Cleveland Clinic & HealthVault Unite

In an interesting twist, Cleveland Clinic and Microsoft’s HealthVault Grp announced a partnership this morning to address chronic disease management. The interesting twist is that Cleveland Clinic was the showcase beta customer for Google Health, which was announced by Google’s CEO Eric Schmidt earlier this year at HIMSS. Like their counterpart in Boston, Beth Israel Deaconess Medical Center, who was part of the initial Google Health public roll-out in May and who has since also established a link to HealthVault for their PatientSite users, Cleveland Clinic is taking an agnostic approach to the major platform plays with this agreement.

The Cleveland Clinic-HealthVault announcement is distinctive in that it focuses on chronic disease management, via telehealth, through use of HealthVault’s unique Connection Center. With some 50 devices from 9 vendors, the Connection Center allows the consumer to upload device data (e.g., glucose readings, heart rate, blood pressure, weight, peak flow, etc.) directly to their HealthVault account. In the Cleveland Clinic project, which began last week (Nov. 3rd), uploaded biometric data from HealthVault compliant devices will automatically be pushed to Cleveland Clinic’s EMR and subsequently exposed to the physician for patient tracking and follow-up.

Had a call this morning with Microsoft and one this afternoon with Cleveland Clinic who both shared further details on this announcement:

A target of 460 Cleveland Clinic patients will participate representing three distinct disease categories; hypertension, diabetes and heart failure. The roll-out is across the Cleveland Clinic Integrated Delivery Network (IDN) and not just hospital patients. Clearly, they are focusing on the big chronic disease categories that result in huge costs that many believe better telehealth monitoring can mitigate.

• Hypertension patients, of which there are 400, will measure blood pressure only.
• Diabetes patients, of which there will be 30, will use five devices to measure glucose, blood pressure, peakflow, pedometer and weight.
• Heart Failure patients, the remaining 30, will use four devices to measure blood pressure, peakflow, pedometer and weight.

Pilot will initially be for an extremely short 90 days. Cleveland Clinic expects to have all patients active within 4-6 weeks. Not sure what they can accomplish in 90 days, maybe Cleveland is just hedging their bets to see if patients actually comply with the prescribed measurement and upload regime. Assuming that all goes well, one can guarantee that this pilot will be extended for at least a year, if not longer, as that is the only way they will be able to provide some demonstrable results that are publishable (something that Microsoft emphasized) and ultimately may influence future legislation (e.g., CMS funding), health plan reimbursement (P4P), and broader adoption among other Integrated Delivery Networks (IDNs).

Devices are being provided for free to trial participants. The only requirement, beyond the obvious willingness to diligently take their measurements, is that they have a Windows-based (XP SP2) computer and broadband access. Unfortunately, many heart disease patients are among the elderly and it is questionable as to how many have this capability. Still, the point here is to demonstrate, not solve all the problems and it is a good start.

Cleveland Clinic is training patients on the use of the devices(s), and data upload process to HealthVault, that is subsequently pushed to Cleveland Clinic’s EMR. Part of that training includes clearly notifying the patient when a particular reading should prompt a call to their doctor or even 911. Along with providing the device(s) and training, the physician will prescribe to the patient their measurement protocol (e.g., 2x/day, 3x/week, etc.) unique to that individual and the condition they are managing. Patients trust their doctors so receiving the package directly from their physician during an office visit makes a lot of sense and should encourage use and hopefully compliance. It will be interesting to see how compliant patients are to the prescribed compliance regiment as this is often a critical stumbling block. Will incentives be required?

Cleveland Clinic put in the upfront effort to understand how best to incorporate this new data stream into a physician’s workflow to minimize the burden. Specifically, the physician will receive a weekly notice notifying them that their patient(s) biometric data is ready for review. One click later and the physician is in the EMR reviewing their patient’s data for that past week. Prior to this pilot, Cleveland has experimented with other telehealth systems, but none were able to provide this level of integration with the core EMR system (always a stand-alone, silo’d operation) and thus saw little adoption among physicians. This is absolutely critical! Having spoken to many physicians about the success, and most often failure of telehealth initiatives, it nearly always circles back to lack of true integration to existing practices/workflow. Looks like this pilot tackles that issue head-on.

So what is the Business Case?

