A new Definitive Healthcare survey polled healthcare leaders on the most important trends of the year.


Industry consolidation was listed as the most important trend of the year, leading the way with 25.2% of the votes, followed by consumerism at 14.4%.

Definitive tracked 803 mergers and acquisitions along with 858 affiliation and partnership announcements last year, a trend that is not expected to slow in 2019.

Thirty-five percent of healthcare M&A activity occurred in the long-term care field, according to CEO Jason Krantz.

Widespread industry consolidation as well as the growing influence of consumerism registered as the most important trends healthcare leaders are paying attention to in 2019, according to a Definitive Healthcare survey released Monday morning.

Industry consolidation was listed as the most important trend of the year, leading the way with 25.2% of the votes, followed by consumerism at 14.4%.

Other topics that received double-digit percentages of the vote were telehealth at 13.8%, AI and machine learning at 11.4%, and staffing shortages at 11.1%. Cybersecurity, EHR optimization, and wearables rounded out the list.

The top results are generally in-line with some of the top storylines from the past year in healthcare, including focus on several vertical megamergers and longstanding business models being redefined by consumer behavior.

Jason Krantz, CEO of Definitive Healthcare, told HealthLeaders that healthcare is becoming increasingly more complicated and leaders are looking at a host of business strategies to navigate industry challenges or emerging market conditions.

“Something that’s on the mind of all of the people that [Definitive Healthcare] has been talking to, whether they are pharma leaders, healthcare IT companies, or providers, is that they’re constantly grappling with all of these new regulations, consolidation, and new technologies,” Krantz said. “[They’re asking] ‘What does that mean for my business and how do I address my strategy as a result?'”

In 2018, Definitive tracked 803 mergers and acquisitions along with 858 affiliation and partnership announcements, a trend Krantz does not expect to slow in 2019.

While Krantz cited some of the major health system mergers from last year as examples, he said another area that is experiencing widespread M&A activity is the post-acute care side.

Thirty-five percent of healthcare M&A activity occurred in the long-term care field, according to Krantz, and this is indicative of hospitals seeking to control costs and drive down rising readmission rates.

It also relates to another issue likely to accelerate in the coming years, which are the staffing shortages facing providers.

The sector currently suffering the most are long-term care facilities, which struggle to maintain an adequate nursing workforce due to the advanced age of most doctors and nurses in the face of the rapidly aging baby boomer generation. Krantz warns that all providers are likely to face these issues going forward.

Krantz also expects consumerism to hold steady as a top issue facing healthcare, citing the growing popularity of urgent care centers and the interconnection of telehealth services to provide patients with care outside of the traditional delivery sites.

However, the growth of these are reliable business options are all dependent on figuring out an adequate reimbursement rates for telehealth services rendered, Krantz said, which has not been fully addressed.

“I think until [telehealth reimbursement rates] get completely figured out, it’s hard for the providers to invest heavily in it,” Krantz said. “This is why you see a lot of non-traditional providers getting into telehealth, but I think it is something that people are thinking about and they know they need to adjust to, though nobody’s stepping up and being first in [telehealth] right now.”

For AI, machine learning, wearables, and cybersecurity, though the responses are split into smaller amounts, Krantz emphasized their combined score, which encompasses more than 25% of total votes, as a sign that healthcare leaders are paying attention to the area despite market complexity.

He added that they are all interconnected issues that deal with technological changes health systems are aware they will have to address in the coming years.

One issue related to harnessing technological change is EHR optimization, which Krantz believes leaders on the provider side are finally starting to gain excitement around. He said most leaders who have waited years to set up a comprehensive EHR system and input data are in-line to now utilize the data in their respective system.

“There’s a lot of great data in there and people are starting to figure out how to utilize that and improve patient outcomes based on the sharing of data,” Krantz said. 




Medicines Only Work if Patients Can Afford Them: Solutions For The High Drug Prices Era

Since 2000, more than 500 new medicines have been approved by the Food and Drug Administration. Because of those medicines, many Americans are living longer, better and more active lives. However, new medicines often come with high price tags. And in an environment of rising drug costs, affordability isn’t just a simple matter of economics — it can play a significant role in determining health outcomes.

Perhaps no other drug better illustrates the effect of cost on health than insulin. Over the past decade, insulin prices in the United States have tripled. Most of that increase has been driven by analog insulin medications, which are the newest forms of synthetic insulin. For example, the price of one brand of analog insulin, Humalog, was just $20 per vial in 1996. Today, it’s $275 per vial — a 1,275% increase. (Eli Lilly, the drug’s manufacturer, announced it will soon offer an “authorized generic” of the drug at a 50% discount.)

