#36- Just Don’t Pee On Your Phone

Highlights and insights from this week in the tech and business of healthcare

New logo, same handout. Pretty cool, right? Anyways, here’s this week’s edition:

Things That Happened

User antagonistic. A study published this week in JAMA shows that medical scribes help abate physician burnout by reducing the amount of time physicians spend in the EHR. Read another way: EHRs are so user-unfriendly, burdensome, and poorly designed that the quickest way to solving the problem they’ve created is to hire someone to stand between the user and the system. But where there’s a problem, there’s opportunity: physician user-experience could be a strategic wedge for a new entrant to break into the area. 

Just don’t pee on your phone. Inui Health announced this week they’ve received FDA clearance for their at-home urinalysis test. It uses computer vision algorithms in a mobile application to read a color-changing dip stick. Sound familiar? Healthy.io was cleared for their Dip.io test in July, and Scanwell was also cleared this summer for their at-home UTI test. More interesting than the fierce competition in the pee-on-a-stick business: all of these at-home diagnostics heavily rely on smartphone functionality for capturing and analyzing results. Imagine if a company was laying the groundwork for a smartphone-based medical application ecosystem

Still AliveCor and kicking. AliveCor announced this week they have a portable 6-lead EKG device in the works and will be seeking FDA clearance sometime in the future. While the premature announcement was certainly a reaction to the Apple Watch EKG revelation, it seems the device has been in the works for some time. 

Last week I asked how long AliveCor would continue making hardware; that may have been a touch glib. AliveCor’s strategy must shift away from competing against Apple as a device maker, and this 6-lead EKG is a step in the right direction. Apple is focused on regular monitoring, while a 6-lead EKG will satisfy the need for remote clinical-grade measurement when someone has a known condition. I still think there’s a potent opportunity for AliveCor to reside further up the value chain by focusing on applications using Apple’s built-in sensors. 

Memorial Sloan Kerfuffle. Data is valuable. With AI technologies increasing in ability and applicability, the data they’re trained on is turning into a scarce and valuable asset. This is unearthing questions that have never been asked before: if a pathology department has 60 years of data generated by their expertise and labor, who owns that data? Who should see financial gain from that data’s transformation into a machine learning model? Memorial Sloan Kettering is in the spotlight as it faces a revolting pathology department, a venture-backed spin-off, and millions of dollars worth of data on the line. 

Amazon and on and on. Amazon announced a slew of new Alexa-enabled devices this week. These include security cameras, an Alexa interface for the car, and yes, for some reason, a microwave. My personal favorite: a $30 wall clock that counts down your active timer with a ring of LEDs. The bottom line: as Amazon gets deeper into consumer healthcare, having the infrastructure for voice and video-based interfaces already in the homes of millions of Americans will be a huge strategic advantage. It’s much easier to deploy remote monitoring via software update, like their reported upcoming ability to detect the user’s tone and mood, than it is by requiring the purchase of a physical device. 

Don’t Nest on your laurels, Amazon. While Amazon gets the coverage, Alphabet’s Nest is still very much a player in the home devices arena. And Engadget is reporting that Google’s reported acquisition last year of the remote health monitoring startup Senosis Health was actually a Nest acquisition. It’s all totally unofficial at this point, so details are scant, but if true it’ll be interesting to see another Alphabet company (alongside Verily and Calico) getting directly into the healthcare business. 

Fitbit doubles down. Fitbit announced Fitbit Care, a platform they’re selling to employers and health insurers for their employees and policyholders. In addition to fitness tracking, it provides coaching feedback, and also enables the sponsor to see population-level activity metrics. The most interesting competitive note here is how Fitbit is going directly to the enterprise customer. Apple Watches may be more elegant and tied in with your digital life, but they don’t offer employers the same enterprise experience they might require if they’re footing the bill. 

And while we’re talking Fitbit, Peter Rubin writes in Wired about how Fitbit first put wearables in the mainstream, and where that 10,000 step goal actually comes from. 

Circulating Returns. Circulation, the startup that made it easy for a medical practice to arrange transportation for patients, was acquired by incumbent competitor Logisticare for $57.5 million after being founded just two years ago. This sort of startup trajectory is uncommon in healthcare, but so was Circulation’s business. They were able to participate in the industry’s idiosyncratic economy, but without touching on clinical requirements or wading into the morass of medical reimbursement. There is room for traditional venture returns in healthcare, but only when they don’t actually get too deep into the idiosyncrasies that make the industry unique, and thus only when they don’t focus on the problems that require the most attention. 

Pharmacy Benefit Mana-ghouls. The end of the standalone PBM is nigh. Cigna and Express Scripts received a thumbs-up from the Department of Justice allowing their merger, while it’s expected CVS and Aetna will see the same outcome. But while PBMs may be dying, their antics are likely to continue from beyond the grave as their functions are integrated into larger enterprises and their ‘black box’ economics are further obscured. For more, check out Samantha Liss’ analysis in Healthcare Dive. 

Things To Read

“Certain hospital systems are able to command advantageous terms because they have grown through years of deal-making, shifting the balance of power between hospitals and insurers,” writes Anna Wilde Mathews in the Wall Street Journal. As we have long known, there is a correlation between hospital market leverage and prices, with more monopolistic areas seeing higher prices for hospital-based care. As Mathews points out, this goes beyond pure economics as hospitals are using their leverage to limit insurer’s ability to offer networks in which they aren’t included, or even prohibit incentivizing patients to utilize other providers. These steering contracts have attracted legal action from the Department of Justice. 

Insurance plans aren’t exactly innocent bystanders. They have every motivation to accept healthy price increases from hospitals as their profitability is tied to their costs. Perverse incentives, everywhere. 

“if we focus on empowering scientists with tools to unlock their work and the field -- that goal could be within our reach." The goal referenced above is that of curing or managing all disease. This comes from Priscilla Chan, wife to Mark Zuckerberg, and the driving force behind the Chan Zuckerberg Initiative. Christina Farr takes a deep dive into the non-profit, where she outlines how the group is focused on providing funding and engineering talent to facilitate and improve scientific research and development. 

“In the private market, healthcare AI startups have raised $4.3B across 576 deals since 2013, topping all other industries in AI deal activity. “ This comes from a CB Insights report on trends in AI in healthcare. It’s a solid overview of where things currently stand when it comes to this new technology’s inexorable march into the clinic. 

Apple took a little over a week to send me all the data it's collected on me, amounting to almost two dozen Excel spreadsheets at just 5MB in total,” writes Zach Whitaker on ZDNet. Apple has been setting itself apart from other tech giants when it comes to privacy, and it’s not just a show: the company doesn’t store much user data at all. In contrast to Google, Amazon, and the other tech giants eyeing healthcare, Apple walks the walk when it comes to user privacy.

What’s the optimal level of user privacy? It’s not really a fixed amount, but rather a tradeoff decision each potential user will make against the value they derive from using the product or service. People are more willing to put up with facebook’s problematic privacy policies than they would be with a service that didn’t provide vital social connections to friends and family, for example.

FHIR will serve as the basis for healthcare’s interoperable technology future. Pavel Smirnov writes in Healthcare Analytics News about the 7 Facts About FHIR You Need To Know. Required reading for anyone with even a passing interest in healthcare tech. 


Thanks for reading The Healthcare Handout, a weekly update on tech and business in healthcare from Isaac Krasny. You can find him at isaac@healthcarehandout.com, or on twitter @isaackrasny

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