Bouncing from the Health 2.0 event last week to Connected for Health Symposium here in Boston, organized by Partners Healthcare, I’ll be reporting on some of the key presentations. Will also be moderating the afternoon session on the major platform plays, Dossia, Google Health, HealthVault and WebMD who is not exactly a platform but certainly the 800 lbs. gorilla in the PHR market.
8:15am, Keynote: MA Senator and former presidential nominee John Kerry has taken the stage. Kerry wastes no time in hitting McCain hard on his healthcare policies. Under current administration, healthcare premiums have gone up 78%, Starbucks spends more on healthcare than coffee, GM spends more on healthcare than steel. Not exactly the fault of the current administration, but Kerry wants to put it on their doorstep though it really needs to be put on the doorstep of all branches of government.
Kerry now talking about the lack of effort in promoting prevention. Reflected on his own cancer story, prostrate, which was caught early. “Healthcare system is overburdened due to the stupid choices we make.” We do not focus on prevention where the real savings are.
Kerry went on to claim that the recently passed legislation to promote adoption of eRx as the most significant healthcare legislation passed in recent history. Even mentions the good work of Newt Gingrich claiming he was instrumental in getting the eRx legislation through Congress.
Moving on to Q&A with Kerry. Asked about physician rating services. Believes it is necessary that accountability is needed in medicine and would like to see the medical profession do a better job of policing itself. Does not want to see the government step in to do this as they will not do it well. Sees healthcare as not under-regulated, just poorly regulated. Takes a shot at CMS claiming it is extremely opaque and not terribly effective. Lays partial blame on OMB, which sets a number of the rules. Does not want the government to take a heavy hand in regulating healthcare as he is concerned that this will stifle innovation.
Question: With the current economic crisis unfolding, will this put healthcare legislation and change via a new administration on the back-burner? Kerry: we are in a deep financial crisis that will led to the next president’s primary task being the establishment of confidence in the market. That must be addressed first before we can move to other important issues. Sees the need for government to invest directly in the economy, e.g., healthcare, infrastructure, etc.
Ques: How can government foster EMR adoption? Kerry rattles of some statistics on Partners’ HIT adoption. Kerry then goes on to give the bromide of we need interoperability.
Ques: How can we get some of the senators holding back HIT legislation to move forward? Kerry stated that security and privacy are a key issue that is hindering movement on this legislation but points to examples in other markets that privacy and security can be adequately addressed.
Kerry closed by expressing great frustration wit the OMB scoring of legislation process – a process by which proposed legislation is evaluated by OMB as to its potential impact. Kerry strongly stated that OMB looks at just costs but does not give a fair shake to potential savings.
Note: Kerry, with Gingrich and Billy Beane had an Op-Ed in the Sunday NYTimes.
8:45am Next up: Susannah Fox from Pew Charitable Trust: “Participatory Medicine” Starts off with a PR from 2001 where the AMA cautioned consumers from going online to get healthcare information. Obviously, consumers have ignored this AMA, protect our turf, statement. 12% of Internet users participate in online health communities and nearly 25% of those between ages of 18-39 use one of these communities.
Pew research has found that about one third of those who go online for health information have been helped in a significant way. Only about 3% have actually been harmed. Order of magnitude difference. There research has also found that the first line of information inquiry by a consumer is a physician (roughly 80%).
Argues that healthcare is stuck in the broadcast world – information targeted at you and not include you is a dated model that healthcare sector is still using and will not work in the future. Consumers will look elsewhere to the risk of healthcare incumbents. Encourages the healthcare sector to open up and share information more aggressively, actively engaging the consumer. Get the consumers to participate, not just observe.
Pew breaks out population by: Elite tech users (31%), mid-range (20%) and low tech (49%). Online cancer forums are 96% white and over 75% with a college education (UNC study). Argues Web 2.0 is not being used by the vast majority o Americans today (clearly, if those stats are to be believed). Engaging the low tech community (particularly Latinos and African Americans) are highly connected via their cell phones. mHealth is where it is at to engage these communities.
