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Healthcare Execs Investing In Intelligent Technologies Face Roadbumps

Posted on July 16, 2018 I Written By

Anne Zieger is a healthcare journalist who has written about the industry for 30 years. Her work has appeared in all of the leading healthcare industry publications, and she's served as editor in chief of several healthcare B2B sites.

A recent report from Accenture concludes that healthcare executives are enthusiastic about “intelligence technologies” such as AI and IoT. It also suggests, however, that health organizations will need to add new capabilities to be sure they can manage these technologies responsibly.

The report, based on a survey of 100 health executives, found that 77% of respondents expect to invest in IoT and smart sensors and that 53% expect to invest in AI systems.  Presumably, they expect these technologies to offer benefits more quickly.

Why the gap in adoption? The truth is that healthcare leaders haven’t yet gotten their arms around AI just yet. While IoT and smart sensor technology can boost the flexibility and “judgment” of enterprise systems, AI arguably has the potential to be far more flexible and wide-reaching — and ultimately less than predictable.

This unpredictability makes AI investment a bit trickier to implement than other emerging technologies. Just over four-fifths of health leaders said they were not prepared to explain AI-based conclusions to their internal stakeholders nor outsiders.

To address this deficit, 73% said they plan to develop internal ethical standards for AI to make sure these systems can act responsibly. Before that, they’ll need to determine what “acting responsibly” actually means — and as far as I know there are no accepted guidelines for developing such standards. (They might want to start off by reviewing Google’s ethical principles for AI use here.)

Adding AI to the enterprise IT mix could also wreak havoc. I for one was surprised to read that almost one-fourth of respondents said that they had been the target of adversarial AI behaviors, including falsified location data or bot fraud. (This stat blew my mind. Why haven’t we heard more about these “adversarial behaviors” and what are they?)

This certainly adds another element of uncertainty for CIOs interested in AI investments. While AI technologies can’t “think” in the traditional sense, they can create a range of problems previous-gen technology couldn’t.

This is part of a larger picture in which health organizations aren’t sure if their data has been corrupted. In fact, 86% of health execs said they hadn’t yet invested in technologies which could verify their data sources. Adding AI to the mix could potentially compound these problems, as it might create a cascade in which the AI then draws false inferences and takes inappropriate actions.

Meanwhile, respondents were excited about blockchain and smart contracts technology, with 91% reporting that they believed it would be a critical tool for supporting frictionless businesses over the next three years. All told, expect to see IoT and blockchain investments right away, with AI lagging until health IT leaders can teach it to play nicely.

Is Amazon Ready To Protect Patient Data?

Posted on July 6, 2018 I Written By

Anne Zieger is a healthcare journalist who has written about the industry for 30 years. Her work has appeared in all of the leading healthcare industry publications, and she's served as editor in chief of several healthcare B2B sites.

Late last month, a Connecticut woman found out that a third-party Amazon vendor she had done business with had exposed her personal medical data to the world, including her medical conditions, along with her name, birthdate and emergency contact information.

The story suggests that Amazon engaged in a bit of bureaucratic foot shuffling when called on the privacy lapse. According to the woman, an Amazon call center rep told her it would investigate the issue, but a further email told her they would not be able to release the outcome of this investigation. It’s little wonder she wasn’t satisfied.

Ultimately, it appears that she was only able to get immediate action once she contacted the third-party seller, which took the photos containing the information down promptly upon her request.

Though no small matter for the woman involved, the episode means little for the future of Amazon, in and of itself. However, it does suggest that the marriage of Amazon technology and healthcare data may pose unexpected problems.

For those who have been sleeping under a rock, in late June Amazon announced that it had acquired online pharmacy PillPack for what reports say was just under $1 billion. PillPack, which competes with services delivered by giants like CVS, lets users buy their meds in pre-made doses. News stories suggest that Amazon beat out fellow retail giant Walmart in making the buy, which should close the second half of this year.

Without a doubt, this was a banner day in the history of Amazon, which has officially stamped into healthcare in 10-ton boots. The deal could not only mark the beginning of new era for the retailer, but also the healthcare industry, which hasn’t yet seen a tech company take a lead in any consumer-facing healthcare business.

That being said, perhaps a more important question for readers of this publication is how it will manage data generated by PillPack, a store likely to grow exponentially as Amazon integrates the online pharmacy into its ecosystem.

