#46 - Data, Data, Everywhere

Apple and Verily want your data, UHC won't share its data, and more...

Things That Happened

Data mine. UnitedHealth Care will stop sharing de-identified claims data with the Health Care Cost Institute, a research organization studying healthcare spending in America. Perhaps UHC decided that data was too valuable to give away for free. 

Blue suede sensors. Verily wants to walk a mile in your shoes. The company is trying to find someone to take them into the shoe business, specifically so they can load those shoes up with sensors that’ll gather health data. The company also recently got FDA clearance for EKG sensing on its study watch (currently in use as part of Project Baseline). More thoughts on what Verily is trying to accomplish below. 

500 million leaf clover. Clover Health announced $500m in new venture funding this week. Between this round, and the $500m recently raised by Devoted Health and Bright Health, that’s a billion dollars invested in just three insure-tech companies since… October. 

Watch your health. Aetna policyholders will be able to use an Apple Watch app - Attain - to track their activity and earn rewards (like getting reimbursed for the expense of the Apple Watch.) One key aspect of the deal: policyholders will be able to incorporate Aetna’s health records into their Apple health records. I suspect this is Apple’s main motivation in the deal, as it will allow them access to a rich trove of data that’ll provide a much more comprehensive experience for users. 

Selling candy and tooth fillings. CNBC reports that Walgreens and CVS are adding dental services to their roster of in-store offerings. While CVS is piloting integrations with SmileDirectClub, Walgreens is putting entire clinics inside their walls through a collaboration with Aspen Dental. 

Dental services is a huge market. It’s also one where both providers and consumers are accustomed to a standard retail experience (a much greater portion of dental is paid for with cash as compared with medical services). I wouldn’t be surprised if dental grows more quickly than medical services in terms of retail-integration. 

Things Worth Understanding

Comparing Verily to Apple, their shared ambition is to gather health data. Their strategies, however, are entirely different, and follow with their overall larger corporate genealogy. 

Apple, always optimizing for user experience, wants your health data as a way of enhancing the utility of their devices. Hardware is becoming less and less of a differentiation point for selling devices, and so they need to make the surrounding ecosystem of apple devices and services even stickier and more tightly integrated with your life. Knowing that your personal health data - both what you generate with your apple devices and your health records pulled via the health records API - is easily accessible in the apple ecosystem makes the decision to leave the ecosystem that much more complicated.

Verily on the other hand, doesn’t just want your health data; they want everyone’s health data. Much like their corporate progenitor Google, Verily is all about gathering as much data as possible and wringing insights out of it. They then take this data and insight to commercialization partnerships, like Onduo and Dexcom, where they can be put to use as a way to get products into the field that can collect even more data. 

If you were forced to sum up the comparative health strategies of Apple and Verily in a dangerously reductionist sentence, you could argue Apple is the full stack solution while Verily is the picks and shovels play. 

Things To Read

What’s your risk score? Mohana Ravindranath reports in ProPublica that companies have begun aggregating data to create “risk scores” that ostensibly tell physicians how likely you are to become addicted to opiates.

Ambrosia, the startup that promises to help you fight aging by infusing you with the blood of young people, has reportedly completed 150 infusions. I’m including the story here because it’s an interesting jumping off point into the big business of blood. If you’ve never considered how the blood donated by volunteers makes its way to the people who need it, start here in exploring this interesting and complex set of resource allocation, supply chain, and ethical problems. 

When non-profit insurers converted to being for profit, premiums increased. Here’s Leemore Dafny’s paper examining the role of insurance company ownership in health care costs. 

“Could the use of A.I. in medicine worsen health disparities?” Dr. Dhruv Khullar writes in the NY Times about how artificial intelligence is not a panacea for bias. This is abundantly evident once you understand the process by which machine learning models are created - they are imbued with the biases of their creators and the data on which they are trained. At their core, these models are no different than traditional programs - they produce the desired outcomes as dictated by the programmers.

“What's the actual evidence that M&A is an effective strategy?” David Willis unpacks and examines the reasons often cited for hospital mergers. Stripping away the various forms of operational “synergy” he finds the only reliable benefit to hospitals is increased market power when negotiating with payers. Given payers are consolidating as well, where does this spiral end? When you have effective monopolies among both payers and providers, who wins? Certainly not the patient.

