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Posts Tagged ‘policy’

Health 2.0 Wrap-up

Couple of long days and now listening to the wrap-up panel, Looking Ahead – The Business and Society of Health 2.0. One of the panel members, David Lansky, formally of Markle Foundation and now heading up the business healthcare group, Pacific Business Group on Health. Disturbing statement from Lansky was that he worked with Matthew to offer free attendance to the big business leaders in California, many of them from hi-tech, not a single one is in attendance. Lansky went on to say that there are extremely large vested interests in healthcare that are very good at protecting their financial stake and are not going to let go easily. Many will co-op Health 2.0 approaches to keep that control of the purse strings. Lansky encouraged all in attendance that healthcare is a policy issue and that Health 2.0 companies really need to work together and with their customers to force the policy changes needed. Very good and prescient comments.

Panel is for the most part cheerleaders for Health 2.0. Thankfully, Lansky is up there giving some balance – quite pragmatic. Oh, almost forgot, we do have Kolodner from HHS up there on the panel as well. He is encouraging the audience to get involved with AHIC successor. Oh Boy, you are better off siting in your Congressman’s office.

Final Wrap:

Looking at all the solutions I’ve seen here what strikes me most is the need for a roll-up. There is simply no way that a consumer is going to go to one site to manage their records, another to look at potential adverse reactions from meds, another to look at symptoms, a social community to talk about their health and the list goes on.

The WebMD/Healtheon merger leaves WebMD with a sizable war chest of some $340M to go out into the market and act as aggregator/acquirer to create a richer environment for their customers. Spoke to a couple of others who also have access to some very deep pockets who told me they will be out bottom fishing in 6-9 months.

Another strategy is a federated, best-of-breed roll-up where companies with complimentary solutions come together to deliver compelling solutions to institutional clients.

This market and the players within need scale. Virtually all of them are small operations with less than 25 employees. Most that I spoke to are still very much in start-up mode, fleshing out the product and only now begining to think about how they will take the product to market and scale. Channel strategies are immature, messaging non-existent. A lot of promise shown with regards to technology, despite all the overlap, but we are far from seeing this market truly succeed as technology is only a small piece of what it takes to make a business successful.

The event itself is a hell of a lot more interesting and more fun than HIMSS. Hat’s off to the organizers, they have done an excellent job bringing together some excellent people who are pushing the envelop and hopefully with input and engagement from the consumers and physicians they are targeting, these companies will push healthcare in the right direction.

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This morning’s Wall Street Journal has an article, first page – Section B, highlighting the growing impact of the financial crisis on the IT industry. The enterprise software powerhouse, SAP, shocked investors earlier this week when it warned that it would not meet its 3rd Qtr target, citing slowness in the mid-market. Another tech company, RightNow Technologies (provides an SaaS CRM solution) also announced that they are seeing delays on invoice payments. And getting back to the WSJ article, VC firms are having a tough time raising capital and are have begun telling start-ups to batten-down-the-hatches for a long slow period. Some have even gone on to say to their start-ups that if you have a bank credit line, draw it down now as it may not be there tomorrow.

Impact on Healthcare IT (HIT) Spending

Adding to the tight money situation for businesses of all sizes, regardless of market sector, decreasing consumer spending and the increasing burden of healthcare costs shouldered by consumers will directly impact healthcare. Small to mid-size physician practices will be particularly hard hit as consumers forgo visits. This will, in-turn, slow technology adoption for the foreseeable future and result in drastic consolidation among HIT vendors.

And for those of you holding out for one of the presidential candidates to drop a boat-load of money into HIT, don’t hold your breath. During a debate last week at Harvard, two noted healthcare economists each representing one of the candidates (they were both senior advisors to teh candidates) were quite clear in stating that any promises of large investments in HIT will have to wait while other priorities take precedent.

Despite all the doom and gloom, occasionally one sees a glimmer of brightness. IBM this week pre-announced earnings (to quell market concerns) that were positive. And this morning, I received a similar announcement from WebMD, wherein they state that advertising revenue for the third quarter is up substantially, year over year. Like IBM, clearly WebMD wants to get out in front with positive news to quell investor fears rather than wait till their scheduled 3rd Qtr conference call on Oct. 30th.

