February 16, 2023

ARTIFICIAL INTELLIGENCE

• The U.S. General Services Administration (GSA) launched the Applied AI Healthcare Challenge, a competition that encourages companies to develop AI-based tools to improve health outcomes in several areas, like mental health and opioid addiction.
• A W.H.O. report detailed the benefits and challenges of using AI in mental healthcare, highlighting the potential issues AI might pose.
• Digital healthcare platform Doximity launched a beta version of a ChatGPT tool to streamline workflows and address physician burnout. There are so many additional articles this week on how ChatGPT is able to assist with health care challenges, we list them here, here, here, here, here.

ARTIFICIAL INTELLIGENCE INVESTMENTS

• A number of health systems, including Mayo Clinic and MGH, received a $23.5M grant to incorporate AI into intensive care units (ICUs).
• GE HealthCare will acquire Caption Health to improve precision care and technological diagnostic tools, the company’s second tech-based acquisition.

DIGITAL HEALTH INVESTMENTS

• After unveiling its in-network virtual platform for mental health treatment in children, New Jersey-based Fort Health finalized a $4.5M funding round to expand its market.
• Marker Learning raised $15M in Series A funding to support its quality learning disability assessments and treatment platform.
• Faro Health, a cloud-computing solution for smart clinical trials, secured $20M in an additional funding round.

FEDERAL NEWS

• On February 13, HHS and ONC recognized the inaugural cohort of Qualified Health Information Networks (QHIN) within the Trusted Exchange Framework and Common Agreement (TEFCA) as the companies work together to create a new standard of interoperability. More here.
  • ONC granted Epic approval to join the health information exchange framework that includes CommonWell Health Alliance, eHealth Exchange, Health Gorilla, Kno2 and KONZA National Network.
• ONC announced the news that more than 95% of health IT developers met the compliance deadline to provide customers with FHIR-based APIs as part of the ONC Cures Act Final Rule.

INDUSTRY NEWS

• The Connectivity Standards Alliance (CSA), a group of 600 organizations including Apple, Google, Amazon, Samsung, and Verizon, announced that it is building standards and certification program for health and wellness technology. CSA will support aging-in-place and independent living by utilizing data generated from connected smart home devices and later expand to other home health and wellness devices and use cases, like remote patient monitoring, chronic condition management, and acute care in the home.
• For the thirteenth consecutive year, KLAS Research named Epic as the top Overall Software Suite in its annual Best in KLAS report.
• The AMA Future of Health report urged hospitals and health systems to implement simple, patient- and physician-centric technology platforms and care models to realize the full potential of digital health. Kaiser Permanente, Mayo Clinic, and One Medical are cited as examples of companies that prioritize effective digital health integration.
• Orion Health secured HITRUST and DirectTrust security accreditation for its population health and precision medicine platform, Amadeus.
• UnitedHealthcare announced a wellness-focused rewards program that allows beneficiaries to earn credits through physical activity and healthy sleep patterns. Members could earn up to $1,000 per year by completing wellness tasks logged through wearable devices.

DATA PRIVACY AND SECURITY

• A Duke study found that data brokers are taking advantage of telehealth and therapy apps to collect and sell Americans’ mental health data. Duke researcher Joanne Kim called for a more comprehensive national privacy law, or at least an expansion of federal rules governing healthdata to include consumer information to guard against misuse by brokers.
• HHS’ Health Sector Cybersecurity Coordination Center (HC3) released aguide to help health care organizations protect their internet-connected devices and networks from Distributed Denial of Service attacks, which make their network unusable by flooding it with traffic.
• HHS, FBI, and CISA issued a joint cybersecurity advisory with the government of South Korea warning healthcare organizations of North Korean state-sponsored threats.
• As detailed in a Wall Street Journal article, medical device manufacturers face increasing pressure to protect their products from cybersecurity attacks as the healthcare industry faces data privacy breaches and new FDA minimum cybersecurity standards for devices.

DRUG PRICING

• For the new Medicare Prescription Drug Inflation Rebate Program, CMS released initial guidance to implement that part of the Inflation Reduction Act, which requires rebates to the Medicare Trust Fund if drug prices exceed inflation. This is an excellent summary by Hogan Lovells; more here, here, here, and here.
• The CMS Innovation Center (CMMI) launched three new payment models (for Medicare Part B, Part D, and Medicaid) designed to lower drug costs. Fact sheet here; FAQs here. See more here, here.
• According to analysis published in JAMA, employer-sponsored plans pay up to 30 times more than Medicare does for physician-administered drugs.
• Texas Tech professor and former Congressman Jason Altmire wrote an op-ed in The Hill to defend PBMs prior to a Senate hearing this week.

