Weekly Health Tech Reads | 4/26/20

News:

• Aledade raised $64 million to continue supporting the development of PCP-led ACOs. I’m a big fan of this approach conceptually in terms of trying to support independent primary care docs banding together to manage risk contracts. Given the state of the world and primary care practice financials, I’m a little surprised this round isn’t something like twice the size. If the independents decide to go to work for the local health system or Optum, I’m not sure what role Aledade still has to play. Seems like there’s a big opportunity to combine Aledade’s platform with financial backing for practices (similar to what Altais is up to) in order to to help independent docs stay independent. Link.

• Some more interesting nuggets from earnings calls this week:

  • HCA posted Q1 2020 earnings and shared they’ve started to see a 45% volume decline due to COVID-19 in the latter half of March. Profits were down 45% year over year, even though revenue was 2.7% higher. They suggested they’ll start opening back up in mid-May. Link.

  • Phreesia, a patient intake software company, had their earnings call for their quarter that ended in January, sharing that outpatient visits are down 55% in March (more on that below in the data section). Interestingly, they were asked by an analyst whether they see practices changing to subscription based concierge models in response to financial challenges - answer was a pretty clear no. Link.

• Clever Care Health Plan raised $20 million to build a Medicare Advantage plan. This one is taking an interesting approach - trying to appeal to California’s immigrant population by offering benefits aligned with Eastern Medicine philosophies. As it seems like the other MA startups have been learning, there are a lot of challenges in building an MA plan from the ground up - it will be curious to see if this group can navigate those challenges successfully. Link.

• H1 raised $13 million to create a LinkedIn for medical professionals and is monetizing it by selling information to pharmaceutical companies to better market their products. Oh oops wait no sorry I meant bring novel therapies to market faster to help patients. Link.

• XRHealth, a startup making a virtual reality platform for healthcare, raised $7 million after launching a VR telehealth clinic in the past few months. Link.

Opinions:

• Here’s a lighthearted read from Lisa Suennen on digital health pre- and post-COVID and the best of times / worst of times dynamic for many startups at the moment. Beyond making me laugh out loud a few times, one of the most interesting statements she made was this:Health systems around the country are now seeing thousands of visits a week - a system like Allina Health is seeing almost 5,000 visits per day. Note that in Teladoc’s Q1 earnings call they said they’re doing 20k visits per day nationally - so you’ve got health systems doing up to 25% of Teladoc’s entire volume on their own. Feels like a tectonic shift in this competitive landscape. Link.

• If you have the time to read a novel on digital health this weekend, here is a really good one to check out from Ben Lee. He wrote a six part Medium post on why data is the key bottleneck to the adoption of digital health tools and some ways in which an API layer might create a path forward. Link.

• I feel like I’ve been waiting for an article like this on Christian Sharing Ministries to come out for some time. It explores how insurance regulators and members of these faux insurance plans are now suing them as the Christian Sharing Ministries are refusing to pay out high cost medical claims. Check out the Washington State investigation that suggests one entity was paying out only ~15% of dollars it was taking in from members to pay for medical expenses. Just gross. Link.

• It appears health care leaders are starting to talk in a crisis recovery framework language similar to this perspective from Paul Keckley on ‘Now / Near / Far’ responses to COVID-19. Everyone is focused on surviving the ‘Now’. As they do that, they turn their sights to a ‘Near’ - attempting to return to some normalcy post-crisis. There’s not as much attention being spend on the ‘Far’ yet - the structural changes that this will force on the system - which this post takes an interesting look at. Link.

• This is an interesting glimpse into life as a founder of a telehealth company debating whether to raise more funding in this environment. The article features the founding team of Talkspace, a mental health telehealth startup, who is saying ‘no’ to investors currently. Link.

• Stanford Primary Care wrote up their experience shifting primary care practices to virtual visits to 80% of overall visits in two weeks leveraging Epic and Vidyo. Provides for a more tactical / detailed read on how exactly clinics are making these changes. Link.

• This post offers a brief look into how Oak Street Health’s primary care model has changed since COVID-19 started. It’s really high level, but does offer up that 90% of Oak Street’s visits have moved to some sort of phone / video visit. Link.

Data:

• CommonWealth Fund, Harvard, and Phreesia teamed up to publish some really interesting data on outpatient utilization using Phreesia’s platform. In person outpatient visits are down almost 70%, which is offset by an increase in telehealth visits. So on the whole, visits are down 55% as noted above. The data on visit declines by specialty is also worth checking out. Link.

• Moody’s ran some scenarios looking at insurer profitability due to COVID and found that in general they’ll likely remain profitable in 2020. Link.

• Remember last week when it came out UHG might be re-entering the exchanges? Charts like the one included below maybe have something to do with that decision. The report linked here estimates that insurers will be issuing rebates for $2.7 billion in insurance premiums that were collected because they didn’t pay out 85% of premiums in medical costs. Link.

• This survey of primary care docs suggests that up to 20% of primary care practices may close. Link.

• CBInsights published a map of the top funded digital health startup by state. An interesting mix of companies, including some that aren’t the trendy names. Link.