Wrapped up my conversation with Cleveland Clinic’s CIO, Dr. Martin Harris, (thanks again Martin for your time) by asking him: So what is the business case for this initiative? He outlined two areas where they see a benefit to Cleveland Clinic:

Service Case: In moving to this model of combining telehealth with traditional in-office visits they intend to completely re-design the office visit resulting in a better, more engaged and customer friendly process. This process will lead to higher customer service ratings, customer recruitment and higher customer retention – all important top-line metrics. They also see a service case for the physician as such a “system” will allow the physician to deliver a higher level of proactive care with their patients. Its all about market differentiation, distinguishing themselves in an increasingly crowded market – one that will only get more competitive.

Outcomes Case: One of the objectives of the pilot is to see if Cleveland Clinic can consistently improve the outcomes/health of its chronic care patients that will result in fewer hospital readmissions and/or complications. If all goes as planned, Cleveland Clinic believes that it will be able to use these positive results to request better reimbursement schedules (more income) from health plans. This certainly makes logical sense, but to date, health plans and CMS have been reluctant to support such programs – more of a wait and see approach. Hopefully, Cleveland Clinic will start showing some impressive results in a year or so and get those health plans on-board.

Final Note:

A couple of weeks ago I poked Microsoft about their lack of support for the telehealth consortium, the Continua Alliance. Sean Nolan responded stating a primary reason was Microsoft’s desire to move quickly (consortia always seem to move at a snail’s pace). Looks like that has paid-off as Google Health and Dossia cannot, today, support such capabilities as demonstrated above, though they are on the path having joined the Continua Alliance and Google demonstrated modest capabilities at the recent Connected for Health Symposium.

Looking ahead, we forecast 2009 to be a year of pilots which begin to demonstrate the utility of the platform model (Dossia, Google Health, & HealthVault) in support of telehealth and how telehealth technology and practices are best integrated into existing clinician workflow. Look to 2010 to see actual reimbursement models and P4P programs begin to take shape in support of promotion and adoption of telehealth.

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AT&T, Microsoft and Covisnt Partner on Data Exchange

This just in, Microsoft’s HealthVault announced a partnership with AT&T and Covisint to enable healthcare data exchange across a highly distributed network.  While I have not had a chance to really dig into this announcement, it does appear, at least on the surface, to be quite an interesting partnership.

One of the most interesting aspects to this announcement is Covisint.  For those who may not remember the  dot-com hey-days of the late nineties, Covisint  was originally formed by the Big Three automakers with the purpose of creating a common architecture for e-Procurement and other supply chain enhancing functions.  Covisint never really did take-off, despite massive spending by the Big Three and Tier One suppliers.  Big problem came up when the automakers discovered that many of their pricing, contracts, and materials information were actually very proprietary and thus not suited for Covisint.  That left Covisint with commodity type products to attend to and there were simply not enough at sufficient margins to sustain the model.

Maybe their venture into healthcare will be more promising.  Covisint certainly has the secure data exchange angle well-covered.  Look to the AT&T/Covisint deal in Tennessee to understand more of where this may be going.

Will look into it further and possibly do a more in-depth report if warranted.  For

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Telehealth in US has Long Way to Go

Philips finally released its long awaited study on the adoption of telehealth technologies among the nation’s some 976 home healthcare agencies. Initial results of his study were released last fall at the Connected for Health conference and I have been patiently waiting ever since to see the final report.

So to give you a preview here’s what you will find:

A long report, all 117 pages of it, with a lot of data that really seems nonsensical. Luckily, it is formated in such a way that one can readily skim through it and pull out tidbits of interest.

The tidbits I found particularly interesting were:

• Only 17% of home healthcare providers are using any type of telehealth monitoring. Big hurdles to adoption are the like the four horsemen of the apocalypse – quite obvious – Cost, Cultural, Workflow/Integration and Education.
• Single most important strategy to get clinical staff buy-in to adopt telehealth was to promote telehealth’s ability to improve quality of healthcare delivered.
• Reducing costs was not the primary objective for adopting telehealth. In fact, 48% reported that it did not reduce costs, versus 42% who did see some cost reductions.
• Over 70% of agencies using telehealth saw a marked increase in customer satisfaction levels. For those for-profit agencies, customer satisfaction was even higher at over 81%.

Some Final Comments:

Maybe agencies looking to adopt telehealth technologies as part of their service offerings need to rethink their strategy and not be so focused on the bottom-line of what telehealth can do for them, but what telehealth can do for their customers. Same can be said for the vendors of telehealth technologies.

There have been plenty of reports and proof points on the economic value of telehealth, for example its ability to reduce re-admittance rates. Yet, when vendors of telehealth look to sell their technology to the other 83% of agencies that still do not use telehealth in their practice, these vendors would be wise to consider this report’s findings and restructure their go to market strategy focusing on how their technology contributes to customer satisfaction, future referrals and top-line growth rather than the bottom-line savings message that is so prevalent today.