While there are obviously many good things its staggering fulfillment and logistics capabilities can bring to PillPack, Amazon’s otherwise amazing systems weren’t built to protect patient health information.

When it comes to most any other company, I’d imagine these problems could be addressed by layering HIPAA-compliant technologies and policies over its existing infrastructure. However, given the widely distributed nature of its retail network, it’s not just a matter of rethinking some architecture. Sealing off health data could require completely transforming its approach to doing business. Just about every retail transaction could prove a chink in its armor.

Since it wasn’t itself required to meet HIPAA standards in this instance, Amazon won’t get any flack from regulators over the recent PHI exposure. Still, issues like this could undercut the trust it needs to integrate PillPack into its core business successfully.

If nothing else, Amazon had better put a strong PHI protection policy in place on its retail side. Otherwise, it could undermine the business it just spent almost $1 billion to buy.

A Missed Opportunity For Telemedicine Vendors

Posted on June 29, 2018 I Written By

Anne Zieger is a healthcare journalist who has written about the industry for 30 years. Her work has appeared in all of the leading healthcare industry publications, and she's served as editor in chief of several healthcare B2B sites.

Today, most direct-to-consumer telemedicine companies operate on a very simple model.

You pay for a visit up front. You talk to the doctor via video, the doctor issues as a prescription if needed and you sign off. Thanks to the availability of e-prescribing options, it’s likely your medication will be waiting for you when you get to the pharmacy.

In my experience, the whole process often takes 45 minutes or less. This beats the heck out of having to wait in line at an urgent care center or worse, the emergency department.

But what about caring for chronic illnesses that can’t be managed by a drive-by virtual visit? Can telemedicine vendors play a role here? Maybe so.

We already know that combining telemedicine with remote monitoring devices can be very effective. In fact, some health systems have gone all-in on virtual chronic care management.

One fascinating example is the $54 million Mercy Virtual Care Center, which describes itself as a “hospital without beds.” The Center, which has a few hundred employees, monitors more than 3,800 remote patients; sponsors a telehealth stroke program offering neurology services to EDs nationwide; manages a team of virtual hospitalists caring for patient around-the-clock using virtual visit tools; and runs Mercy SafeWatch, which the Center says is the largest single-hub electronic intensive care unit in the U.S.

Another example of such hospital-based programs is Intermountain Healthcare’s ConnectCare Pro, which brings together 35 telehealth programs and more than 500 clinicians. Its purpose is to supplement existing staffers and offer specialized services in rural communities where some of the services aren’t available.

Given the success of programs that maintain complex patients remotely, I think a private telemedicine company managing chronic care services might work as well. While hospitals have financial reasons to keep such care in-house, I believe an outside vendor could profit in other ways. That’s especially the case given the emergence of wearable trackers and smartwatches, which are far cheaper than the specialized tools needed in the past.

One likely buyer for this service would be health plans.

I’ve heard some complain publicly that in essence, telemedicine coverage just encourages patients to access care more often, which defeats the purpose of using it to lower healthcare costs. However, if an outside vendor offered to manage patients with chronic illnesses, it might be a more attractive proposition.

After all, health plans are understandably wringing their hands over the staggering cost of maintaining the health of millions of diabetics. In 2017, for example, the average medical expense for people diagnosed with diabetes was about $16,750 per year, with $9,600 due to diabetes. If health plans could lay the cost off to a specialized telemedicine vendor, some real savings might be possible.

Of course, being a telemedicine-based chronic care management company would be far different than offering direct-to-consumer telemedicine services on an occasional basis. The vendor would have to have comprehensive health data management tools, an army of case managers, tight relationships with clinicians and a boatload of remote monitoring devices on hand. None of this would come cheaply.

Still, while I haven’t fully run the numbers, my guess is that this could be a sustainable business model. It’s worth a try.

Investors Competing For Health IT Opportunities

Posted on June 28, 2018 I Written By

Anne Zieger is a healthcare journalist who has written about the industry for 30 years. Her work has appeared in all of the leading healthcare industry publications, and she's served as editor in chief of several healthcare B2B sites.

A new study has concluded that investors are hungry for health IT investment opportunities, in some cases battling competitors for particularly attractive companies. The report concluded that investment firms see health IT as a lower-risk way to get a cut of the healthcare market than other possible targets.