Quick Assessment:

  • Mid-market HIT vendors targeting physician practices will suffer. Expect consolidation, bankruptcy filings and even shuttered doors. Vendors targeting large practices and hospitals will rely heavily on maintenance and service revenues as customers look to control spend by canceling or delaying large projects.
  • There are far to many integration platform vendors targeting the RHIO/HIE market. Most of these will fail. Those that succeed will have a strong, existing client-base (not heavily reliant on RHIOs) with a clear annuity stream to carry them through what will be a tight market for the next 2-4 years. Those with a clear technological advantage will likely be acquired.
  • The consumer-facing HIT vendors will have little success going directly to the end consumer. Thus, their go to market strategy must migrate to a B2B2C (business>business>consumer) model. In pursuing such a strategy, they must show clear and demonstrable savings to the business sponsor. Creative financing and cost sharing approaches will increase to fund such deployments.
  • Internet-based, consumer-facing health solutions, particularly anyone claiming to be “Health 2.0” company must go beyond the hype and focus on delivering some real value that they can monetize. PatientsLikeMe appears to be on the road to success, far too many others to list do not. A real shake-out will occur here as these start-ups struggle to raise cash.
  • Whether one likes it or not, clearly, there is money in advertising but tapping that source will require a company to show that they have the visitors and are growing in number of impressions. That growth should exceed overall growth in health-related search. WebMD is one clear example, Waterfront Media another and eMarketer lists a few more.

Quick Note:  Just found this article over on CNET that takes  hard look at Web 2.0 companies with the potential to blow-up.  Hmmm, if one were to make a similar one for the Health 2.0 apps sector, who would You put on the list?

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This week, the “Live Free or Die” state of New Hampshire’s House voted down House Bill 1587, a bill that would have strengthened the privacy rights of consumers.

The biggest objections to this bill came from the medical establishment itself claiming that passage of the bill would stall adoption of healthcare IT (HIT) systems. In one of the more bizarre statements Kathleen Bizarro (I’m not making that name up), EVP of the NH Hospital Association stated the bill would “essentially put a halt to the development of electronic medical records.” The medical establishment went on to state that the bill was too onerous, would restrict a physicians ability to provide good care, and that it would exceed existing federal laws (HIPAA).

All of these are pretty empty statements for the following reasons:

  • The bill was designed to simply provide the consumer more control over who gets to see their records. That it not a major burden for providers.  In fact, if a consumer requested an audit trail, the provider/hospital could charge the consumer a fee for providing such a report.
  • Adoption of HIT is not struggling due to privacy/record access issues, nor will it be in the future. HIT is struggling simply because for most physicians, the value proposition is not there.
  • In many states, laws have been passed to strengthen privacy above and beyond HIPAA as HIPAA certainly has its fair share of weaknesses. Unfortunately, most do not know this and hold up HIPAA as the be all to end all for privacy requirements.

Clearly there were other factors at play here as to why these organizations were against the bill. I have not read the bill itself and there may very well be some good reasons to oppose it, but based on the aforementioned arguments that were used, I have the feeling that this was a good bill and that special interests who have a vested interest in keeping firm control of consumers’ health records were at work here.

In a little touch of irony, legislators were granted privacy on this vote as they were able to cast their votes anonymously thereby not showing the public what side of the issue they were on. And it was a close one, defeated 166 to 150. The measure has gone back to committee for revision.

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Today, the World Privacy Forum released a report, Personal Health Records: Why Many PHRs Threaten Privacy. Both the 16 page report and a shorter, 5 page consumer advisory report can be found here. There was also an article today referencing the report in the San Fransisco Chronicle.

While the report does not give names of any particular PHR vendor (I could certainly name a few egregious examples), the report does make it clear that a consumer is at risk of having their privacy compromised if they are not careful.

Research for our upcoming PHR report ( due out by end of May 2008 ) concurs with this finding and it is also something I have brought up in the past. Having over the last few months reviewed countless web-based PHR solutions and where possible, their privacy policies, I have found almost zero consistency. This issue will continue to plague the industry until they, as a group, define what are best privacy and security practices and begin policing themselves through some form of industry-sponsored certification process. (Note: The existing HON certification is a joke.)

Microsoft for example, is in a perfect position to sponsor such an initiative and insure that all partners adopt the same strong privacy and security policies that Microsoft is using for HealthVault. Unfortunately, Microsoft has yet to step-up to the plate on this one, which is shameful.

My Recommendations to the PHR Industry:

Microsoft – Take a leadership role and require that all HealthVault partners adopt the same privacy and security policies that you are using. Better yet, work with Dossia and Google as well to create a common set of standards and compliance policies for the industry and a mechanism to implement them and police them. (Please refer to later post, Microsoft Comes Clean on Privacy, which commends Microsoft for taking a pro-active stance on this issue.)

PHR vendors – Establish a semi-independent organization that will create a set of best practice standards for privacy and security. Give this organization the power to use these standards as the basis of a “Good Housekeeping” seal of approval certification process for PHR vendors. This organization will fully vet PHR solutions going well beyond what HON does today. Those that comply, get a prominent seal to display on their website. Microsoft, Google and Dossia, maybe you could be lead sponsors to form such an organization.