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Enough About the Gorillas, How About a Lemur

Plenty has been written, both here and elsewhere about the two 800-pound gorillas, Google and Microsoft’s, respective plays in the consumer healthcare sector. Yes, what they are doing is extremely important to this industry and will change the healthcare industry in ways we have yet to imagine, but let’s giving this story some breathing room, at least for today and focus on a lemur instead.

A tiny Canadian company, TinyEye is doing something right now to address a problem that plagues many a youngster, speech impediments. My own younger brother suffered from this as a child and had a couple years of tutoring to overcome his speech impediment. Luckily, my parents could readily afford a tutor and we always lived in relatively dense, suburban communities so it was not that hard for my brother to meet with a speech pathologist once a week.

But what about those children who live in rural communities? Well, that is where TinyEye comes in.

The founder, Marnee Brick, is a speech pathologist and was struggling to visit all her clients spending more time in the car, than with a patient. Three years ago, she brought the topic up with her brother, Greg Sutton, who suggested using the Internet to deliver services and TinyEye was born. The two built out a telehealth solution that would allow a speech pathologist to deliver services via the web, using simple, speech-centric computer-games coupled with an Internet videocam that allows the speech pathologist to work with the child online and remotely to observe in real-time a child’s pronunciation and make corrections. Really, pretty slick little solution that addresses a real market need and gives one some idea as to how telehealth can be applied to some seemingly mundane, but important problems.

TinyEye is a hosted SaaS (software as a service) solution that includes some 40+ games that a speech pathologist can easily configure to their patient’s needs based on a wide variety of articulations. The patient is provided access to the online games by their speech pathologist for doing “homework” between virtual (and real) visits. As these games are hosted online, the pathologist can also go back and see how a patient is progressing in doing their homework assignments.

The product went beta in November 2006 and had their first paying customer by March 2007. TinyEye is methodically growing out its business, which is surprisingly international for such a young start-up having clients in Canada, the US, Mexico and even Argentina. Typical customer today is a school district that covers a large geographical area and provides speech training to students in elementary grades. By adopting the solution, the school district typically cuts trip visits by speech pathologists neaarly 75%, with the pathologist visiting schools once a month rather than the prior once per week schedule to give instruction. As a subscription service, pricing is flexible depending on modules used, number of pathologists, etc. What the company has found most successful though is to price the solution based on a traditional ROI model, which is this case is time and resource (most often travel costs) cost savings for the school district.

Final Assessment

Nice, simple example of what a small company can do leveraging new technology platforms and business models to address a very real need in the market. TinyEye is certainly not out to solve all the ills in healthcare today, nor could they, but their focused approach on a well-defined niche is solving a clear problem. TinyEye is not big, its not fancy (marketing could use some help here) but it works and it is delivering value today to pathologists, patients and funding agencies.

I love finding companies like this.

As an analyst one can easily get drowned in the hype of what the Big Boys are doing. It is refreshing at times to find simple companies like TinyEye. What was even more surprising for me, is that in a relatively simple search and review, I could not find anyone else doing what TinyEye is doing – they do seem to be unique.

Again, a breath of fresh air after all the other hype including HIMSS. Three cheers to all the small lemurs in the market addressing healthcare issues one problem at a time.

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Predictions 2008: Telehealth Jumps, RHIOs Fade, Legislation Stalls & PHRs Get the Press

A common practice in the analyst community is to take a look back at what has occurred and project forward as to what we might see in the coming year. I won’t spend anytime on what has occurred as you can always drift back to previous posts.

Following are the Top Ten predictions for 2008. Note, these predictions are primarily focused on our core research competency – Personal Healthcare Technology. And if these top ten differ from yours, by all means give us a comment providing your list.

1.) Election Year Puts Many Initiatives in Neutral
2.) Telehealth Continues to Gain Momentum Driving Consolidation
3.) Consumer Electronic Manufacturers Jump on Telehealth Bandwagon
4.) Legacy HIT Vendors Copycat AthenaHealth with Their Own SaaS Offerings
5.) PHRs Still in Headlines, While Adoption Stumbles Along
6.) Attention Turns to PHSs, but Vision Remains Well Ahead of Reality
7.) PDF – Healthcare Hits the Streets, Retail Clinics Love it, Physicians Less So
8.) Personal Identifier Initiatives on the Hill are DOA in ‘08
9.) Employers Expand High Deductible Plan Offerings, Consumers Challenged
10.) HIEs Hold Steady, RHIOs Fade Away – Major Re-thinking of NHIN

Election Year Puts Many Initiatives in Neutral
As the Bush administration continues to see high-ranking officials leave office, no new healthcare-centric initiatives are launched and those, such as the ill-fated National Health Information Network (NHIN), are put on life-support. Even pay for performance (P4P) activities are pulled back until a new administration is in place (mid 2009).