HEALTHCARE TRANSPARENCY

• CMS officials wrote a blog post published in Health Affairs, noting that at least 30% of hospitals are not complying with price transparency regulations that have been in place for two years. CMS is exploring how to streamline enforcement efforts.
  • A Kaiser Family Foundation analysis detailed some of the challenges with hospital price transparency, including the ‘confusing’ nature of reporting platforms.
• Following the Texas court’s ruling that the dispute resolution process under the No Surprises Act unfairly favors insurers, CMS announced that it is putting the process on hold while it works to evaluate and update it. More here.
• CMS released initial guidance for the new Medicare Prescription Drug Inflation Rebate Program to implement a part of the Inflation Reduction Act, which requires rebates to the Medicare Trust Fund if drug prices exceed inflation. More here, here, and here.

PAYERS

• CMS responded to concerns Medicare Advantage and Part D payments will be increased by as much as 2.27% according to the recent CY 2024 Advance Notice, claiming its internal estimates remain at a 1.03% increase.
  • In its comment letter, AHIP told CMS it has serious concerns about the impact of the 2024 Advanced Rate Notice and proposed changes to the Star Ratings program. AHIP claims that policy changes could reduce benefits and increase premiums without improving quality.
  • In a joint comment letter, 119 physician societies — led by the AMA — encouraged CMS to improve the coverage criteria used by Medicare Advantage health plans for medical necessity determinations. Doctors are particularly concerned about the heavy paperwork burden and that plans are using prior auth processes to delay care. The groups also said that plans should “gold card” doctors with high prior auth approval rates, allowing them to skip the prior auth process altogether.
• The CMS Innovation Center (CMMI) launched three new payment models (for Medicare Part B, Part D, and Medicaid) designed to lower drug costs. Fact sheet here, FAQs here.
• The Better Medicare Alliance commissioned Avalere Health to report on how the proposed MA payment cuts will mean a decrease in per enrollee spending.
• A Health Affairs study found that MA enrollment grew by 337% between 2006 and 2022, while traditional Medicare enrollment dropped by 2.9% during that same period.
  • Experts suggested setting MA prices through a competitive bidding process, rather than using traditional Medicare benchmarks, to accommodate this growth.
• Senator Wyden, Senate Finance Committee chair, is urging CMS to finalize a proposed rule that would prohibit deceptive marketing practices by Medicare Advantage plans, including having “ghost provider networks.” More here.
  • The American Journal of Managed Care reported on a study of California provider directories, which found that mental health provider directories are highly inaccurate.
• The U.S. Department of Justice collected about $2B in False Claim Act settlements in 2022 Medicaid fraud. MA overpayments and illegal kickbacks accounted for about $1.7B.
• A report from the U.S. Consumer Financial Protection Bureau found that the number of people with medical debt on their credit reports decreased by 17.9% between 2020 and 2022.
• According to an analysis published in JAMA, employer-sponsored plans pay up to 30 times more than Medicare does for physician-administered drugs.
• According to an analysis by the Employee Benefits Research Institute, individuals with Medicare Advantage generally require fewer retirement savings to cover healthcare costs compared to individuals with traditional Medicare.
• Centene paid Medi-Cal a $215M settlement for allegedly attempting to overcharge Medicaid programs for prescription drugs.
• A Fierce Healthcare report analyzed 2022 payer profits and revenue and found that UnitedHealthcare accrued the highest profit margin.
• To address health professional workforce issues, Aetna will fund a clinical mental health counseling master’s program at West Virginia Wesleyan College.
• ChenMed and Humana continued their senior-focused partnership and agreed to a five-year deal to provide Humana MA enrollees with ChenMed’s primary care resources.
• Oscar Health partnered with Associated Medical Care to support its +Oscar Campaign Builder tool, which would ease providers’ administrative burdens and streamline workflows.

PAYERS AND PROVIDERS (M&A)

• Christine Wilson – the sole Republican commissioner on the FTC – announcedher resignation as FTC Commissioner. In a Wall Street Journal op-ed, Wilson detailed her reasons for leaving, including her dissatisfaction with FTC chairman Lina Khan.
• Sanford Health and Fairview Health Services announced a two-month delay in their merger following a request from the Minnesota Attorney General to postpone it.
• CommonSpirit Health and AdventHealth are dissolving their longtime Centura Health joint venture — one of Colorado’s largest hospital networks. CommonSpirit will take control of most of the 20 hospitals.
• In Q2, CVS will issue bonds for ‘general corporate purposes’ to fund its anticipated $8B acquisition of Signify Health, a home health company.

