A Gimlety Short Take (not generated by ChatGPT). This Editor has observed developments around AI tool ChatGPT with double vision–one view, as an amazing tool with huge potential for healthcare support, and the other as with huge potential for fakery and fraud. (If “The Woz” Steve Wozniak can say that AI can misuse data and trick humans, Tesla’s AI-powered Autopilot can kill you, plus quit Google over AI, it should give you pause.)
The latest healthcare ‘rave’ about ChatGPT is a study published 28 April in JAMA Network that pulled 195 questions and answers from Reddit’s r/AskDocs, a social media forum where members ask medical questions and real healthcare professionals answer them. The study authors then submitted the same questions to ChatGPT and evaluated the answers on subjective measures such as “better”, “quality”, and “empathy”. Of course, the ChatGPT 3.5 answers were rated more highly–78%–than the answers from human health care professionals who answer these mostly ‘should I see a doctor?’ questions. HIStalk noted that forum volunteers might be a little short in answering the questions. Another point was that “they did not assess ChatGPT’s responses for accuracy. The “which response is better” evaluation is subjective.” The prospective patients on the forum were also not asked how they felt about the AI-generated answers. Their analysis of the study’s shortcomings is short and to the point. Another view on compassion in communication as dependent on context and relationships was debated in Kellogg Insight, the publication of the Kellogg School of Management at Northwestern University, in Healthcare IT News.
Amwell posted a disappointing and sizable $398.5 million net loss in Q1. This was over five times larger than the Q1 2022 loss of $70.3 million and Q4 2022’s $61.6 million. The loss was due to a noncash goodwill impairment charge related to a lasting decline in the company’s share price. Current versus prior year Q1 revenue remained flat at $64 million, $15 million lower than Q4 2022 due to a decline in professional services revenue. Visits were 1.7 million visits in Q1, with 36% through the new platform Converge. Guidance for the year remains at $275-$285 million with an adjusted EBITDA loss between $150-$160 million. Mobihealthnews This contrasts with rival Teladoc’s optimistic forecast released last week, though remaining in the loss column [TTA 4 May].
Avaya emerged from Chapter 11 on Monday. According to the release, the company has financially restructured and now has $650 million in liquidity and a net leverage ratio of less than 1x. This was a lightning-fast bankruptcy and reorganization, usually referred to as ‘pre-packaged’, as it was announced in February with the company emerging from it in 60 to 90 days. Avaya provides virtual care and collaboration tools (and has contributed to our Perspectives series).
Another restructuring continues at Centene. Their latest sale is Apixio, a healthcare analytics platform for value-based care. The buyer is private equity investor New Mountain Capital. New Mountain has $37 billion in assets under management. Centene acquired Apixio in December 2020 in the last full year of CEO Michael Neidorff’s leadership. Since 2022, Centene has been selling off many of their more recent acquisitions such as two specialty pharmacy divisions, its Spanish and Central European businesses, and Magellan Specialty Health. Transaction cost and management transitions were not disclosed. Based on the wording of the release, Centene will continue as an Apixio customer as well as other health plans. Given the profile of the 10 largest health plans, which includes Centene, and their diversification, Centene’s divestments coupled with the involvement of activist investor Politan Capital Management have led to speculation.
Another take on Bright Health’s projected divestiture of its California Medicare Advantage health plans is from analyst Ari Gottlieb on LinkedIn. If Bright sells the MA plans for what they paid for them–$500 million–according to Mr. Gottlieb they can pay off their outstanding JP Morgan credit facility as well as negative capital levels in many of the states where they had plans and are now defending lawsuits. It still leaves them $925 million in debt.
Unfortunately, we close with yet another round of layoffs.
- Covid-19 test kit/home diagnostics Cue Health will be surplusing about 26% of its current workforce, or 325 employees. Most will be in the San Diego manufacturing plants. This is on top of 170 employees released last summer. The current value of the Nasdaq-traded company is estimated at $105 million, down from $3 billion at their 2021 IPO. Current share price is $0.68. HIStalk, San Diego Business Journal.
- Another telemental health company is shrinking–Brightline–reducing their current workforce by another 20%. This affects corporate staff and is in addition to the 20% let go last November. Brightline’s focus is on mental health for children and teens, and has investment to date of $212 million. Becker’s
- Healthy.io, which offers in-home urinalysis and wound care, plus a new app for kidney care, laid off 70 staff while enjoying a fresh Series D raise of $50 million from Schusterman Family Investments. Becker’s
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