With insurers’ and patients’ out of pocket costs on the rise, a new report from researchers at Yale University finds that one-quarter of patients with Type 1 or 2 diabetes say they ration their medication. 

This is, to put it simply, bad news all around. When patients don’t take their medications as prescribed, they not only get sicker, but their ailments also become more expensive to treat. One report showed that patients who didn’t take their Type 2 diabetes medications developed complications that cost the U.S. health system $4 billion a year.

Studies like these often leave doctors and nurses scratching their heads, wondering if anything can be done to bridge the affordability gap in order to make it more likely that patients will purchase and take life-saving medicines. One obvious solution is to prescribe less expensive medications. But that only works if the less expensive medications are just as effective as their more costly counterparts. 

Which can sometimes be the case with insulin.

Last year, CareMore, the healthcare system that I lead, partnered with independent researchers from Brigham and Women’s Hospital and Harvard Medical School to study the effects of a program CareMore implemented to switch Type 2 diabetic patients from analog insulin to less expensive humaninsulin. Human insulin first came on the market in the early 1980s and costs about one-tenth as much as analog insulin. (The names can be a bit confusing; both medications are synthetic forms of insulin produced in a laboratory.)

However, our study, published in the Journal of the American Medical Association (JAMA), found that human insulin was just as effective as analog insulin at stabilizing blood sugar levels. This conclusion, frankly, wasn’t entirely surprising. A 2018 study conducted by Kaiser Permanente found that patients who took human insulin were no more likely to need additional health care than their counterparts who took analog insulin.

Crucially, our study found that the switch to human insulin also translated into lower costs for patients. Before the switch, one-fifth of the patients we studied reached the Medicare Part D coverage gap, or “donut hole,” where patients pay substantially higher costs for prescription drugs. After the switch, just 11.1% reached that gap.

Moreover, our analysis found that the program can be replicated safely and at-scale. If even a small proportion of Medicare beneficiaries with Type 2 diabetes switched to human insulin, the resulting savings to the health care system would be substantial.

Switching to lower-cost, older, equivalent medications is one way to increase medication adherence and improve health outcomes. Another, it turns out, is simply to charge patients less. 

In a landmark 2011 study, researchers studied patients who had suffered heart attacks. Normally, these patients have a low rate of medication adherence. But Harvard Medical School professors Niteesh Choudhry and William Shrank, two of the study’s lead authors found that when drug copayments were eliminated, medication adherence rates increased while overall health costs remained constant. 

One might wonder why costs didn’t go up. After all, the co-pays were eliminated and, as adherence improved, the volume of prescriptions filled increased. University of Michigan researchers A. Mark Fendrick and Rajender Agarwal may have the answer.

In a 2018 report, they found that when insurers eliminated co-payments or took other actions to make drugs more affordable, their drug costs went up — but the total cost of insuring patients did not. In fact, in some cases the cost of providing care actually decreased. Fendrick and Agarwal say that’s because patients who take their medications stay healthier and are less likely to require hospitalizations and other expensive types of care. 

None of this is to say that new drug therapies or other cutting-edge treatments don’t have value. On the contrary, they help people live longer, better lives. But in a world of increasing health costs, prescribing life-saving medications for our patients isn’t enough. Physicians, health plans and pharmaceutical manufacturers have to ensure that patients can afford to take them, as well.




The Biggest Growth Opportunities in Healthcare

Healthcare growth opportunities for 2019 should pivot around the three big themes: digital transformation, value-based care, and patient-centricity, according to a new report.

According to Frost & Sullivan’s report, “Global Healthcare Market Outlook, 2019,” digitization of products, services, and commerce models are democratizing current healthcare systems, manifesting a new era of healthcare consumerism.

“Now the new vision for healthcare is not just about access, quality, and affordability but also about predictive, preventive, and outcomes-based care models promoting social and financial inclusion,” says Kamaljit Behera, transformational health industry analyst at Frost & Sullivan, and author of the report. “This makes digital transformation and realization of long-pending policies reform a key growth priority for healthcare executives and major health systems during 2019 globally.”

According to Behera, increasing pricing pressure and shifting the focus of the healthcare industry from a volume- to value-based care model demands that drug and device manufacturers elevate their business models beyond products to customer-centric intelligent platforms and solutions.