Her seven word challenge/closing:
Recruit Doctors, Let e-Patients Lead, Go Mobile
Do not listen to AMA from 2001, do not take a closed aproach and do not end up in the same boat that the recording industry was left in when consumers went online for music. Get out there and actively engage consumers wth regards to their health. Make it participatory medicine.
10:00am Panel Session on Primary Care and Coordinating Chronic Care: Panelists include George Chadraoui, IBM Healthcare Benefits Leader, David Hom, formerly of Pitney Bowes (he played a leading role getting Pitnet Bowes to sign on to Dossia), Edwina Rogers, Dir. Patient0centered Primary Care Collaborative and Vince Kuratis, of Better Health Technologies and blogger – e-CareManagement.
Main focus seems to be on the concept o the “Medical Home” Rogers sees a very large growth opportuntiy fr “disease management” companies to tap into the Medical Home concept delivering services to primary care physicians to enable them to do better chronic care mgmt. Hom, sees 24/7 telemedicine coupled to incentives and the PCP (primary care physicians). to make this all work. Unfortunately, what Hom is seeing today is proliferation of a multitude of messages being sent to the consumer and simply overwhelming and confusing them. Vince makes an astute observation that CMS (Medicare) is putting the onus on the PCP for chronic care mgmt whereas in the broader market health plans are delivering /handling much of the load.
Medicare is looking at reimbursement models of $30 to over $100 chronic care mgmt. Rogers sees this as providing some significant funding to chronic care mgmt concepts and innovators. Hom counters that there is still high degree of fragmentation, most often created by health plans. Hom sees PHRs as having the potential to bridge many of the gaps and fragmentation today. But Hom goes on to state that the proliferation of solutions arriving in the market is making the decision process as to what solution to chose far more difficult which may stunt overall adoption.
Issue raised, the continuing and growing problem of shortage of PCPs to actually implement the medical home concept. Rogers comments that if we can realign incentives and make it worthwhile for med students to pursue a PCP occupation, we will not have a shortage.
11:00am Panel on Wireless and Mobile Services for Connected Health: Check the agenda at the Symposium website for panelists (Verizon, Qualcomm, WellDoc and Sensei represented). How is the iPhone & smart phone technology facilitate care. 200M iPhone apps have been downloaded to date, per Jobs Q3 call last week. Represents nearly $1M/day in spend on iPhone apps. Cell phones tend to be very personal, portable devices that have become extremely pervasive. Cell phone operators are finding that children’s use of SMS is forcing parents/older generation t use this technology.
Interesting question by the moderator: When will large sophisticated health organizations such as Partners will automatically update your PHR via a cell phone/wireless when you pay a visit to a Partners’ physician. One respondent, the financial services industry is moving forward on this type of concept, but the healthcare industry is not. That being said, healthcare has many of the similar concerns as the financial market. Another counters that we need to walk before we can run and unlike financial sector, healthcare is very fragmented and HIT adoption is likewise fragmented at the physician practice level.
Sure is and market forces may start to push the envelop, though it will be excruciatingly slow, thus most likely to occur outside of the traditional healthcare sector/practice and bubble up via consumers just moving ahead leaving many physicians behind. Believe this was also the message that Susannah Fox was trying to convey to this audience.
Panelist just confirmed what I put in italics above.
Metric: $100B/yr in revenue generated worldwide for cell phone operators from SMS/texting.
The business model or mHealth: A value proposition needs to be created for the consumer that will actively engage them. Needs to be a highly personalized interaction thus needs strong intelligence to identify what is imortant to a given user and delivering only what is of interest to that specific consumer. SPAM, adverts, etc. will not work on a mobile device – something that consumers will not tolerate. Regarding the scaling of mHealth, one panelists sees Wal-Mart, India and new health gaming-type apps as driving future growth. Another panelist encouraged developers to go directly after payers, they are the ones with deep pockets and need (No Duh!).