Thanks for reading The Healthcare Handout, a bi-weekly update on tech and business in healthcare from Isaac Krasny. Criticize, praise, hire, or otherwise get in touch with Isaac via isaac@healthcarehandout.com, or on twitter @isaackrasny

And remember, this machine runs on sharing. If you found this newsletter informative or thought-provoking, give it a boost by sharing with a friend or colleague. Or share a testimonial.

#45 - Apple is a hardware/services company

Apple’s doing services, Omron’s blood pressure watch, and Verily, warily.

Things That Happened

Miscomprehend. My last newsletter, back in the heady days of 2018, discussed the implications of Amazon’s Comprehend Medical service. Should it work as described in their blog post, Comprehend Medical is the medical scribe of the future. Should it work as described. One intrepid Handout reader/cardiologist got in touch to say he’s been testing the new service and, while it’s better than previous attempts at automated documentation, it’s not living up to AWS’ promises. 

Watch your blood pressure. Omron’s blood pressure watch is now available for purchase. Don’t get me wrong; this is a technical achievement and will make it easier than ever before for people to regularly check their blood pressure. But don’t expect it to become more than a niche product for those who have $500 to spare and need to regularly check their blood pressure on-the-go. Let’s get excited when Apple puts the same functionality in their next watch. 

And in case you were wondering, Dr. Topol approves: 

Warily, Verily. Stop me if you’ve heard, but Verily raised a cool billion. You may be asking yourself: but what does Verily actually do? Their business model can best be described as collecting information. They’re gathering up data through partnerships and their own projects like Baseline. What they’re planning on doing with it? Anyone’s guess. Can collecting information be a lasting business model in health? We’ll have to wait and see. Here’s some of my speculation from March when Verily was rumored to be getting into the insurance business. And here’s a recent interview with Verily’s CMO Jessica Mega.  

Whole Lotta Whole Foods. WSJ is reporting that Amazon plans on adding new Whole Foods locations throughout the country. While the move is reportedly focused on extending the reach of their 2-hour delivery service PrimeNow, it’ll also put physical Amazon locations nearer to more Americans. If Amazon does decide to get into care delivery, these locations could serve as their beach-heads. 

Speaking of Corporate Care… CVS CEO Larry Merlo laid out the company’s vision for the future at the JP Morgan conference, and care delivery is a big part of it. Here’s his deck from the conference. They’re building a concept health hub in Houston:

Listlessly Listing Prices. A new law has gone into effect requiring hospitals to post their price lists online. Here’s the chargemaster from my local hospital. 500 pages, largely meaningless (to me) procedure and device names, and the prices themselves don’t reflect the discounts my insurer has negotiated, nor how much I’d actually owe after co-insurance, deductibles, etc. Let’s hope nobody is considering this progress. 

Things Worth Understanding 

It’s a fairly safe prediction that Apple will become much more of a services company in 2019. iPhone sales growth appears to have peaked amid a larger trend in mobile where hardware is no longer the key differentiator - it’s the power of a phone’s virtual assistant, the variety of its app offerings, and the larger device ecosystem in which it exists that increasingly drive demand for phones. 

One reason this is such a safe prediction is that Tim Cook has said as much: “You will see us announce new services this year. “ At least some of these services will have a health focus, as Apple grows on the base of their health records service and Apple Watch EKG. Don’t forget Apple has an expansive health lab and has “dozens of doctors” on staff to guide healthcare efforts. 

Ben Thompson and James Allworth dive into Apple’s uncertain future in the most recent episode of Exponent. In it, Thompson makes the argument that as the larger ecosystem becomes more important in defining the user experience of a device, Google and Microsoft, with their much closer ties to users’ calendars and professional lives, have a distinct advantage. Perhaps Apple is attempting to leapfrog these two by focusing on health, an aspect of our lives equally if not more important than scheduling, and one without a dominant digital player. 

Apple may see health as their wedge for creating a unique user experience. Specifically, they can become the consumer-oriented digital health platform that doesn’t yet exist. One thing is for certain: while we’ve been able to evaluate Apple’s moves in the past as those of a firm primarily focused on selling hardware, this may no longer be the case. 