“In 2019, the healthcare market will continue to transit and stick into the value-based model,” Behera says. “More sophisticated outcomes-based models will get deployed in developed markets, and emerging nations will start following the best practices suited to their local needs.”

Despite the promise of digital transformation, the potential promise and actual commercial application still remain the poles apart from some of the most touted technologies like AI and blockchain, according to Behera.

“Current technology is often perceived to increase the barriers between patient and providers,” he says. “In order to bridge these gaps, healthcare executives need to change the debate around digital transformation and start look beyond the mirage of technology novelty and really focus on the outcomes.”

Behera predicts that these five areas will be the biggest areas of growth for healthcare in 2019:

1. Meaningful small data

Healthcare data analytics focus will shift from ‘big data’ to ‘meaningful small data’ by hospital specialty, according to Behera. “Increasing digitization of healthcare workflows is leading us to a data explosion along the care cycle, globally,” he says. “This makes insights generation from existing healthcare data for targeted use cases a relatively low-hanging opportunity relative to other emerging technologies. Additionally, health data being the ‘holy grail,’ the analytics solutions are considered the first foundational step to catalyze complementing technology promises leveraging healthcare data (e.g., artificial intelligence, cloud computing, and blockchain).”

Entailing this, Frost & Sullivan research projects the healthcare analytics market revenue to cross $7.4 billion in the United States by the end of 2020.

 “The key pivotal theme driving this growth opportunity includes population health management, financial performance improvement, and operational automation by patients, payers, physicians, and procedures,” Behera says. “Also, the rise of value-based care and outcomes-based reimbursement programs will continue to boost the demand for specialized analytics solutions.”

In 2019, payers and providers will continue to prioritize and leverage the potential of specialty-specific analytics solutions to investigate drug utilization, treatment variability, clinical trial eligibility, billing discrepancy, and self-care program attribution specific to major chronic conditions, according to Beherea.

2. Digital health coming of age with increased focus on individual care

“During 2019, we project application of digital health will continue to go far beyond the traditional systems and empower individuals to be able to manage their own health,” Behera says.

Favorable reimbursement policies (e.g., toward clinically relevant digital health applications) will expand care delivery models beyond physical medicine to include behavioral health, digital wellness therapies, dentistry, nutrition, and prescription management, according to Behera.

“For example, major insurance bodies are already using digital health services to communicate with patients,” he says. “Traditionally, lack of formal reimbursement processes is actually a deterrent to the uptake of these—wearables, telehealth etc. The next 12 months will see a relaxation of reimbursement rules for digital health solutions.”

The global aging population and an expanding middle class are major contributors to the chronic disease epidemic and surging healthcare costs, Behera says. “This year will be a pivotal year for defining value for healthcare innovation and technology for digital health solutions catering to aged care and chronic conditions management to bending healthcare cost curve,” he says.

“Telemedicine in emerging markets will become more mainstream and will aim to become a managed services provider [rather] than being just a telemedicine platform,” he says. “Telemedicine will move into the public health space as well, with countries like Singapore is testing the platforms in a regulatory sandbox. Finally, as the lines between retail, IT, and healthcare continue to blur, non-traditional players such as Amazon, Apple, Google, Ali Health, Microsoft, and IBM, among others, will continue to make further headway into the individual care space— providing the required impetus to public health systems to ensure accessibility and affordability of care-leveraging, patient-centric digital health tools and solutions.”

Healthcare executives should prioritize their roadmap for growing IoMT and connected health ecosystems (device-, wearables-, and mHealth-generated individual health data) in order to monetize these new sources of innovation and service-oriented future revenue streams, according to Behera. “The future focus should shift from drug and device mind-set to intelligent solutions/services, demonstrating outcomes-based health benefits to individuals and their caregivers,” he says.

3. AI

In next 12 to 18 months, the priority will be to bring AI/cognitive platform technology use cases closer to clinical care to augment the physicians and even patients with actionable decision-making ability, according to Behera. “In next two to three years, AI will become a common theme across all digital initiative and platforms.”

AI-based work flow optimization use cases will represent more than 80% of the workflow market contribution. These include:

  • The elimination of unnecessary procedures and costs
  • In-patient care and hospital management
  • Patient data and risk analytics
  • Claim processing
  • Optimizing the drug discovery process

“For example, Google is already at work to use machine learning for predicting patients’ deaths, and the results boast a flattering figure of 95% accuracy, which is better than hospitals’ in-house warning systems,” says Behera. “AI application across clinical and non-clinical use cases will continue to show hard results and further bolster the growth in the healthcare space in 2019.”

