary care. That program, Primary360, is in “very very late-stage” discussions with multiple payers. Teladoc, which has never been profitable, lost $133.8 million for Q2.   Healthcare Dive

Disruption or giveaway: Amazon Care signs on employers, but who? Amazon Pharmacy’s 6 months of meds for $6. (updated)

Is this disruption, a giveaway, or blue smoke requiring IFR? An Amazon Care VP, Babak Parviz, said at the Wall Street Journal’s Tech Health virtual event that all is well with their rollout of virtual primary care (VPC). Washington state is first, with VPC now available nationally to all Amazon employees as well as companies. However, Mr. Parviz did not disclose the signed-up companies, nor a timetable for when in-person Amazon Care practices will be expanding to Washington, DC, Baltimore, and other cities in the coming months.

Mr. Parviz also provided some details of what Amazon Care would ultimately look like:

  • Clinician chat/video connected within 60 seconds
  • If an in-person visit is required, a mobile clinician arrives within 60 minutes, who can perform some diagnostic tests, such as for strep throat, provide vaccinations and draw blood for lab work. For other diagnoses, that clinician is equipped with a kit with devices to monitor vital signs which are live-streamed to remote clinicians.
  • Medication delivery within 120 minutes

FierceHealthcare

The timing of the Amazon Care rollout has not changed since our coverage of their announcement in March. This Editor noted in that article that Credit Suisse in their overview was underwhelmed by Amazon Care as well as other efforts in the complex and crowded healthcare space. Amazon Care also doesn’t integrate with payers. It’s payment upfront, then the patient files a claim with their insurer.

Existing players are already established in large chunks of what Amazon wants to own.

  • Both Amwell’s Ido Schoenberg [TTA 2 April] and Teladoc’s Jason Gorevic (FierceHealthcare 12 May) have opined that they are way ahead of Amazon both in corporate affiliations and comprehensive solutions. Examples: Amwell’s recently announced upgrade of their clinician platform and adding platforms for in-home hospital-grade care [TTA 29 Apr], Teladoc’s moves into mental health with myStrength [TTA 14 May].
  • Even Walmart is getting into telehealth with their purchase of a small player, MeMD [TTA 8 May].
  • CVS has their MinuteClinics affiliated with leading local health systems, and Walgreens is building out 500 free-standing VillageMD locations [TTA 4 Dec 20]. CVS and Walgreens are also fully integrated with payers and pharmacy benefit management plans (PBM).

Another loss leader is pharmacy. Amazon is also offering to Prime members a pharmacy prescription savings benefit: six-month supplies of select medications for $6. The conditions are that members must pay out-of-pocket (no insurance), they must have the six-month prescription from their provider, and the medication must be both available and eligible on Amazon Pharmacy. Medications included are for high blood pressure, diabetes, and more. The timing is interesting as Walmart also announced a few days earlier a similar program for Walmart+ members. Mobihealthnews.

crystal-ballThis Editor’s opinion is that Amazon’s business plans for both entities and in healthcare are really about accumulating data, not user revenue, and are certainly not altruistic no matter what they say. Amazon will accumulate and own national healthcare data on Amazon Care and Pharmacy users far more valuable than whatever is spent on providing care and services. Amazon will not only use it internally for cross-selling, but can monetize the data to pharmaceutical companies, payers, developers, and other commercial third parties in and ex-US. Shouldn’t privacy advocates be concerned, as this isn’t being disclosed? 

Amwell debuts new telehealth platform, Converge; previews Carepoint for hospital care into the home

Amwell, which of late has been low-profile except for a puzzling interview by Ido Schoenburg, MD about Amazon and others as competitors, announced its new telehealth platform, Converge, at its annual Client Forum. According to the platform web page and the release, their key features are designed to make them extremely attractive and differentiated to clinician users. 

  • A single meeting place for providers and patients across mobile, tablet, and desktop
  • High-quality connections with adaptive video for low-bandwidth situations
  • Integration with existing workflows, EHRs, patient portals, and consumer experiences
  • Open platform and app marketplace. The open architecture and APIs are designed to host apps and services such as Google Cloud, Tyto Care, virtual second opinions from the Cleveland Clinic, and the Biobeat wearable wrist and chest monitors.