Things To Read

Of the $1.18 billion invested in health tech companies in the fourth quarter of 2018, the vast majority, ~$900M, went to services companies. A whopping $500M is split between just Devoted Health and Bright Health, both of which are applying technology to improving insurance and care delivery. In this case, the market seems to be a solid indicator of systemic priority: the biggest problems to be solved in healthcare lie in the basics of how we deliver and pay for care. Mobihealthnews has the complete Q4 funding list

While we’re talking about venture capital, you probably saw this NY times piece on the many startups choosing to bootstrap rather than take venture investments. Especially for digital businesses, it’s easier to bootstrap than ever before; you can grow a business from minimum viable product to fully-featured powerhouse all while bringing in revenue to support operations and growth. But does this hold true in health? Given the predominantly b2b sales environment, and stringent regulations, it’s infinitely more difficult for digital health companies to develop iteratively and earn early revenue. Perhaps one of the reasons venture capital investment in health tech continues to grow is that it’s one of the sectors where venture investment is still nearly a requirement. 

Undeerwhelming-Horowitz. Ben Horowitz (of legendary VC firm Andreessen-Horowitz) interviewed Kaiser-Permanente CEO Bernard Tyson on the A16Z podcast. Sadly, these two have nothing more than a surface-level conversation about KP’s unique business model - if you’re looking for a meaty conversation on health, tech, and payment models, keep looking. 

And if you have any good healthcare podcast recommendations, please send them my way. I’m getting desperate. 

In case you weren’t convinced, here’s an article in JAMA talking about how and why personal health records are coming of age in the era of smartphones. 

Thanks for reading The Healthcare Handout, a weekly update on tech and business in healthcare from Isaac Krasny. Criticize, praise, or otherwise get in touch with Isaac via isaac@healthcarehandout.com, or on twitter @isaackrasny

And remember, this machine runs on sharing. If you found this newsletter informative or thought-provoking, give it a boost by sharing with a friend or colleague. Or share a testimonial.

#44 - The Sound of Cardiologists Everywhere Screaming

Apple’s EKG is out, AWS is going to fix EMR, and the medical school business model is dead

Things That Happened

The sound of cardiologists everywhere screaming. The Apple Watch EKG feature went live this week. Consumers seem to love it, while physicians are less enthusiastic. Want to scare a cardiologist? Show her this

Expanding Circles. Oscar Health is adding a new service tier to its small employer insurance offering. Circle Plus is an upgrade to the standard Circle plan, and includes expanded provider choice. Oscar’s narrow-network plans are one of their key strategies for containing costs, so this could indicate they’re finding it difficult to court employers to their plans. Most healthcare consumers associate the quality of a health plan with the breadth of choice of in-network providers and the size of the deductible, so offering a costlier plan with more choice may be enough to convince employers, and their employees, that Oscar is a viable option for employer-sponsored insurance.

Rideshare Healthcare. Lyft hired Megan Callahan, the former Chief Strategy Officer at Change Healthcare, to run their healthcare business. Given her experience at Change, Callahan is an expert on the billing and revenue side of healthcare. And that’s why Lyft, and other ride-share firms, are so interested in the area of non-emergent medical transport; much of it is billable to insurance companies. And even when it isn’t directly reimbursed, it’s still well worth it for a physician to provide transport when it earns them a visit fee they wouldn’t have seen if the patient didn’t show up for the appointment.

More reason to stare at your phone. Researchers at Stanford designed a machine learning algorithm to detect depression using video recorded from a conversation with a physician using a smartphone. While it’s still very much in the research phase, it’s demonstrative of the reality that our smartphones are, and will be, excellent diagnostic sensing tools. 

Share it on Facebook. The initial products of the FastMRI collaboration between NYU medical school and Facebook have emerged in the form of an open sourced set of MRI data and baseline machine learning models. Facebook claims in their blog that it’s the largest MRI data set ever open-sourced. 

Psychiatry in Aisle 5. Walmart, continuing their inexorable march towards healthcare dominance, is piloting an in-store behavioral and mental health clinic in a single store in Texas. The clinic is focused on less complex mental health diagnoses, and will refer patients to standard mental health practices should they require more complex care. It’s essentially the same model Walmart is already employing with medical care. 