The analysis by Bain & Company, which looks at 2017 numbers, said that the number of health IT investment deals completed last year rose to 32 from 23 in 2016.

The value of disclosed deals fell from $15.5 billion in 2016 to $1.9 billion in 2017. This is not a sign of weakness in the sector, however. The 2016 deals volume was pumped up by two megadeals (acquisitions of MultiPlan and Press Ganey), which were valued collectively at $9.9 billion. Meanwhile, in 2017 only one deal exceeded $800 million.

Deal counts and volume aside, there’s no question that investors are still very interested in acquiring or taking a stake in health IT companies, Bain reports. According to its study, there are many good reasons for their excitement.

“Investors find HCIT target attractive not only because HCIT companies play a vital role in promoting technology adoption in healthcare but also because they bear less of the direct reimbursement and regulatory risk that affect other healthcare sectors,” the report says. “With a limited set of scale assets on the market and corporate buyers willing to pay premiums for those that do become available, valuations remain high and competition intense.”

The report notes that most of the health IT buyouts in 2017 involved biopharma investments, particularly among companies using IT solutions and advanced analytics to streamline development a testing of drugs. Such deals include the buyout of Certara, which offers decision support technology for optimizing drug development, and Bracket, which sells technology for managing clinical trials.

However, investors were also interested in EMR and practice management vendors. Given that just a handful of big vendors block of the market for hospital IT, they looked elsewhere.

In particular, investment firms were interested in consolidating some of the many vendors selling ambulatory care EMRs platforms supporting specialties like gastroenterology. For example, investors picked up a $230 million stake in Modernizing Medicine, which offers EMR and practice management systems for specialties such as dermatology and ophthalmology, Bain said.

In the future, investors will gain interest in revenue cycle management software. In addition to investing in or acquiring RCM tools for providers, investors may target RCM software helping patients pay their bills. For example, private equity firm Frontier Capital bought a majority stake in medical card company AccessOne last year.

Bain also predicts that Investors will pay growing attention to clinical decision support platforms, driven in part by legislation requiring doctors to use clinical decision support tools before ordering complex diagnostic imaging of Medicare patients.

In addition, investment firms are keeping their eye on population health management software vendors. It’s not clear yet which companies will dominate the sector, and how these platforms will evolve, so dealmakers are hanging back. Still, within a few years they may well begin to throw money at PHM companies.

An Interesting Overview Of Alphabet’s Healthcare Investments

Posted on June 27, 2018 I Written By

Anne Zieger is a healthcare journalist who has written about the industry for 30 years. Her work has appeared in all of the leading healthcare industry publications, and she's served as editor in chief of several healthcare B2B sites.

Recently I’ve begun reading a blog called The Medical Futurist which offers some very interesting fare. In addition to some intriguing speculation, it includes some research that I haven’t seen anywhere else. (It is written by a physician named Bertalan Mesko.)

In this case, Mesko has buried a shrewd and well-researched piece on Alphabet’s healthcare investments in an otherwise rambling article. (The rambling part is actually pretty interesting on its own, by the way.)

The piece offers a rather comprehensive update on Alphabet’s investments in and partnerships with healthcare-related companies, suggesting that no other contender in Silicon Valley is investing in this sector heavily as Alphabet’s GV (formerly Google Ventures). I don’t know if he’s right about this, but it’s probably true.

By Mesko’s count, GV has backed almost 60 health-related enterprises since the fund was first kicked off in 2009. These investments include direct-to-consumer genetic testing firm 23andme, health insurance company Oscar Health, telemedicine venture Doctor on Demand and Flatiron Health, which is building an oncology-focused data platform.

Mesko also points out that GV has had an admirable track record so far, with five of the companies it first backed going public in the last year. I’m not sure I agree that going public is per se a sign of success — a lot depends on how the IPO is received by Wall Street– but I see his logic.

In addition, he notes that Alphabet is stocking up on intellectual resources. The article cites research by Ernest & Young reporting that Alphabet filed 186 healthcare-related patents between 2013 and 2017.

Most of these patents are related to DeepMind, which Google acquired in 2014, and Verily Life Sciences (formerly Google Life Sciences). While these deals are interesting in and of themselves, on a broader level the patents demonstrate Alphabet’s interest in treating chronic illnesses like diabetes and the use of bioelectronics, he says.