What may be even more interesting for Amwell’s future is a TV-based initiative that can bring hospital care into the home. At the same conference, Amwell previewed Home TV Carepoint. Developed in partnership with Solaborate, the software uses advanced AI. Information on Carepoint was limited to a few lines buried in the body of the release, indicating a ‘stealth mode’, but the potential is that it could open up a new market with health systems and home care if leveraged and marketed right. FierceHealthcare

Weekend reading: the strange reasons why Amwell doesn’t consider Amazon a competitor; ground rules for the uneasy marriage of healthcare and technology

Yahoo Finance interviewed co-CEO/founder of Amwell Ido Schoenburg, MD on the company’s 2020 results and forecast for 2021. It makes for interesting but convoluted reading on their growth last year in what is a consolidating field where Amwell was once one of the undisputed two leaders. They now compete against payers acquiring telehealth companies (MDLive going to Optum) and mergers like Doctor on Demand-Grand Rounds that are taking increasing market shares. Then there are specialty providers like SOC Telemed and white-labels like Bluestream Health. However, there are a couple of whoppers in the happy talk of growth for all. Dr. S pegs the current run rate of telehealth visits at 15-20 percent. The best research from Commonwealth Fund (October) and FAIR Health (August) tracked telehealth at 6 percent of in-office visits. Epic Health Research Network measured 21 percent at end of August. [TTA summary here

Then there’s the tap dance around Amazon Care. His view is that telehealth companies all need a connective platform but that each competitor brings ‘modular components’ of what they do best. What Amazon excels at is the consumer experience; in his view, that is their contribution to this ‘coalition’ because healthcare doesn’t do that well. There’s a statement at the end which this Editor will leave Readers to puzzle through:  

“And Amazon and others could bring a lot of value to those coalitions, they should not be seen as necessarily competing unless you’re trying to do exactly what they do. And there are some companies, including some telehealth companies, that that’s what they do. They focus on services. They try to sell you a very affordable visit with a short wait time and a good experience. They should be incredibly concerned when someone so sophisticated as Amazon is trying to compete in that turf.”

The last time this Editor looked, none of these companies were non-profit, though nearly all are not profitable.

Gimlet EyeLooking through her Gimlet Eye, Amazon Care is a win-win, even if the whole enterprise loses money. In this view, Amazon accumulates and owns national healthcare data far more valuable than the consumer service, then can do what they want with it, such as cross-analysis against PillPack and OTC medical shopping habits, even books, toys, home supplies, and clothing. Ka-ching!

A ‘bucket of cold water’ article, published in Becker’s Health IT last month, takes a Gimlety view of the shotgun marriage of healthcare and technology. Those of us laboring in those vineyards for the better part of two decades might disagree with the author in part, but we all remember how every new company was going to ‘revolutionize healthcare’. (The over-the-top blatherings of ZocDoc‘s former leadership provide a perfect example.) The post-Theranos/Outcome Health/uBiome world has demonstrated that the Silicon Valley modus operandi of ‘fake it till you make it’ and ‘failing fast and breaking things’, barely ethical in consumer businesses, are totally unethical in healthcare which deals in people’s lives. Then again, healthcare focused on ‘people as patients’ cannot stand either. Stephen K. Klasko, MD, President and CEO, Thomas Jefferson University and Jefferson Health in Pennsylvania, advocates for a change–far more concisely than Dr. Schoenburg. You may want to pass this along.

Deals and news roundup: Ginger’s $100M, myNEXUS to Anthem, Everlywell snaps up PWN, Amwell’s banner year for revenue–and loss, VA reviews Cerner rollout, voice visits for MA, GE’s vScan goes wireless, uBiome founders indicted

Deals–and news–are piling up like Easter eggs before the hunt. Mental health and cognitive digital therapy scored another raise with Ginger‘s $100 million Series E to fund expansion into health plan and government partnerships. Blackstone Growth led the round. Total funding to date is $220 million. It’s entered unicorn status with a valuation just north of $1 bn. Ginger to date has concentrated on corporate mental healthcare. From being an ugly duckling only a few years ago, digital mental therapies are this year’s ‘it’. But competition is fierce: the traditional telehealth companies such as Teladoc, Doctor on Demand, and Amwell are closing in on the early entrants such as AbleTo. Direct-to-consumer models like Talkspace; UK/Ireland’s SilverCloud Health; and Lyra, Spring Health, and Happify, which just closed a $73 million Series D, all step out with slightly different ‘differentiators’ but target the same companies, health plans, and health systems. FierceHealthcare, Ginger release

Home health is also another former ugly duckling transformed into a swan. Anthem is acquiring home health/nursing management company myNEXUS, which manages home-based nursing services for 1.7 million Medicare Advantage members across 20 states. Their digital authorization and visit management couples with a nationwide network of providers and nursing agencies for local care. Exiting myNEXUS are private equity investors led by New York’s WindRose Health Investors, after four rounds and a conservative $31 million in funding (Crunchbase). Neither terms nor management transitions were disclosed. myNEXUS will join Anthem’s Diversified Business Group. FierceHealthcare, release.