Robots giving you medication? Pillo, the automated pill dispenser slash chatbot, is now available for purchase. The major question Pillo’s executive team should be sweating is whether Pillo offers an experience superior enough compared with PillPack and an Amazon echo dot ($30 total cost) to justify the huge price delta. Pillo starts at $500, and has a $40/month subscription fee starting in year 2. 

Things Worth Understanding

Last week Amazon Web Services announced a new HIPAA-compliant service that employs deep learning to interpret and structure physicians’ notes. 

In tangible terms, AWS Comprehend Medical will take physician visit notes and output a structured list including, according to the AWS blog post, “patient diagnosis, treatments, dosages, symptoms and signs, and more. “ Should it work as advertised, and for the purposes of this piece we’ll give AWS the benefit of the doubt, this would allow physicians to return to taking notes as they please and not concern themselves as much with the formatting and structure of their EMR.

It almost sounds too good to be true.

EMRs are a huge problem point for physicians. They’re time consuming, difficult to navigate, and pull physician focus away from patients. When there’s 15 minutes to complete a patient visit, it’s a zero-sum game, and the EMR is winning. 

Comprehend Medical isn’t the first solution to the problem. Atul Gawande explored a number of fixes in his recent piece in the New Yorker: medical scribes who are trained to take notes for the doctor live during the visit, and even an elaborate system in which the visit is recorded and transmitted to a physician in India who creates the medical notes, then sends them back to the physician. Those are fine as band-aids, but they don’t scale. 

Comprehend Medical has the potential to make the interface layer of the EMR user friendly by allowing the user to dictate the terms on which information is inputted rather than the other way around. It’s similar to the promise of the voice interface - you should be able to ask Alexa your weird question, and the burden is on Alexa to figure out what you want. The machine must learn how to respond to your input, rather than the user learning how the machine likes input. 

What’s more interesting here is that it seems AWS has found a way around one of the major strategic problems facing big tech companies as they enter healthcare.

Most tech giants - Facebook, Amazon, Apple, Microsoft, Google - have been built using user experience as their key strategic focus. When shopping at a competitor’s website is as easy as clicking to the next tab, Amazon has always had to focused from top-to-bottom on the customer experience. In healthcare, where consumers have diminished agency to make purchasing decisions (because of information asymmetry, and because they often don’t directly foot the bill), user experience isn’t nearly as much of a wedge - if consumers aren’t the ultimate deciders, then you don’t have be as concerned about keeping them happy. Thus tech companies’ greatest strategic advantage, and the central thesis around which their operations are organized, doesn’t hold true in healthcare. 

One would think that EMRs, which are primarily used by physicians, would need to win physician approval to gain customers. The worst kept secret in health IT is that EMRs are billing systems first, and clinical record keepers second. As the multi-million dollar contracts for hospital EMRs are being negotiated it’s quite obvious from the outcomes that user experience is not a major factor in the decision. 

With Comprehend Medical, however, Amazon has found a way to so dramatically improve user experience for physicians that it can, in fact, act as a wedge. It’s not just that Comprehend will make the physicians’ life easier, but that it will make them happier, more efficient, and could even help health systems avoid expensive intermediary solutions like scribes. 

If Comprehend ends up being the blockbuster it could be, it will put Amazon in a position to dictate the market. They could use it was the killer-feature exclusively available on an AWS electronic medical records, or they could simply sell it as a service to existing EMR players as a way to lure them further into using AWS as their complete platform. Given EMRs are headed in the direction of more customization for different specialties, AWS might be avoiding this product headache and positioning themselves as the common foundational infrastructure on which all EMRs are built. 

Things To Read

“The key to a successful recovery after illness may be a less stressful, more supportive, more humane experience during the hospitalization.” Austin Frakt wrote this week in the NY Times how hospital standard operating procedures like regular vitals checks and blood draws get in the way of patients’ sleep. Consider this another side-effect of the fact that patients’ aren’t the hospitals customers; health plans are. 

of the 100 doctors who received the most compensation from device makers in 2015, conflicts were disclosed in only 37 percent of the articles published in the next year.” Turns out that doctors are pretty bad at reporting when they have a conflict of interest when they publish their research. This comes from another barn-burning investigation from ProPublica. What’s more concerning: doctors aren’t reporting their conflicts, or that there’s so much money flowing to physicians from industry?  