AI-powered IT tools that manage payers’ and providers’ business risks (including clinical, operational, financial, and regulatory) continue to be important for the market, according to Behera. “Across all regions in the world, AI-based cognitive technologies are proving to be the most useful for medical imaging and clinical diagnostics—as a decision-support tool—followed by AI application to derive intelligence on remote patient monitoring data to promote outcomes-based personalized care.”

4. Regenerative medicine

Cell-gene therapy combinations are rapidly gaining momentum, which make use of gene-editing tools and vector delivery systems to devise innovative curative therapies, according to Behera.

“There is also a pipeline of induced pluripotent stem cells (IPSCs), mesenchymal stem cells (MSCs), and adipose-derived stem cells (ADSCs) for novel therapeutic treatments for neurological, musculoskeletal, and dermatological conditions, among others,” he says.

These are poised for growth because rising pressures to decrease healthcare cost globally, the emergence of value-based reimbursement models, and healthcare digitization trends are transitioning the treatment model from “one-size-fits-all” to stratified and outcomes-based targeted therapies, according to Behera.

“Many factors determine the rate at which the stem cell therapy market advances,” he says. “It is driven by the success of stem cell treatments in curing life-threatening diseases such as cancer, heart diseases and neuromuscular diseases in the world’s aging populations. Emerging gene-editing techniques such as CRISPR/Cas9 that offer high precision, accessibility, and scalability, compared to other genome editing methods, such as ZFNs and TALENs for cell and gene therapy applications will continue to attract high investment both from venture capital and pharma companies.”

As regenerative medicine is redefining medical technology synergies by combining stem cell technology with tissue engineering, market participants should be investing in innovative models such as risk sharing, in-licensing/out-licensing deals, fast-to-market models, and in-house expansions, according to Behera.

“With cell-therapy manufacturing being time sensitive, biopharma companies should implement IT-based solutions for improved manufacturing capabilities,” he says. “Despite the promises with novel cell and gene therapies such as CRISPR/Cas9, questions around ethical application challenge its future potential. This makes it necessary for the life science research executives to work closely with regulators in developing guidelines and regulations [that will] guide ethical and real-word unmet needs of the healthcare industry.”

5. Digital therapeutics

“Digital therapeutics are about to become a true medical alternative that will utilize communication-based technologies, apps, and software to improve patient outcomes and help to lower the cost of healthcare,” Behera says. “Digital therapeutics offer the benefit to improve patient outcomes and reduce treatment cost by replacing the need for a drug or augmenting a standard of care, but they are not endorsed by a regulatory body, such as the FDA.”

Frost & Sullivan projects that the overall digital therapeutics market is to grow at a CAGR of 30.7% from 2017 to 2023.

“Digital therapeutics will become an exciting healthcare option that adds a curative dimension to technology,” he says. “As care for these chronic diseases expands in scope, prevention and recovery are becoming the new focus areas—apart from diagnosis and treatment. This demands a holistic view of individual health, lifestyle, and environmental data beyond the clinical health records to efficiently stratify at-risk patients for a preventive and targeted treatment paradigm.” 

Defining digital therapeutics appears at first glance to be a simple task, but challenges develop when attempting to define digital therapeutics as a market opportunity, according to Behera.

“Healthcare executives exploring the growth opportunities should prioritize their market positioning, which is often dictated by focused use cases (e.g., condition management vs. behavior management) rather than the technology novelty,” he says. “At present, many companies are either claiming to be or cited in the media as digital therapeutics, but only a small number of early-stage participants are seeking FDA certification based on randomized clinical trials. They make it critical for healthcare executives to keep a close watch on progressing regulatory developments, such as the FDA precertification program.”




Patient Perception of Hospital Affiliations Influences Care

Hospital affiliation and healthcare mergers

About 85 percent of individuals said they would forgo local care and travel one hour based on hospital affiliation with a top-ranked system, a study reveals.

Hospital affiliations can influence patient volume, a new study by the Yale Cancer Center shows.

The study recently published in the journal Annals of Surgical Oncology revealed that 85 percent of individuals about to receive complex cancer surgery would travel one hour away to receive care at a top-ranked hospital specializing in cancer care. The respondents said they would travel to a top-ranked affiliated hospital rather than go to their local hospital.