Telehealth Continues to Gain Momentum Driving Consolidation
2007 saw several reports touting the efficacy of telehealth practices, from interacting with a physician over the Internet to the migration of outpatient care and monitoring to the home via health sensor networks and the Web. This will be one of the strongest areas of growth in healthcare technology in 2008 with annual percentage rate growth in the mid-teens. Growth will drive consolidation, as large established players such as Philips, GE and Siemens acquire smaller device manufacturers with either unique technology platforms or specific vertical market presence.

Consumer Electronic Manufacturers Jump on Telehealth Bandwagon
The growth in telehealth and simple demographics (this market will only get bigger) will attract other electronic manufacturers with strong Brand and established consumer distribution channels. Think Sony, Toshiba, LG. Still too early for Nokia and Apple, but they are coming. These companies will also look to acquire, or partner with established players in the personal health technology market to gain domain knowledge and market presence. The upcoming CES confab in Las Vegas may shed some light on who will make the first move.

Legacy HIT Vendors Copycat AthenaHealth with Their Own SaaS Offerings
The success of AthenaHealth in the market and on Wall Street (10th best performing IPO in 2007) is certainly not lost on the traditional Healthcare IT (HIT) vendors. Like the software firms in the enterprise market who have all tried to replicate Salesforce.com with their own SaaS CRM solution, expect the legacy HIT vendors to do the same in their attempts to replicate AthenaHealth. Expect the same lack of success. To date, none of the traditional enterprise software vendors have been able to catch Salesforce.com, which still shows remarkable momentum in the market.

PHRs Still in Headlines, While Adoption Stumbles Along
With the impending release of Google Health in the first half of 2008, we will continue to see a lot of press dedicated to Personal Health Records (PHRs). Despite the press and employers who continue to adopt these solutions for their employees to foster better healthcare practices, there remain many significant challenges that will prevent the PHR market from really breaking out. Expect 2008 to be a build-out year for PHR vendors, thus tracking large customer wins, partnerships and alliances of these vendors will be critical to assess long-term viablity.

Attention Turns to PHSs, but Vision Remains Well Ahead of Reality
Microsoft has HealthVault, employers have Dossia and Google will have Google Health (or some other Brand name) by mid-2008. All of these are Personal Health Systems (PHSs). They are not a PHR, but a data repository and ultimately a utility that other applications, including PHRs can tap to serve the consumer. Each of these PHSs have enormous resources behind them, but their vision is far ahead of what they will be able to deliver in 2008. There is a lot of heavy lifting (standards, tagging, document management, security, etc.) that these entities will need to address, consuming most of 2008. Look to mid-2009 for these systems to be at a level of functionality that is useful to the broad market.

PDF-Healthcare Hits the Streets, Retail Clinics Love it, Physicians Less So
The “Best Practices Guide” for the use of PDF-Healthcare is making its way through the formal review process with expected release in the next month or so. Currently being used by one of the largest retail clinics, PDF-Healthcare has demonstrated its utility for this retail clinic that is now exchanging over 10,000 unique PDF-Healthcare documents a day throughout its organization.

While this retail clinic has reaped a number of advantages through the use of PDF-Healthcare, and larger healthcare providers will do so as well, smaller physician practices will be challenged by this format as most are ill equipped to accept such digital documentation. Thus, PDF-Healthcare will become another forcing function for physician adoption of EMR, something that most have been loathed to do.

Personal Identifier Initiatives on the Hill are DOA in ‘08
Several proposals surfaced in 2007 calling for the establishment of a personal identifier for American citizens to better track/tag their medical records. This is becoming increasingly relevant as use of digital records accelerates. Despite a very real need for personal identifiers, this issue exacerbates existing fears of privacy and government intrusion. Thus, this will not see the legislative light of day in 2008. A new administration may take it up in 2009 if they receive a strong mandate from the public (i.e., a landslide victory).

Employers Expand High Deductible Plan Offerings, Consumers Challenged
Building upon the growing trend we saw in 2007 of employers seeking new ways to lower their exposure to double digit growth in medical benefit costs, consumer-driven health plans, most often with high deductibles, are now in vogue. Young, healthy employees sign-on to such plans, chronic care sufferers reject them and middle-age employees with families struggle to determine what is best for them. Unfortunately, for this latter group few resources are available to assist them with making the best choice. And as for those young, healthy and very often Internet-savvy employees, they look to the Web to help them pick a doctor and control expenses. But they to will come up empty handed as cost transparency will remain elusive in 2008.