“Many schools provide streaming video of canned lectures, which can be accessed at any time, and do not require the physical presence of students or a professor in a lecture hall.” Milton Packer writes for MedPage Today about the circuitous history of medical education, and the odd state of things today. Perhaps, like the rest of higher education, the model is due for some updating. 

What the market will bear. Johnathon Rockoff followed a new Pfizer cancer drug from clinical trial to launch with a focus on how the drug gets its list price. He unveils a finely-tuned process for discovering the price that will maximize sales without being too low as to leave money on the table. He also notes that little consideration is given to the cost of developing the drug, which is how the industry typically justifies high prices. 

Orphan bugs. In more drug pricing woes, the GAO has concluded an investigation into the orphan drug program and found… problems. Many orphan drug approvals are for drugs already on the market as mass-market drugs, the FDA doesn’t always independently verify the patient population numbers submitted by drug companies, and orphan drugs average prices are 5x higher than those of their mass-market counterparts. The findings suggest the program, in addition to incentivizing pharmaceutical companies to make drugs for small populations, is also incentivizing questionable behavior from pharma. 

“You don’t have to go as far as full integration.” That’s Walgreens CEO Stefano Pessina discussing his company’s recent joint-venture with Humana. This interview makes it sound as through the two ended up together because neither wanted an acquisition, and are willing to explore all the collaborative alternatives that would garner them the benefits of combined market power, short of a full merger. 

Thanks for reading The Healthcare Handout, a weekly update on tech and business in healthcare from Isaac Krasny. Criticize, praise, hire, or otherwise get in touch with Isaac via isaac@healthcarehandout.com, or on twitter @isaackrasny

And remember, this machine runs on sharing. If you found this newsletter informative or thought-provoking, give it a boost by sharing with a friend or colleague. Or share a testimonial.

#43 - Another Brick in the Wal

Humana picks greens over the mart, Verily lost its contact lens, and more from the last two weeks in healthcare

Things That Happened

Another Brick in the Wal. Earlier this year Walmart and Humana seemed locked in an acquisition dance. Now Humana appears to have found greener pastures. WSJ reported this week Humana and Walgreens are talking about exchanging equity stakes in each other, tying their fates together and settling the question of just how Humana will position itself in the new world of vertical insurance integration. 

Maybe Walmart got everything they wanted from Humana when they hired Sean Slovenski, Humana’s head of innovation, to come to Bentonville to lead their health unit. 

Screen time. reSET, the digital therapeutic application from Pear Therapeutics and Sandoz, is now commercially available. The mobile app is approved to treat substance abuse and addiction, and requires a physician’s prescription to download and use. 

Lost contact. Verily and Novartis announced they’ll be stopping work on their glucose-monitoring contact lens after finding the technological challenges too great to warrant continued attention, especially given the other potential applications for their contact lens technologies. Some have snickered at the announcement as an example of big tech’s hubris and inability to find continued success in healthcare. But that’s a shortsighted view. Failure is inherent in innovation. Nevertheless, Alphabet, Amazon, Microsoft, and Apple are the four most valuable companies in the world right now, and they’ve all stated their intentions to get into the industry in one way or another. It’s only a matter of time. 

OK Google. Google’s health unit is bulking up. After luring Geisinger’s David Feinberg to lead the charge, Google is amassing his troops. DeepMind, the UK-based Google acquisition focused on deep learning, has split off its health team to report directly to Feinberg. It’s further evidence that Google wants to start getting serious, and less experimental, about its efforts in healthcare. 

HIPAAWS Amazon Web Services has expanded the number of machine learning services they offer that are HIPAA compliant. These include speech-to-text transcription, translation, and text analytics. 

Twelve leads? Hold my beer. AliveCor’s two-lead EKG device was found to be similar in efficacy to a standard 12-lead EKG in a trial. Yes, this trial was partially sponsored by AliveCor, and it was bounded to treating patients with a type of myocardial infarction, but it’s still interesting that a device I can purchase for $99 (retail) and run with my phone is competing with a legitimate medical device. This sort of innovation, where devices are made vastly less expensive and more portable, is the sort of technological change that begets process overhaul. 