PROVIDERS

• CMS released a proposed rule that would require nursing homes to disclose details on their ownership and management by real estate investment trusts or private equity firms.
• The AMA, alongside 118 other physician organizations, wrote a letter to CMS in support of reforms to the prior authorization process for medical treatments.
• According to a surveyby the American College of Healthcare Executives, workforce shortages ranked as the #1 worry of hospital CEOs, particularly a shortage of RNs.
• An AHA report recommended that hospitals partner with Big Tech companies like Amazon and CVS and prioritize convenience, access, and virtual care.
  • According to the report, disrupters are estimated to control 30% of the primary care market by 2030.
• The AHA reported that CVS Health’s acquisition of  Oak Street Health raised antitrust issues, noting that groups like the American Economic Liberties Project have started to complain that the deal will impede competition and ultimately hurt consumers.
• A JAMA study found that health system profitability and wealth depend on the ability of these health systems to negotiate prices with commercial payers.
• Senator Tammy Baldwin questioned Ascension, one of the largest non-profit health systems, about whether its investments are being directed to improve patient care. Senator Baldwin’s letter
• Kaiser Permanente reported a $4.5B net loss in 2022, which they attributed to severe staff shortages, increased medical expenses, and investment losses.
• Tenet, a for-profit hospital chain, expects to grow its revenue in 2023 due to limited labor costs and the expansion of its surgery centers.
• Henry Ford Health, Michigan State University, and the Detroit Pistons owner, Tom Gores, are planning to invest $2.5B in new health facilities across Detroit, including a joint medical research center, and numerous hospital expansions.
• The Chartis Group predicted an increase in rural hospital closures in 2023 as pandemic relief funds dwindle. According to their report, nearly 51% of rural hospitals have a negative operating margin, and many facilities have been eliminating services.

VALUE-BASED CARE

• Analysts and industry leaders outlined challenges CVS may face after its recent primary care acquisitions – like Oak Street Health – emphasizing that value-based care requires human capital from an already-strained primary care workforce.
• Signify Health announced plans to join the CMS Advance Investment Payments (AIP) incentive program to support providers in rural and underserved communities through advanced funding for infrastructure and resources.
• ACO Pathways Health Partners partnered with PointClickCare to launch its value-based care platform, which utilizes live patient data updates to ease communication with providers and hasten care access.

HEALTH EQUITY & SDOH

• According to a Health Affairs study, ambulance transport destinations differ for White and non-White patients, thereby potentially fueling health disparities.
• Novant Health received $1.5M from the Golden LEAF Foundation to expand its medical residency program in rural North Carolina and improve rural healthcare outcomes and reduce disparities.
• A Health Affairs article argued that opioid lawsuit settlement funds should be redirected to substance use treatment for incarcerated individuals to promote equitable rehabilitation outcomes.
• The Humana Foundation announced efforts to improve food insecurity and support vulnerable populations like seniors, children, and veterans through three major initiatives.

MEDICAID

• The CMS Innovation Center (CMMI) announced three new models to lower drug costs, including permission for state Medicaid agencies to pay for cell and gene therapies by delegating authority to CMS to create multi-state arrangements with manufacturers.

• The Biden Administration will allow some states to direct Medicaid funds to certain food programs as a part of its “food is medicine” approach.
• The Kaiser Family Foundation collaborated with the Association for Community Affiliated Plans (ACAP) to conduct a survey of Medicaid MCOs to determine how they plan to help with the unwinding of the continuous enrollment as part of post-PHE changes. More here.
  • Managed Healthcare Executive interviewed ACAP’s long-time CEO, Meg Murray
• North Carolina General Assembly Republicans introduced a new Medicaid expansion bill, House Bill 76: Access to Healthcare Options, that would expand Medicaid coverage to 600,000 individuals.
• An analysis published by the Kaiser Family Foundation acknowledged the importance of Medicaid managed care organizations (MCOs) for delivering care and mitigating the effects of unwinding when the PHE ends.

FEDERAL NEWS

• In an interview with Politico, Representative David Schweikert, co-chair of the Telehealth Caucus and chair of the Ways and Means Oversight Subcommittee, discussed the future of virtual care, including the potential of technology to cut costs and streamline care.
• The American Academy of Family Physicians (AAFP) sent two letters to Congress in response to a request for feedback on the Creating Opportunities Now for Necessary and effective Care Technologies for Health Act. In their letters, they urged Congress to simplify payment processes and address telebehavioral health issues.

NEW LAUNCHES AND PARTNERSHIPS

• Included Health and Solv partnered to integrate virtual and in-person care, to help patients coordinate both virtual and in-person, and to provide same-day appointments using a singular, consumer-friendly platform.
• Penn Medicine invested in digital health startup Twentyeight Health to offer virtual reproductive health services that will expand access to reproductive care.
• Lifepoint Health collaborated with Midi Health, a digital women’s health company, to offer virtual care support for women experiencing menopause and perimenopause.
• Samsung Galaxy Watch5 partnered with Natural Cycles to develop an FDA-registered algorithm consumers use to track their menstrual cycle and fertility status using temperature-based technology.

OTHER TELEHEALTH NEWS

• A study published in the American Journal of Obstetrics and Gynecology Maternal-Fetal Medicine found that telehealth may help reduce disparities in postpartum care.
• In an interview, the Chief Healthcare Executive and CEO of TimelyMD, a telehealth company focused on providing mental health services to college students, discussed the growing demand for virtual services in the higher education market.
• A UC Davis study found that telemedicine may allow providers to better coordinate care for critically ill pediatric patients at rural and community emergency departments.