Weekly Health Tech Reads | 3/30/20

News:

• The Justice Department this week accused Anthem of Medicare Advantage fraud for improper risk adjustment tactics that netted Anthem an additional $100 million in revenue each year. Each year, Anthem (and every Medicare Advantage insurer) 'chases' medical charts for patients to ensure they get the proper diagnosis, because sicker patients = more revenue for the insurer. The Justice Department is arguing that in this process, Anthem only looks for charts to add diagnoses for a patient, and ignores ones where they need to remove diagnoses (which would lower their revenue). Regardless of whether this is actually deemed fraud, it provides an interesting look into the business model of Medicare Advantage payers - Anthem internal documents show the program generates a 7:1 ROI each year. Link.

• Ready Responders, an at-home urgent care model, announced it raised $48 million this week from Google Ventures, Deerfield, Frist Cressey and Town Hall Ventures. Seems like a sign of the times that the funding announcement talks more about how Ready Responders can help manage COVID-19 than it does the funding. Link.

• Dyson, the company that makes those funny looking vacuum cleaners and fans, was in the news this week as it... designed it's own ventilator from scratch in 10 days. Wait, what?! I am so confused as to how I can read an article like this and watch the United States struggle to find 30,000 ventilators for folks in New York. I just don't get it. Link.

• Abbott announced a COVID-19 test that gives a tell results in ~5 minutes, leveraging it's point-of-care testing system that has 19,000 units across the country. Seems like some hopeful signs this week that the testing issues we've had in this country won't be an issues forever. Link. 

• At home testing for COVID-19 has been a confusing topic for me the past few weeks. Last week, you had startups like Everlywell and Nurx saying they had FDA approved at-home tests they were rolling out soon (link). But earlier this week, the FDA said no tests had been approved for at-home use, and Everlywell decided to donate their 30,000 tests to providers (Link). Then, mid-week, UnitedHealth Group released a study of 500 folks in Washington which suggested that self-administered COVID-19 tests work just fine. Interesting to see UHG as the one doing this study - a reminder of just how far they have gone into the care delivery space. Link. 

• Hazelden Betty Ford recently launched a suite of virtual services to support mental health and addiction treatment. Link.

• Bright.MD, a telehealth startup, announced it's raised $8 million. Like most telehealth startups at the moment, COVID-19 appears to be increasing demand for Bright.MD's services substantially. Link.

• ClinOne, a clinical trial management startup, raised $3.6 million. Link.

• Inbox Health, a patient billing startup, raised $3.5 million. Link.

Opinions:

• It seems like the tone of the COVID-19 debate has shifted slightly this week to folks questioning whether the cure is worse than the disease. There are obviously lots of hard decisions that will need to be made over the coming weeks and months around how we collectively balance having a functioning economy while preventing unnecessary mass loss of life. I found this Medium post to be the most thoughtful and detailed piece this week on the variety of potential responses to COVID-19 and the impacts of those responses. It outlines an approach referred to as the Hammer and the Dance - worth checking out. Link.

• Here's a good relatively quick read on digital therapeutics and how they take the next step in crossing the chasm and driving mainstream adoption as a viable alternative to pharmaceuticals. Link.

• Teladoc's CEO was interviewed earlier in the week, suggesting we're on the verge of a new era for telehealth. They saw over 100,000 visits during the week of March 8th, and their stock price is up 43% since March 16th. Link.

• Like many small businesses in America, independent primary care practices are in a world of hurt. Farzad Mostashari shared a good tweetstorm on how dire the reality is for many practices. See also the podcast below interviewing him for more on the topic. I can imagine the private equity folks (or anyone sitting on a lot of cash to deploy, really) are looking at situations like this and seeing a huge opportunity to roll-up health care markets over the coming months.

  • As an aside, in the tweetstorm it mentions that Aledade rolled out telemedicine capabilities at 135 primary care practices in a 24 hour period. Woah! Yet another reminder that health care delivery folks can in fact move quickly to adopt innovative tools when the incentives align.

• Here are a couple of recent podcasts that honestly I haven't had a chance to listen to with everything going on but seem like they'll be interesting:

  • Farzad Mostashari, the CEO of Aledade, was interviewed on Tradeoffs about the potential upcoming primary care crisis. Link.

  • Ann Mond Johson, the CEO of the American Telemedicine Association, was interviewed on A Second Opinion. Link. 

  • The Wharton Digital Health Pulse had two interviews the past few weeks - one with Dan Trigub, who runs Uber Health (Link), and one with Melyda Barnes, the SVP of Medical Affairs for Ro. Link.

  • A Healthy Dose interviewed Dan Burton, CEO of Health Catalyst. Link.

  • Here's an interview with the CMO of Doctor on Demand, Ian Tong. Link.

Data:

• Good piece on the costs associated with treating people with mental health conditions in the Medicare population, not surprisingly finding that folks with mental health disorders have substantially higher costs. Link. 

• This is an interesting paper from the smart folks down at University of Chicago that attempts to quantify the benefits of social distancing, arguing that the value of lives saved is over $8 trillion. Of course, the estimate is based off the Imperial College report so the 'make sure the cure isn't worse than the disease' folks are gonna be skeptical. Link.

• Strata modeled out the financial impact on COVID-19 cases for hospitals and found that in a worst case scenario, hospitals will lose ~$2,800 per COVID-19 case on average. It suggests the government should increase payments by 35% for COVID-19 DRGs to cover off on some of these losses. Link.