News and deal roundup, 5 March: Oscar Health’s $1.4 billion IPO, telehealth expansion in Congress, what people *really* do during a telehealth visit

What a difference a month makes in a blazing healthcare market. ‘Neoinsurer’ Oscar Health went public on Tuesday, selling over 37 million shares at $39 each, reaping an eyeblinking $1.44 bn. While shares took a tumble on Wednesday and Thursday, closing at just above $32, the valuation of the company could be anywhere between $7.92 and $9.5 bn (calculating in options and the like). Quite a difference from the estimate in early February, which was a modest–and as now we know, totally sandbagged–$100 million [TTA 9 Feb]. A lovely payday for their backers and all at Oscar who had stock grants, indeed.

As we’ve seen from recent IPOs, they have all been underestimated (e.g. Signify Health’s $100 million filing transubstantiated into $561 million). The downward glide slope in share price is typical. Whether it will rise will depend very much on strong results for this quarter, half year, and full year as Oscar presses harder into the competitive Medicare Advantage, exchange, and small group markets. How they, and all the other payers do, will be dependent on health policy permutations and emanations from the DC Swamp. CNBC, TechCrunch, FierceHealthcare

Speaking of the DC Swamp, telehealth expansion is enjoying real traction in Congress and with Health and Human Services (HHS). The chair of the House Health Subcommittee, Rep. Anna Eshoo (D-Calif.) has called for many of the flexibilities on payments and locations granted temporarily during the pandemic’s liberalization of coverage to be made permanent. These affect Medicare and other types of Federal payments. [Review of the 2021 Medicare Physician Fee Schedule re telehealth here]  They expire after the public health emergency (PHE), extended in January to end of April, so a clock is ticking, quickly.

The basics are that Congress must pass legislation that removes restrictions on geography (currently rural only) and permits the patient home to be used as a ‘distant site’. Advocates also want to add to Medicare telehealth coverage hospice and home dialysis care, more types of eligible care providers such as physical therapists and other allied health professionals, and audio-only (telephonic) consults. Others are pushing for reinstating HIPAA compliance for telehealth platforms.

The Telehealth Modernization Bill that covers most of the above was introduced on 23 February in both the Senate and House, in a rare show of both bipartisanship and bicamerality. (Excluded: telephonic consults, HIPAA compliance) Rep. Eshoo’s remarks were made during last Tuesday’s Committee on Energy and Commerce Health Subcommittee hearing.

HHS is also backing this, based on HHS’ Office of the Inspector General’s recent statement praising the expansion of telehealth. Recognizing that concerns have been raised about ‘telefraud’, IG Christi Grimm noted that they have been vigorously prosecuting fraudulent claims [TTA 2 Oct 20] with telehealth being used in a broad sense for billing other goods and services such as medications and durable medical equipment. FierceHealthcare, Healthcare Dive, ATA News 26 Feb

Speaking of telehealth visits, what do the patients do during them? This Editor had filed away, waiting for an opportune moment to share it, a surprising study by DrFirst, a mobile telehealth and communications platform. It was conducted online during the Pits of the Pandemic (June 2020). It may not surprise you that most patients weren’t fully engaged in the process. Bored, isolated, mostly male patients–73 percent men, 39 percent women–multitasked and distracted themselves during the virtual visit by: 

Surfing web, checking email, texting – 24.5%
Watching the news, TV, or movie – 24%
Scrolling through social media – 21%
Eating a snack or a meal – 21%
Playing a video game – 19%
Exercising – 18%
Smoking a cigarette – 11%
Driving a car – 10% (!!!!)

And the best….Having a “quarantini” cocktail or other alcoholic beverage – 9.4%

Reasons for consults were unsurprising: annual checkup – 38%, mental health therapy – 25%, and specialist visits (e.g., dermatologist, hematologist, or oncologist) – 21%.  N=1,002 US consumers. 44% of Americans Have Used Telehealth Services During Coronavirus Pandemic but Some Admit Not Paying Attention. Also Advisory Board blog.

News Roundup (updated): Proteus files Ch. 11, VA’s EHR tests now fall–maybe, making US telehealth expansion permanent, Rennova’s rural telehealth bet, Oysta’s Lite, Fitbit’s Ready to Work jumps on the screening bandwagon

Proteus Health, the company which pioneered what was initially derided as a ‘tattletale pill’, filed Chapter 11 bankruptcy today (16 June). As early as December, their layoffs of nearly 300 and closure of several sites was a strong clue that, as we put it, Proteus would be no-teous without a big win. Exactly the opposite happened with the unexpected early end of their Otsuka partnership with Abilify [TTA 17 Jan]. Proteus had raised about $500 million in venture capital from Novartis plus technology investors and family offices. Their combination of a pill with an ingestible sensor, a patch that detects ingestion and that sends information to a smartphone app was ingenious, but in a business model was meant for high-cost medications. Proteus’ current partnerships include TennCare (TN Medicaid), plus Xealth and Froedtert to integrate medication information into electronic health records. At one point, Proteus was valued at $1.5 bn by Forbes, making it one of the early healthcare unicorns.  CNBC, FierceHealthcare

VA further delayed in implementing Cerner-Leidos EHR. POLITICO’s Morning eHealth earlier this month reported from congressional sources that further testing would be delayed to the fall at the earliest and possibly 2021. The project to replace VistA stands at $16 bn. Contributing to delay was an April COVID outbreak in Spokane at a veterans’ home, which pushed patients into the VA medical center. 

In further DC news, several senators are advocating that the relaxing of restrictions on telehealth during COVID should largely be made permanent. According to the lead senator, Brian Schatz (D-HI), Medicare beneficiaries using telehealth services increased 11,718% in 45 days. Many telehealth requirements were waived, including geographic, coding of audio-video and telephonic telehealth billing, and HIPAA platform requirements. Other senators are introducing bills to support remote patient monitoring programs in community health centers’ rural health clinics. FierceHealthcare

The climate for telehealth has improved to the point where smaller players with side bets are now betting with bigger chips. Rennova Health, a mid-South healthcare provider with a side in software, is merging its software and genetic testing interpretation divisions, Health Technology Solutions, Inc. (HTS) and Advanced Molecular Services Group, Inc., (AMSG) with TPT Global Tech. The combined company will be called InnovaQor after an existing subsidiary of TPT and plans to create a next-generation telehealth platform targeted to rural health systems. Release, Becker’s Hospital Review

Oysta Technology has launched the Oysta Lite with an SOS button, GPS, safety zone mapping for travel, and two-way voice. The SOS connects to their IntelliCare platform which provides status monitoring, reporting, and device management plus connecting to the telecare service provider. They are specifically targeting post-lockdown monitoring of frail elderly.  Press flyer/release.

Fitbit jumps on the crowded COVID workplace screening bandwagon with Ready to Work, a employer-sponsored program that uses individual data collected via the Fitbit device such as resting heart rate, heart rate variability and breathing rate. Combined with self-reported symptoms, temperature, and potential exposure, the Daily Check-In app then provides guidance on whether the employee should go to work or remain at home. According to the Fitbit release, a higher heart rate–as little as two beats a minute–can be indicative of an immune system response before the onset of symptoms. TTA has earlier reported [19 May] on other COVID workplace screeners such as UHC/Microsoft’s ProtectWell app, Appian, and (in-house) PWC. FierceHealthcare also lists several others on the cart: Castlight Health, Collective Health, Carbon Health, VitalTech, and Zebra Technologies. However, at this stage, few employees are leaving remote work for in office, and fewer still may even return to the office.