Meanwhile, Verily continues to work on a genetic data-collecting initiative known as the Baseline Study. It plans to leverage this data, using some of the same algorithms behind Google’s search technology, to pinpoint what makes people healthy.

It’s a grand and somewhat intimidating picture.

Obviously, there’s a lot more to discuss here, and even Mesko’s in-depth piece barely scratches the surface of what can come out of Alphabet and Google’s health investments. Regardless, it’s worth keeping track of their activity in the sector even if you find it overwhelming. You may be working for one of those companies someday.

MD Anderson Fined $4.3 Million For HIPAA Violations

Posted on June 21, 2018 I Written By

Anne Zieger is a healthcare journalist who has written about the industry for 30 years. Her work has appeared in all of the leading healthcare industry publications, and she's served as editor in chief of several healthcare B2B sites.

An administrative law judge has ruled that MD Anderson Cancer Center must pay $4.3 million to the HHS Office of Civil Rights due to multiple HIPAA violations. This is the fourth largest penalty ever awarded to OCR.

OCR kicked off an investigation of MD Anderson in the wake of three separate data breach reports in 2012 and 2013. One of the breaches sprung from the theft of an unencrypted laptop from the home of an MD Anderson employee. The other two involved the loss of unencrypted USB thumb drives which held protected health information on over 33,500 patients.

Maybe — just maybe — MD Anderson could’ve gotten away with this or paid a much smaller fine. But given the circumstances, it was not going to get away that easily.

OCR found that while the organization had written encryption policies going back to 2006, it wasn’t following them that closely. What’s more, MD Anderson’s own risk analyses had found that a lack of device-level encryption could threaten the security of ePHI.

Adding insult to injury, MD Anderson didn’t begin to adopt enterprise-wide security technology until 2011. Also, it didn’t take action to encrypt data on its devices containing ePHI during the period between March 2011 and January 2013.

In defending itself, the organization argued that it was not obligated to encrypt data on its devices. It also claimed that the ePHI which was breached was for research, which meant that it was not subject to HIPAA penalties. In addition, its attorneys argued that the penalties accrued to OCR were unreasonable.

The administrative law judge wasn’t buying it. In fact, the judge took an axe to its arguments, saying that MD Anderson’s “dilatory conduct is shocking given the high risk to its patients resulting from the unauthorized disclosure of ePHI,” noting that its leaders “not only recognized, but [also] restated many times.” That’s strong language, the like of which I’ve never seen in HIPAA cases before.

You won’t be surprised to learn that the administrative law judge agreed to OCR’s sanctions, which included penalties for each day of MD Anderson’s lack of HIPAA compliance and for each record of individuals breached.

All I can say is wow. Could the Cancer Center’s leaders possibly have more chutzpah? It’s bad enough to have patient data breached three times. Defending yourself by essentially saying it was no big deal is even worse. If I were the judge I would’ve thrown the book at them too.

Exec Tells Congress That New Health Data Threats Are Emerging

Posted on June 20, 2018 I Written By

Anne Zieger is a healthcare journalist who has written about the industry for 30 years. Her work has appeared in all of the leading healthcare industry publications, and she's served as editor in chief of several healthcare B2B sites.

A senior security executive with a major academic health system has told Congress that in addition to attacks by random attackers, healthcare organizations are facing new threats which are changing the health security landscape.

Erik Decker, chief security and privacy officer with the University of Chicago Medicine, testified on behalf of the Association for Executives in Healthcare Information Security in mid-June. He made his comments in support of the reauthorization of the Pandemic and All-Hazards Preparedness Act, whose purpose is to improve the U.S. public health and medical preparedness for emergencies.

In his testimony, Decker laid out how the nature of provider and public health preparedness has changed as digital health technology has become the backbone of the industry.

He described how healthcare information use has evolved, explaining to legislators how the digitization of healthcare has created a “hyper-connected” environment in which systems such as EHRs, revenue cycle platforms, imaging and ERP software are linked to specialty applications, the cloud and connected medical devices.

He also told them about the increasing need for healthcare organizations to share data smoothly, and the impact this has had on the healthcare data infrastructure. “There is increasing reliance on these data being available, and confidential, to support these nuanced clinical workflows,” he said. “With the adoption of this technology, the technical ecosystem has exploded in complexity.”