Home testing+telehealth company Everlywell (not connected with the Everly Brothers) has a different take on home health. They are now integrating their self-test kits with fully owned lab testing. New acquisitions PWNHealth and its subsidiary Home Access Health Corporation will join Everlywell in Everly Group. PWN was Everlywell’s main telehealth partner and diagnostic testing partner since 2016. It will become Everly Health Solutions with their testing data kept separate from Everlywell’s. Home Access was PWN’s self-collected lab test company. Everly Health now will support more than 20 million people annually in all 50 U.S. states, Canada, and Puerto Rico. Acquisition terms were not disclosed. PWN’s CEO will take a seat on the Everly Group board to assist integration. Valuation is now estimated at $2.9 bn.  Mobihealthnews, Everly release, Bloomberg News

And in other news…

Amwell reported a Very Good Year in their telehealth services, with visits growing to 5.9 million from 2019’s 1.1 million. Total revenue was up over 65 percent to $245.3 million. However, profitability continues to be elusive, with net loss almost equaling revenue. Release

The Department of Veterans Affairs (VA) finally announced a review of the Cerner-Leidos EHR integration. Back in February, VA was hanging tough on the rollout after the GAO report questioning its wisdom and recommending postponement until high severity issues were corrected. Secretary Denis McDonough, new VA head, has directed the undertaking of a 12 week strategic review without pausing the project. Taking bets on that 12 weeks! Healthcare Dive

Payers and their lobbyists are supporting a newly reintroduced House bill that would permit telephonic-only telehealth visits to be reimbursed for their Medicare Advantage plans after HHS closes the pandemic period. There is considerable information that video/audio virtual visits still have limitations with the 65+ group, clustered around high-speed internet or good data connections, smartphones, and computers with cameras, making video visits difficult or impossible. Which begs the question about continuing coverage for those on Original Medicare. Healthcare Dive

Those readers with long memories will recall GE Healthcare’s heralded introduction of the VScan handheld clinical-grade ultrasound device–back in 2010, complete with Eric Topol rave and demo. Not much has been heard from GEHC since till this month, and other competitors, such as the Butterfly IQ from 4Catalyzer, have made handheld ultrasound common and affordable. GEHC announced Vscan Air, a fully wireless version that connects to iOS or Android. It was FDA cleared in November 2020 and will be shipping its dual-headed probe and accessories starting 1 April for a US-listed target price of $4,495. GEHC page (with the cute domain vscan.rocks), Mobihealthnews

And in our Scandal Sheet section, a Federal grand jury in the Northern District of California has indicted the founders of now-bankrupt uBiome on 40-odd counts encompassing conspiracy to commit securities fraud, conspiracy to commit health care fraud, money laundering, and identity theft. Separately, the Securities and Exchange Commission (SEC) also filed charges. Between 2016 and 2018, uBiome had raised $100 million through a Series C, and was likened to Theranos, after its fall, in the Big Claim (‘inventing the microbiome industry’). Its business was analyzing the DNA of fecal and other biological matter to sequence the bacteria of the body’s microbiome. Starting with low-cost, limited data comparison for at-home tests, the founders progressed to claiming to doctors that their diagnostic tests were clinical-quality and would be reimbursed by payers. Payers did–for awhile–and the investors piled in. By 2019, the wheels fell off their scheme and the FBI came knocking at their Silicon Valley offices after the founders cashed in. Chapter 7 followed in late 2019. The Register reports that the two married founders are on the run, whereabouts unknown. US Attorney’s Office release, SEC filing (PDF)

 

Two major moves and what they mean: Doctor on Demand, Grand Rounds to merge; Amazon Care will go national by summer (updated)

This week’s Digital Health Big Deal (as of Wednesday!) is the merger agreement between telehealth/virtual visit provider Doctor on Demand and employer health navigator Grand Rounds. Terms were not disclosed. It’s important because it extends Grand Rounds’ care coordination capabilities beyond provider network navigation and employee clinical/financial tools for six million employees into an extensive telehealth network with 98 million patients in commercial, Federal, and state health plans.