However, almost one-third of the respondents (31 percent) would change their mind about where to seek care if their local hospital was affiliated with a top-ranked hospital or system.

Researchers at Yale Cancer Center explained that the trend in where patients seek care indicated that individuals believe that hospital affiliation with top-rank hospitals means that both hospitals – the top-ranked and affiliate organizations – offer similar quality care. And about one-half of the 1,000 individuals surveyed said that safety and quality of care were identical at both the top=ranked and affiliate hospitals.

But the perception that top-ranked hospitals and their affiliates offer the same level of care quality is not necessarily true, researchers warned.

“There is no evidence that the care is the same, and no regulation that governs the advertising and marketing of these affiliations,” explained the study’s senior author, Daniel J. Boffa, MD, professor of surgery (thoracic surgery), program leader of the Thoracic Oncology Program at Smilow Cancer Hospital at Yale Cancer Center, and investigator at Yale’s Cancer Outcomes, Public Policy, and Effectiveness Research Center (COPPER).

Boffa and his colleagues further investigated how brand-sharing, like hospital affiliations, via the internet impact an individual’s healthcare decision-making process. Researchers asked the over 1,000 individuals about their hospital preferences for complex cancer surgery between large top-ranked organizations and small, local hospitals.

When researchers asked the respondents to compare top-ranked and small hospitals, the survey showed:

  • 47 percent of respondents said that surgical safety, 66 percent felt that guideline compliance, and 53 percent reported cure rates would be the same at both hospitals
  • 47 percent of respondents thought that the surgical care at a top-ranked hospital and its affiliates would be the same across all four safety features (rate of complications, readmissions rate, length of stay, and postoperative mortality rate)
  • 44 percent of respondents thought the affiliated hospital would be the same in terms of surgical quality standards, including surgical cure rate

“It is completely understandable that the public would make assumptions that hospitals advertising the same name offer the same care,” Boffa stated in a press release. “Some hospital advertising could be even be interpreted as encouraging this line of thinking.”

“The truth is that we do not yet know if care received at an affiliated hospital is the same as care at the brand name center, whether that is for complex cancer care or other procedures,” he continued. “Currently hospitals are free to share their brand with almost any hospital they choose. The hospitals are not required to inform patients of any differences in the quality or safety of care provided by the different hospitals within a network. This study suggests that the public is making assumptions in care equality that are potentially influencing their choice for hospital care.”

The perception about hospital affiliations could be problematic for the healthcare industry as providers rapidly consolidate.

Healthcare organizations announced 115 merger and acquisition transactions in 2017, consulting firm Kaufman Hall reported. And that was the highest number of transactions in recent history, the firm pointed out.

2018 is likely to meet or even exceed the number of healthcare mergers and acquisitions, healthcare experts predict. For example, recent data from Kaufman Hall show 255 healthcare merger and acquisition deals announced in the second quarter of 2018.

Many leaders of healthcare organizations engaging in a merger and/or acquisition claim the deal will improve care quality while lowering costs for patients.

But Boffa et al. pointed out that care quality may not necessarily be the same across affiliate hospitals, creating confusion among individuals seeking high-quality, low-cost care.

“I see these findings as a wake-up call to the medical community to investigate if there are important differences in care between affiliated hospitals and their mother ship, as well as a wake-up call to name brand medical centers to take ownership for outcomes at hospitals that share their names,” Boffa stated.

“What is known is that the issue of where to receive complex cancer care is seen as crucial to patient outcome,” he added. “Studies have found that the quality and safety of such complex cancer care is particularly prone to outcome variability across hospitals, and the risk of dying after an operation can be up to four times greater at hospitals that perform procedures infrequently. Yet other data suggests that, in general, outcomes at top-ranked hospitals can vary widely, and are not always superior to non-ranked hospitals.”

Hospital affiliations, however, do have the potential to increase patient access to high quality care, the researchers elaborated. But stakeholders need to provide patients with quality of care data to help them make informed healthcare decisions.

“To our knowledge, this is the first survey to focus on the difference in the public’s perception of care between these two environments, but it is likely that affiliation status and co-branding has already impacted the distribution of patients across the healthcare spectrum,” Boffa said. “The development of affiliations could, potentially, bring cancer expertise closer to patients— but without facts that is just a theory.”


What goes into a CFO’s dashboard for artificial intelligence and machine learning

Artificial intelligence and machine learning can be leveraged to improve healthcare outcomes and costs — here’s how to monitor AI.