While the emergence of these complex digital health offers many advantages, it has led to a growth in the number and type of cybersecurity problems providers face, Decker noted. New threats he identified include:

* The development of underground markets and exchanges of sensitive information and services such as Hacking-as-a Service
* The emergence of sophisticated hacking groups deploying ransomware
* New cyberattacks by terrorist organizations
* Efforts by nation states to steal intellectual property to create national economic advantages

This led to the key point of his testimony: “We can no longer think of preparedness relative only to natural disasters or pandemics,” Decker said. “It’s imperative that we acknowledge the criticality of cybersecurity threats levied against the nation’s healthcare system.”

To address such problems, Decker suggests, healthcare organizations will need help from the federal government. For example, he pointed out, HHS efforts made a big difference when it jumped in quickly and worked closely with healthcare leaders responding to WannaCry attacks in mid-2017.

Meanwhile, to encourage the healthcare industry to adopt strong cybersecurity practices, it’s important to offer providers some incentives, including a financial subsidy or safe harbors from enforcement actions, he argued.

Stanford Survey Generates Predictable Result: Doctors Want EHR Changes

Posted on June 11, 2018 I Written By

Anne Zieger is a healthcare journalist who has written about the industry for 30 years. Her work has appeared in all of the leading healthcare industry publications, and she's served as editor in chief of several healthcare B2B sites.

I know you’re going to have trouble believing this, but many PCPs think EHRs need substantial changes.

Such is the unsurprising conclusion drawn by a survey conducted by The Harris Poll on behalf of Stanford Medicine. The poll, which took place between March 2 and March 27 of this year, surveyed 521 PCPs licensed to practice in the U.S. who have been using their current EHR system for at least one month.

The physicians were recruited via snail mail from the American Medical Association Masterfile. Figures for years in practice by gender, region and primary medical specialty were weighted where necessary to bring them into line with their actual proportions in the population of PCPs in the U.S.

According to the survey, about two-thirds of PCPs think EHRs have generally improved care (63%). Two-thirds said they were at least somewhat satisfied with their current systems, though only 18% were very satisfied.

Meanwhile, a total of 34% were somewhat or very dissatisfied with their system, and 40% of PCPs said that EHRs create more challenges than benefits. Also, 49% of office-based PCPs reported that using an EHR detracts from their clinical effectiveness.  Forty-four percent of PCPs said that primary value of EHRs is data storage, while just 8% said that the biggest benefits were clinically-related.

To improve EHRs’ clinical value, it will take a lot of effort, with 51% saying they think EHRs need a complete overhaul.  Seventy-two percent of PCPs said that improving user interfaces could best address their needs in the immediate future.

Meanwhile, 67% of respondents said that solving interoperability problems should be the top priority for EHR development over the next decade, and 43% reported wanting improved predictive analytics capabilities.

Nearly all (99%) of PCPs said that EHR capabilities should include maintaining a high-quality record of patient data over time, followed closely by providing an intuitive user experience. Also, 88% said that providing clinical decision support at the moment of care was important, followed by identifying high-risk patients in their patient panel (86%).

When asked what EHR features they found most satisfying, they cited maintaining a high-quality patient record (73%), offering patients access to medical records (71%), sharing information with providers across the care continuum (65%) and supporting practice/revenue cycle management needs (60%).

However, EHRs still have a long way to go in offering other preferred capabilities, including changing and adapting in response to user feedback, improving patient-provider interaction, coordinating care for patients with complex conditions and engaging patients in prescribed care plans through mobile technologies. Vendors, you have been warned.

Health IT Leaders Fear Insider Security Threats More Than Cyberattacks

Posted on June 8, 2018 I Written By

Anne Zieger is a healthcare journalist who has written about the industry for 30 years. Her work has appeared in all of the leading healthcare industry publications, and she's served as editor in chief of several healthcare B2B sites.

A recently-published survey suggests that while most health IT security leaders feel confident they can handle external attacks, they worry about insider threats.

Cybersecurity vendor Imperva spoke with 102 health IT professionals at the recent HIMSS show to find out what their most pressing security concerns were and how prepared they were to address them.