HIEs Hold Steady, RHIOs Fade Away – Major Re-thinking of NHIN
The reports released at the end of 2007, the first on the relatively dismal state of Regional Health Information Organizations (RHIOs) and the second on the modest success of Health Information Exchanges (HIEs) were simply a harbinger for 2008. Expect 2008 to deliver more of the same for RHIOs as they continue to struggle to establish a value proposition that will overcome competing entities participation in a RHIO. And there is the nagging issue of a revenue model for RHIOs to make them self-sustaining long-term – to date, this issue has not been solved. Both of these problems will lead to nearly a third of the remaining RHIOs closing their doors by the end of 2008 and another third will be best characterized as the walking dead.

While RHIOs fade, HIEs will continue to operate and see modest growth. Unlike RHIOs, HIEs are formed by entities that have a strong desire to share information, not withhold it. But HIEs will not be the panacea to the need for a NHIN as their reach will be limited and highly localized. This will limit the overall growth of HIEs and subsequently, their impact to the market.

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Philips Continues Buying Spree

Philips Electronics announced on Friday that it will acquire Respironics for $66/share or about $5.13 billion, a 24% premium.   This is the third and largest healthcare-centric acquisition that Philips has made in December.  The first was Emergin, a small company (~100 employees, estimated $18 million in 2007 sales) and provider of medical alarming systems for hospitals.  The second, Visicua a supplier of systems for remote monitoring of intensive care units, was acquired for $430 million.

All three acquisitions are the manifestation of Philips’ “Vision 2010” strategy, which was announced in early September. As part of this new vision for the company, divisions have been realigned into three distinct groups, lighting, consumer lifestyle and healthcare with planned investments to build these three into market leading organizations.

Within healthcare, Philips combined its separate Medical and Consumer Health divisions into one entity. While the first two acquisitions are in support of the former Medical group, the Respironics acquisition will provide solutions that span both the hospital/provider market and the home healthcare market.

The acquisition of Respironics, while appearing expensive at first blush, is a brilliant move and will, if executed properly, reap significant benefits for Philips for a number of reasons including:

• Fills a gap in Philips current product portfolio allowing them to deliver to market a more complete solution suite.
• Respironics is on a tear, with revenue growth in the mid-teens and margin growth of nearly 20% that shows no signs of slowing. They also appear to be a very well managed company and Philips has publicly (and wisely) stated they foresee no layoffs as a result of this acquisition.
• Respironics, a US-based company has only recently made significant in-roads in overseas expansion, which represents roughly 31% of sales in FY06. Philips, with its broad international distribution network, could see some quick gains by broadening Respironics international presence.

Philips is positioning itself well for the inevitable move to deliver far more healthcare services, via telehealth, within the home rather than at a hospital or physician practice.  One of the nation’s largest, integrated healthcare providers, Kaiser-Permanente, for example is exploring new ways to deliver healthcare at the home to minimize the need for building more facilities.  Several studies have also been recently released that clearly demonstrate the efficacy of telehealth.

With the minor exception of the partnership between GE and Boston Scientific, Philips’ major competitors Siemens and GE have been relatively silent, leaving one to wonder if they lack the vision or have simply chosen to head down a different path.  My guess is that they are watching Philips’ moves with a wary eye and 2008 may well see a number of follow-on acquisitions by these companies to keep pace with Philips.

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Telemed Delivering for California Diabetics

This week, the California Healthcare Foundation (CHCF) announced that they were expanding a a pilot diabetes monitoring program, nearly quadrupling the number of clinics from the initial 12 to 42.

The purpose of the program was to perform retinal screening fro diabetic retinopathy, which often results in blindness.  In the pilot, which took place in the Central Valley off California, a rural agricultural area with  a large migrant population, the 12 clinics were set up with a retina scanning system that allowed doctors in remote clinics to take high-resolution retinal digital pictures, send them over the Web to California Berkeley School of Optometry for expert consultation and recommended follow-up procedures.

Over the two years of the pilot, a total of over 24,000 patients were screened, of which nearly 50% had signs off retinopathy, with 15% requiring direct referrals.

Nice example of what is possible, question is : Must foundations such as CHCF fund such programs?  Where are the payers who would apparently have the most to gain from sponsorship of studies such as this?

While I applaud CHCF for sponsoring such new, innovative approaches to delivering care, I sure would like to see much, much, more from the payers.

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