Between this EKG and Butterfly’s portable ultrasound, the number of diagnostics physicians can quickly perform with tech carried in their lab coats is expanding. 

Things To Read

“Health care requires 770 full-time workers per $1 billion of revenue collected, compared with 100 workers in other industries.” This is just one of the many interesting nuggets surfaced in an Econofact report examining the role of administrative costs in the healthcare system. 

Up and to the right. Austin Frakt unraveled the various factors at play in determining why America spends vastly more on prescription drugs than other wealthy nations last week in the NY Times. Hint: It’s the prices. Read his piece to understand exactly why, and how it got this way. 

“We have done over 50,000 sessions of data collection which is almost 100,000 hours of data being collected.” That’s Apple's fitness director Jay Blahnik quoted in Axios. They got a look at Apple’s extensive and expensive health lab where they’re doing lots of secret stuff to develop better fitness and health products. 

“The analysis showed that the price of an average hospital stay soared, with prices in most areas going up between 11 percent and 54 percent in the years afterward” This comes from Reed Abelson’s latest look at hospital prices in the wake of consolidation in the NY Times. 

It makes perfect economic sense that consolidation of supply would increase prices. It’s compounded in its effect by the fact that insurance companies - the aggregated purchasing power that should combat increased supplier power - aren’t terribly interested in actually reining in costs

Amazon's Basic Care over-the-counter drug offerings grew 19% month over month.” The basic care line includes the same generic store-branded OTC drugs like acetaminophen and omeprazole that you’d find in any Walgreens or CVS. Meg Bryant summarizes the analysis on this and Amazon’s other moves in the OTC and prescription drug space. 

Rest Unassured. In his latest disturbing inquiry into standard insurance industry practices, Marshall Allen looks into the duplicitous reimbursement protocols for CPAP machines. Patients are monitored for usage and denied payment for failing to achieve arbitrary metrics, and are forced into rental agreements that value devices at multiples of the retail price. 

This environment where value is out of whack with pricing, and where every player in the value chain points the finger up or down to explain predatory practices, is sadly widespread in American healthcare. It makes it that much easier for reporters like Allen - he could point his investigative energies at almost any condition or treatment and find similarly misleading and flawed payment practices at play. 

Thanks for reading The Healthcare Handout, a bi-weekly update on tech and business in healthcare from Isaac Krasny. Criticize, praise, hire, or otherwise get in touch with Isaac via isaac@healthcarehandout.com, or on twitter @isaackrasny

And remember, this machine runs on sharing. If you found this newsletter informative or thought-provoking, give it a boost by sharing with a friend or colleague. Or share a testimonial.

#42 - Rearranging Alphabet 

Alphabet unifies health efforts, CVS wants to be prime, and more from the last two weeks in health and tech

Things That Happened

Feinberg goes west. David Feinberg, CEO of the Geisinger Health System, will reportedly be taking a job at Google “running healthcare” for the company. It seems this means that Feinberg will be coordinating strategy for all of Google’s health-focused projects, while ensuring communication and collaboration with these projects and Verily and other Alphabet health ventures. Feinberg becomes the latest in an increasingly long list of hospital CEOs getting jobs at tech companies with healthcare ambitions. 

Healthy collaboration. Ahead of Feinberg’s arrival, Alphabet is already taking steps to promote interconnectedness among its many disparate health projects. They’re holding a two day conference to pull together people working on all their health units. It seems, given Feinberg’s hiring and this sort of superficial unification of health efforts, that Alphabet might have some worries about their relatively scattered focus in healthcare. 

33 and maybe. 23andMe received FDA clearance to include section on their genetic reports indicating the status of 33 genetic variants that are associated with the efficacy of about 50 drugs. The clearance came with some pretty serious caveats, including that this is not intended to indicate drug efficacy or advise patients which drugs to take. They might as well have said it’s ‘for entertainment purposes only.’ 

Texting good news. 98point6, a telemedicine company with a focus on asynchronous text messaging (instead of video chats), just raised a $50 million series C round. While telemedicine is certainly a hot area for venture investment, 98point6’s text-based solution is far more in line with what patients want (to not be constrained by physicians’ schedules) and helps physicians better manage their own time as well. 

$2,019. Pfizer has indicated they’ll return to their regular schedule of price increases in 2019, after abating price changes for the second half of 2018 at President Trump’s request. 