Keep waiting for something interesting, nothing out of this panel, just more substantiation of what has been said before in other venues. But hey, I’ll cut them some slack as maybe for this audience its all new.
2:15pm, Panel Session, VCs Talk About Who will Make $$$ in Connected Health & Why: Pack house for this session, standing room only.
In New England region about 20 investor (angel) groups. They meet monthly to consider investment options. They are finding that the VCs have really pulled back on investing in the last month or so. Encouraging companies to have a Plan A & B Plan A we come out of the financial crisis in a year or so. Plan B, financial crisis and tight credit markets continue for 2-3 years. Finding it very difficult for new start-ups to get money, slightly easier to get $$$ to scale-up.
VCs looking for cash efficient companies and models that will quickly get them to cash-flow positive in a far shorter period of time than in the past. Contraction – looking to place fewer rounds in any given entity. Nationally, VCs raised $30B in capital in 2007, for ’08 looking at $20B and for ’09 roughly $16B (half of what was available in ’07). Project high mortality rate for many existing VCs. Advising companies that they need to significantly decrease burn rate to survive the next 12-18 months. There will be very little new money to go around. Don’t over-engineer the product, focus on only those features that are absolutely needed for a product to gain traction.
Start-ups need not show near-term profitability but do need to articulate a clear commercialization model that shows a path to break-even in 3-4 years. So it is not so much an issue of profitability now, but demonstrating a good model to get you there.
Warning, next 12-24 months will be very hostile.
Business models that seem to be working…
Recurring revenue models focused on a B2B2C model. The B2C model is not attractive to VCs. This is not unlike what I observed and commented upon last week at the Health 2.0 event.
One of the VCs is seeing too many companies that say: “Hey we have a great product/service for payers, providers, employers, etc.” This actually turns this VC guy off as he is looking for companies that demonstrate focus and are not trying to tackle numerous markets and subsequently, trying to develop numerous channels. Just won’t get to profitability fast enouh in his tight credit market.
Big problem for VC firms today is liquidity in the market to provide them an exit strategy. Right now, VCs have very few exit options which severely constrains their model and thus cascades into their ability to fund new ideas/strat-ups. About the only exit strategy today is mergers or acquisitions.
None of the VCs on ths panel are terribly interested in Health 2.0 apps. More interested in new diagnostics that can be used by small practices and remote monitoring/sensor apps. See good opportunities here. Another is also looking at genetic testing, genomics & personalized medicine.
5:45pm Continua Alliance Demonstration: Currently, they are running through all the various companies that are a part of the demo, a literal who’s who including IBM, Oracle, Google Health (they along with Dossia recently signed on to Continua, Microsoft HealthVault is now the odd man out here), a number of mostly small device vendors with exception of Philips who will demo their new Mtiva platform for remote chronic care monitoring.
First demo has an “elderly woman”, Natasha, taking simple vital sign measurements. Very simplistic GUI. Next, a remote caregiver, using Motiva, clearly shows Natasha’s trending data for evaluation. Caregiver sees a disturbing trend (weight gain) and pushes data to a physician. Physician now takes the stage, logs in and sees a new report has arrived (Natasha’s) for review. Shows simple data fields in columns – surprisingly does not appear to demonstrate any analytic capabilities to pick out what may be outliers in the data set to quickly flag data/areas of concern. Yes, this may not b an area that Continua is focused on – they focus on remote device data interoperability. Still would expect more in such a demo. Odd.
Demo 2 has a consumer with type 2 diabetes and obesity. He takes various vital measurements (weight, glucose), records them and data is automatically pushed to caregiver. Caregiver reviews data and using Continua format (its a combination of IHE & HL7 CCD standards), pushes data to the consumer dietitian and the consumer’s Google Health account (hmm, Google doesn’t support CCD yet, so how did they do that?)
Both pretty simplistic demos that came across as more of a stage for all the various Continua Alliance partners than really doing something interesting. Continua is now about 2 years old so they have made some good progress on device interoperability and I’m sure there will be more interesting applications next year.