The survey found that 73% of organizations had a senior information security leader such as a CISO in place. Another 14% were hoping to hire one within the next 12 months. Only 14% said they didn’t have a senior infosec pro in place and weren’t looking to hire.

Given how many organizations have or plan to have a security professional in place, it’s not surprising to read that 93% of respondents were either “very concerned” or “concerned” about a cyberattack affecting their organization. The type of cyberattacks that concerned them most included ransomware (32%), insider threats (25%), comprised applications (19%) and DDoS attacks (13%). (Eleven percent of responses fell into the “other” category.)

Despite their concerns, however, the tech pros felt they were prepared for most of these threats, with 52% that they were “very confident” or had “above average” confidence they could handle any attack, along with 32% stating that their defenses were “adequate.”  Just 9% said that their cybersecurity approach needed work, followed by 6% reporting that their defenses needed to be rebuilt.

Thirty-eight percent of the health IT pros said they’d been hit with a cyberattack during the past year, with another 4% reporting having been attacked more than a year ago.

Given the prevalence of cyberthreats, three-quarters of respondents said they had a cybersecurity incident response plan in place, with another 12% saying they planned to develop one during the next 12 months. Only 14% didn’t have a plan nor was creating one on their radar.

When it came to external threats, on the other hand, respondents seemed to be warier and less prepared. They were most worried about careless users (51%), compromised users (25%) and malicious users (24%).

Their concerns seem to be compounded by a sense that insider threats can be hard to detect. Catching insiders was difficult for a number of reasons, including having a large number of employees, contractors and business partners with access to their network (24%), more company assets on the network or in the cloud than previously (24%), lack of staff to analyze permissions data on employee access (25%) and a lack of tools to monitor insider activities (27%).

The respondents said the most time-consuming tasks involved in investigating/responding to insider threats included collecting information from diverse security tools (32%), followed by tuning security tools (26%), forensics or incident analysis (24%) and managing too many security alerts (17%).

IBM Watson Health Layoffs Suggests AI Strategy Isn’t Working

Posted on June 6, 2018 I Written By

Anne Zieger is a healthcare journalist who has written about the industry for 30 years. Her work has appeared in all of the leading healthcare industry publications, and she's served as editor in chief of several healthcare B2B sites.

IBM Watson Health is apparently making massive cuts to its staff, in a move suggesting that its healthcare AI isn’t working.

Watson Health leaders have argued that AI (which Watson Health leaders call “cognitive computing”) as the solution to many of the healthcare industry’s problems. IBM pitched Watson technology as a revolutionary tool which could get to the root of difficult medical problems.

Over time, however, it’s begun to look like this wasn’t going to happen, at least for the present. Among other high-profile goofs, IBM Watson has struggled with applying the supercomputing tech to oncology, which was one of its main goals.

Now IBM Watson Health has slashed up to 70% of its staff, according to sources speaking to The Register. The site reports that most of the layoffs are cutting staff within companies IBM has brought in an effort to build out its healthcare credentials. These include medical data company Truven, acquired in 2016 for $2.6 billion, medical imaging firm Merge, bought in 2015 for $1 billion and healthcare management firm Phytel, the site reports.

The cuts reflect a major strategic shift for Watson Health, which was one of IBM’s flagship divisions until recently. Having invested heavily in businesses that might have helped it dominate the health IT world, it now appears to be rethinking it’s all in approach.

That being said, no one has suggested that IBM Watson Health will disappear in a poof of smoke. IBM corporate leaders seem dedicated to an AI future. However, if this report is correct, Watson Health is being reorganized completely. Not too much of a surprise since given how hyped it was, it would have been almost impossible for it to live up to the hype.

To me, this suggests that rolling out healthcare AI tools might call for a completely different business model. Rather than applying brute force supercomputing tools to enterprise healthcare issues, it may be better to build from the ground up.

For example, consider Google’s approach to healthcare AI supercomputing. UK-based DeepMind is building relationships and products from the ground up. Working with the National Health Service DeepMind Health is bringing mobile tools and AI research to hospitals. Its mobile health tools include Streams, a secure mobile phone app which feeds critical medical information to doctors and hospitals.

In my opinion, the future of AI in healthcare will look more like the DeepMind model and less like IBM Watson’s top-down approach. Building out AI-based tools and platforms for physicians and nurses first just makes sense.