CVTest. CVS is testing a membership model that comes with discounts and free delivery on both prescriptions and things purchased online. While Amazon has a much-vaunted logistics operation, it’s important to remember that CVS, Walmart, and Walgreens have untapped potential in their retail locations - namely using them as micro-warehouses and fulfillment centers. This is essentially what Instacart has done for grocery by layering a delivery operation on top of extant inventory. Amazon is racing to build a pharmacy operation to run through their logistics operation, while these chains just need to add a credible last-mile delivery service to their already operating pharmacies. 

Athenawealth. Responding to an HHS request for comments on anti-kickback laws, Athenahealth suggested changes to the laws that would allow doctors and hospitals to pay each other for patient health data. This certainly would be an interesting approach to smoothing the transfer of patient data, it’s always tricky, especially in healthcare, to unfurl the web of incentives to discover what sort of behavior new incentives would promote. 

Also, Athenahealth may finally have a buyer. Or two. 

Things To Read

“I’ve come to feel that a system that promised to increase my mastery over my work has, instead, increased my work’s mastery over me.” Atul Gawande dives into the problem of electronic medical records and their deleterious effect on physicians. While you may think you’ve read this story before, Gawande goes deeper than just complaints about face time with patients and ruminates on the nature of technology, process, systems, and group actions. This piece is botha survey of the current state of embrace of medical software, but also an important consideration of the role of technology in work. 

“A study of radiation oncologists found that only 5 percent thought that they might be affected by gifts. But a third of them thought that other radiation oncologists would be affected.” Aaron Carroll writes in the NY Times about how there are two problems with conflicts of interest: they are fairly widespread among physicians, and more troublingly, physicians seem to think they are above their influence. 

For three months’ supply the savings of $13,500 more than covers the $500 reward and transportation, typically less than $300 per person.” This is from a program implemented by a public employee health plan in Utah, who finds that for many treatments it’s far more cost effective to not just send patients to Mexico, but to pay them a cash reward to do so. 

While this is a particularly newsworthy example, healthcare has seen similar programs before. One prime example is SmartShopper, a service acquired into Vitals, that offers patients cash incentives for using the service to select providers that offer lower cost care. In a market where prices are highly differential and quality metrics are hazy at best, there’s opportunity for arbitrage, and plenty of money left over to incentivize patients to play the game. 

“We estimate conservatively that excluding coverage of pre-existing conditions results in 38% lower premiums relative to ACA-compliant plans.” The mechanisms by which short-term health plans save money are readily apparent, but the Kaiser Family Foundation dissects them to understand where the savings are coming from, and what policyholders are sacrificing for lower premiums. 

“I imagined us creating a Smart City of Privacy, as opposed to a Smart City of Surveillance.” That’s Dr. Ann Cavoukian, a privacy expert who recently resigned as a consultant for Sidewalk Labs in protest over their expansive data gathering policies. Sidewalk, an Alphabet subsidiary, is planning to build a prototype smart city in a Toronto neighborhood. 

Privacy will be an important issue as large tech firms, especially those who generate revenue through gathering user data, enter healthcare. It seems the predisposition for data gathering is baked into Alphabet’s DNA. What does this mean for Sidewalk spin-out Cityblock Health? And for Verily, and Google’s internal health tools? I expect privacy issues will be a core point of contention as Google gets more directly into healthcare. 

health care is still eating the economy, and that’s still cause for alarm.” Columnist Noah Smith examines the macro trends in health spending for Bloomberg and confirms that, yes, it’s really that bad. 

What color is your drug? Jacob Bell takes a look at how drug manufacturers - and their branding consultants - choose which color their pills will be. There are certainly heady waves of marketing bullshit, but perhaps some actual benefit to varied pill colors when it comes to compliance and safety (but that’s not why they choose the colors they do). 

Thanks for reading The Healthcare Handout, a weekly update on tech and business in healthcare from Isaac Krasny. Criticize, praise, hire, or otherwise get in touch with Isaac via isaac@healthcarehandout.com, or on twitter @isaackrasny

And remember, this machine runs on sharing. If you found this newsletter informative or thought-provoking, give it a boost by sharing with a friend or colleague. Or share a testimonial.

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