Both companies had big recent raises–$175 million for Grand Rounds in a September 2020 Series E (Crunchbase) and Doctor on Demand with a $75 million Series D last July (Crunchbase). The transaction is a stock swap with no cash involved (FierceHealthcare, CNBC), and the announcement states that the two companies will operate under their own brands for the time being. Owen Tripp, co-founder and CEO of Grand Rounds, will run the combined company, while Doctor on Demand CEO Hill Ferguson runs DOD and joins the board. The combined company is well into Double Unicorn status with over $2 bn in valuation. Also Mobihealthnews.

What it means. Smaller (than Teladoc and Amwell) telehealth companies have been running towards M&A, with the most recent MDLive joining Optum’s Evernorth [TTA 27 Feb] creating interstate juggernauts with major leverage. Doctor on Demand was looking at their options for expansion or acquisition and decided 1) the time and the $ were right and 2) with Grand Rounds, they could keep a modicum of independence as a separate line while enjoying integration with a larger company. The trend is profound enough to raise alarms in the august pages of Kaiser Health News, which decries interstate telehealth providers competing with small and often specialized in-state providers, and in general the loosening of telehealth requirements, including some providers still only taking virtual visits. Contra this, but not in the KHN article, this Editor has previously noted that white-labeled telehealth providers such as Zipnosis and Bluestream Health have found a niche in supplying large health systems and provider groups with customized telehealth and triage systems.

UPDATED. In the Shoe Dropping department, Amazon Care goes national with virtual primary care (VPC). To no one’s surprise after Haven’s demise, Amazon’s pilot among their employees providing telehealth plus in-person for those in the Seattle area [TTA 17 Dec 20] is rolling out nationally in stages. First, the website is now live and positions the company as a total care management service for both urgent and primary care. Starting Wednesday, Amazon opened the full service (Video and Mobile Care) to other Washington state companies. The in-person service will expand to Washington, DC, Baltimore, and other cities in the next few months. Video Care will be available nationally to companies and all Amazon employees by the summer.

Notably, and buried way down in the glowing articles, Amazon is not engaging with payers on filing reimbursements for patient care. Video Care and Care Medical services will be billed directly to the individual who must then send for reimbursement to their insurance provider. The convenience is compromised by additional work on the patient’s part, something that those of us on the rare PPO plans were accustomed to doing back in the Paper Age but not common now. It also tends to shut out over 65’s on Medicare and those on low-income plans through Medicaid. It is doubtful that Amazon really wants this group anyway. Not exactly inclusive healthcare.

TechCrunch, FierceHealthcare. Jailendra Singh’s Credit Suisse team has a POV here which opines that Amazon continues to have a weak case for disruption in VPC, along with their other healthcare efforts, and an uphill battle against the current telehealth players who have already allied themselves with employers and integrating with payers.

Comings, goings, and more: YouTube goes healthy, COVID vax distribution and EMA hack, IPO/M&A roundup, Japan’s health tech startups highlighted at CES

Short takes on news snippets from just about everywhere. It’s been that kind of a week. (Picture: the famous Raymond Loewy-designed ’49 Studebaker Commander, of which it was joked ‘you can’t tell whether it’s coming or going)

Google-owned YouTube has decided to take a more organized approach to healthcare content with the hiring from CVS Health of Garth Graham, MD, who will serve as its director and global head of healthcare. At CVS, he was chief community health officer and president of the Aetna Foundation. His portfolio will include the development of content from providers including the Cleveland Clinic, the Mayo Clinic, the National Academy of Health, and Harvard’s School of Public Health. It’s seen as a platform for video-formatted health education both US and globally. The importance to Google is evident in the reporting line: Dr. Graham will report to Karen DeSalvo, MD, the chief health officer at Google. One wonders if the next step is the curating (a/k/a demonetizing or removal) of health content not Google-generated. FierceHealthcare, YouTube press release

Some states have done well on COVID-19 distribution. Others haven’t. It apparently doesn’t matter if you’re large or small. In the US, states were given vaccines based on CDC information and consultation with them. The states then designed their own distribution and priorities. Here’s a running tally on Becker’s Hospital Review Meanwhile, back in Hackerville, the European Medicines Agency (EMA) confirmed on 12 January that data relating to regulatory submissions by Moderna, Pfizer, and BioNTech that were on a hacked server was leaked to the internet. Becker’s

In IPO/M&A news:

Centene Corporation is acquiring Magellan Health, a behavioral health, specialty healthcare, and pharmacy management company, for $2.2 billion. Centene continues its transformation into a UnitedHealthcare structured company, with payer programs on one side and health services including population health management, data analytics and other areas of health tech on the other side. Magellan will be operated independently. The deal requires Federal and state review, and is expected to close in second half 2021. Release  Magellan this week announced its lead investment in a $20 million Series B raise by Philadelphia-based NeuroFlow, a clinical behavioral health monitoring system. Philadelphia Business Journal

Amwell announced a public offering of over 11 million shares. The date and pricing for the offering were not mentioned in the release, but at the current share price of $28, this would raise in excess of $308 million. This is on top of their socko IPO last September which raised in excess of $700 million. 