Both of the above will take sometime to implement so what should PHR vendors do today? Here are my top seven suggestions:

  • Make your privacy & security policies clear and understandable.
  • Have them visible and not hidden down at the bottom of your homepage with a small font “Privacy” link.
  • Allow the consumer to download your policies e.g., provide them as a PDF.
  • State clearly how any data may be used.
  • State clearly opt-in/opt-out policies and procedures.
  • Detail how records are stored and where and what are your policies for records removal.
  • Specifically state how you support portability and the process by which a consumer can retrieve their records and move them to another PHR of their choosing.

I’m sure I’ll think of more steps PHR vendors can take later, but taking these steps would be an excellent starting point. Unfortunately, I have yet to find site that supports all of the above suggestions.

If the industry does nothing, they will be leaving it to the government to create privacy regulations. My fear here is that such regulations may not achieve lofty privacy goals and instead have the perverse affect of killing an industry that is only beginning to get some traction.

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One of my favorite sites is the Wall Street Journal’s Healthcare Blog.  You can almost always find any health-related topic that the WSJ publishes in its regular print edition here, which is nice.  But what I like is the ability to comment on specific articles or posts.  And what I like even more, is reading the comments of others which as a general rule are thoughtful and informative.

This week provides a particularly fine example.

On Feb 4th, the WSJ Health Blog had a short post discussing President Bush’s budget proposal and its impact on Medicare and Medicaid spending.  The posting is typical of WSJ’s high quality reporting standards and the comments…

Well, go see for yourself.   You’ll more than likely get quite an education.

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Recently, Massachusetts’ Public Health Council approved the establishment of retail clinics in the state.  While chains such as CVS,  Walgreens and Minute Clinic cheered, others, including the Mayor of Boston howled.

I have a hard time understanding what all the fuss is about.

Retail clinics can provide welcomed relief to overburdened healthcare institutions, such as hospital emergency rooms (ER) departments that are straining under the weight of increasing usage and lengthening wait times, especially in urban areas.  Today’s Wall Street Journal ran a brief article highlighting a study which will be published today in the journal Health Affairs (full research paper here).

The researchers found ER wait times increasing 36% in a seven year time span (1997-2004) for general ER visits and wait times up 150% for heart-attack patients.  This is something that all health industry stakeholders and politicians should be concerned about and need to keep an open-mind as to possible solutions for the problem will only get worse in the foreseeable future.

Luckily, many here in the Commonwealth, including CEO Paul Levy who overseas one of the largest hospitals in Boston, are much more open-minded than Mayor Menino.  Levy, who is not a doctor but an excellent and thoughtful administrator took the AMA to task over this issue last year in one of his more controversial posts.  One can only hope that the Mayor will come to his senses and allow these clinics within Boston for as the aforementioned research report in Health Affairs found, ER wait times are the worst in the Northeast and worse yet in urban areas.

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eRx Taking Off

Last week, the big eRx (electronic prescription) clearing house, Sure Scripts, released a comprehensive report on the growth of eRx. Astounding numbers presented, as well as some nice graphics/metrics for anyone who is putting together a presentation on the subject

Based on their research, which goes back to 2004, Sure Scripts has seen eRx more than triple in the first 3 quarters of 2007 compared to the the previous 3 years (2004, 2005, 2006) combined. Despite that kind of growth, the report claims that eRx still only represents some 5% of all prescriptions filled.

Could we see another tripling, or more in 2008? Potential is certainly there with a new legislative push in Washington requiring eRx for Medicare.

While many will state that eRx will help improve outcomes by lowering medication errors, the evidence is simply not there. What eRx is really about is saving money and such savings come from the transactions such as:

  • Simplified routing of prescriptions to both pharmacy and payer for processing.
  • Significant reduction in time for providers to determine patient eligibility.
  • And an oft-stated comment that it makes it easier to prescribe appropriate generics as substitutes.

Despite these advantages, eRx is still new and continues to suffer growth pains. The solutions available today still require a fair level of effort to implement and support within a provider’s healthcare IT (HIT) platform, not all pharmacies are set-up to support eRx and there is always the challenge, as with any IT solution of seamless integration into an existing practice’s workflow.

But these issues are not big enough to slow adoption, especially when the biggest spender on prescriptions, Uncle Sam who is footing the bill on Medicare, starts telling providers their reimbursements will be cut if they don’t adopt eRx by 2011.

Addendum:

For all those providers looking for examples of Best Practices, well you may want to start in the fine state of Massachusetts, which according to the Sure Scripts report, ranked #1.  So in addition to the Red Sox, the Patriots, the Revolution and the Celtics, we have one more thing to be proud of! 

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