Behavioral therapy continues to be hot, with online behavioral therapy company Talkspace going the SPAC ‘blank check’ route in merging with investor company Hudson Executive Investment. It provides them with $250 million cash. Estimated net revenue is $125 million in 2021, up 69 percent from 2020, creating an enterprise value of $1.4 bn, which is quite a reach. Healthcare Dive, release.

Medicare Advantage payer Clover Health of Jersey City, NJ also went the SPAC route this week with Social Capital Hedosophia Holdings Corp. III, giving it an enterprise value of approximately $3.7 billion. Clover Health styles itself as a health tech company as it analyzes member health and behavioral data to improve medical outcomes and lower costs for patients, many of whom have multiple chronic conditions or are classified as underserved.  Release

Israel’s Itamar Health, which focuses on integrating sleep apnea management into the cardiac patient care pathway, is buying SF-based Spry Health for an undisclosed amount. Founded in 2014, Spry has an FDA-cleared wrist-worn device, the Loop System, that monitors SpO2, respiration rate, and heart rate. Itamar plans to develop a wrist-worn device based on their Peripheral Arterial Tonometry (PAT) immediately, with initial market launch anticipated in 2022. Release

Hinge Health’s Series D raised $300 million and a new valuation of the company at $3 bn. (Remember when $1 bn was a unicorn amount?) Hinge’s specialty is musculoskeletal–a virtual MSK Clinic for back and joint pain care and rehab including access to physical therapists, physicians, health coaches, and wearable sensors to guide exercise therapy. Release

In startup news…Under the radar, Japan has been developing a crop of health tech startups. They were highlighted at this year’s virtual CES by Jetro–the Japan External Trade Organization. Their CES web page has a teaser video and sortable profiles on companies, many of which look very interesting. According to their materials, there are perhaps 10,000 Japan startups but few of them make it out of Japan. This Editor looked forward to their presentation on ‘Turning the Super Aging Society into a Super Smart Society’ yesterday evening, but virtual doesn’t mean that links work or events actually happen, so our reporting will attach some statistics on their super-aging society, as well as a comparison with other countries (PDF).

Amazon’s feint into large employer telehealth; HealthLake dives into structured health data analytics

Much ado about…..? Amazon is reportedly making an effort to lure large employers into its Amazon Care telehealth and in-person care platform. Amazon Care is a health benefit presently offered to Amazon employees, with telehealth nationally and in-person for Seattle area residents.  

About 300 Amazon employees use it, which is low given their employee size and after 15 months. Since internal takeup has to date been limited, this Editor observes that Amazon may be testing the scaleup waters by inviting other companies in. These reports indicate that online real estate marketplace Zillow was approached but has moved no further with it. Companies would be charged a per member per month fee plus a ‘technology fee’. 

For those interested in telehealth’s positioning among US employers, the Credit Suisse report by Jailendra Singh’s team makes important points on where both Teladoc and Amwell stand with employers and health plans–and it’s not promising for Amazon:

  • Telehealth has been adopted by 90 percent of employers, but it’s a fraction of benefit spending for them
  • What’s important to employers is not the cost of the program, but employee engagement, the potential volume of medical cost savings, and management of chronic conditions
  • Telehealth vendors are increasingly ‘carved into’ contracted health plans
  • Between direct employer contracts and health plans, Teladoc is settled into this segment, and diversified into medical systems with new acquisitions InTouch Health and chronic care management with Livongo. Amwell is situated in the white-label provider market with health systems and health plans, with few employer contracts. 

 AMZN Making a Push in Telehealth For Large Employers: Appears to Be More Noise than Substance

A better-positioned initiative for healthcare providers that Amazon just announced is HealthLake, which is a HIPAA-eligible AWS cloud service for storing and analyzing structured and unstructured data at petabyte scale. The ‘lake’ is the data lake in the cloud. It copies health data in the Fast Healthcare Interoperability Resources (FHIR) format, and analyzes unstructured data uses specialized machine learning models, like natural language processing, to automatically extract meaningful medical information. Current users, according to their website, are Cerner, Konica Minolta, and Orion Health. Hat tip to HISTalk.