The use of artificial intelligence in healthcare is still nascent in some respects. Machine learning shows potential to leverage AI algorithms in a way that can improve clinical quality and even financial performance, but the data picture in healthcare is pretty complex. Crafting an effective AI dashboard can be daunting for the uninitiated.

A balance needs to be struck: Harnessing myriad and complex data sets while keeping your goals, inputs and outputs as simple and focused as possible. It’s about more than just having the right software in place. It’s about knowing what to do with it, and knowing what to feed into it in order to achieve the desired result.

In other words, you can have the best, most detailed map in the world, but it doesn’t matter if you don’t have a compass.


Jvion Chief Product Officer John Showalter, MD, said the most important thing an AI dashboard can do is drive action. That means simplifying the outputs, so perhaps two of the components involved are AI components, and the rest is information an organization would need to make a decision.

He’s also a proponent of color coding or iconography to simplify large amounts of information — basic measures that allow people to understand the information very quickly.

“And then to get to actionability, you need to integrate data into the workflow, and you should probably have single sign-on activity to reduce the login burden, so you can quickly look up the information when you need it without going through 40 steps.”

According to Eldon Richards, chief technology officer at Recondo Technology, there have been a number of breakthroughs in AI over the years, such that machine learning and deep learning are often matching, and sometimes exceeding, human capability for certain tasks.

What that means is that dashboards and related software are able to automate things that, as of a few years ago, weren’t feasible with a machine — things like radiology, or diagnosing certain types of cancer.

“When dealing with AI today, that mostly means machine learning. The data vendor trains the model on your needs to match the data you’re going to feed into the system in order to get a correct answer,” Richards said. “An example would be if the vendor trained the model on hospitals that are not like my hospital, and payers unlike who I deal with. They could produce very inaccurate numbers. It won’t work for me.”

A health system would also want to pay close attention to the ways in which AI can fail. The technology can still be a bit fuzzy at times.

“Sometimes it’s not going to be 100 percent accurate,” said Richards. “Humans wouldn’t be either, but it’s the way they fail. AI can fail in ways that are more problematic — for example, if I’m trying to predict cancer, and the algorithm says the patient is clean when they’re not, or it might be cancer when it’s not. In terms of the dashboard, you want to categorize those types of values on data up front, and track those very closely.”


Generally speaking, you want a key performance indicator based around effectiveness. You want a KPI around usage. And you want some kind of KPI that tracks efficiency — Is this saving us time? Are we getting the most bang for the buck?

The revenue cycle offers a relevant example, where the dashboard can be trained to look at something like denials. KPIs that track the efficiency of denials, and the total denials resolved with a positive outcome, can help health systems determine what percentage of the denials were fixed, and how many they got paid for. This essentially tracks the time, effort, and ultimately the efficacy of the AI.

“You start with your biggest needs,” said Showalter. “You talk about sharing outcomes — what are we all working toward, what can we all agree on?”

“Take falls as an example,” Showalter added. “The physician maybe will care about the biggest number of falls, and the revenue cycle guy will care about that and the cost associated with those falls. And maybe the doctors and nurses are less concerned about the costs, but everybody’s concerned about the falls, so that becomes your starting point. Everyone’s focused on the main outcome, and then the sub-outcomes depend on the role.”

It’s that focus on specific outcomes that can truly drive the efficacy of AI and machine learning. Dr. Clemens Suter-Crazzolara, vice president of product management for health and precision medicine at SAP, said it’s helpful to parse data into what he called limited-scope “chunks” — distinct processes a provider would like to tackle with the help of artificial intelligence.

Say a hospital’s focus is preventing antibiotic resistance. “What you then start doing,” said Suter-Crazzolara, “is you say, ‘I have these patients in the hospital. Let’s say there’s a small-scale epidemic. Can I start collecting that data and put that in an AI methodology to make a prediction for the future?’ And then you determine, ‘What is my KPI to measure this?’

“By working on a very distinct scenario, you then have to put in the KPIs,” he said.

PeriGen CEO Matthew Sappern said a good litmus test for whether a health system is integrating AI an an effective way is whether it can be proven that its outcomes are as good as those of an expert. Studies that show the system can generate the same answers as a panel of experts can go a long way toward helping adoption.

The reason that’s so important, he said, is that the accuracy of the tools can be all over the place. The engine is only as good as the data you put into it, and the more data, the better. That’s where electronic health records have been a boon; they’ve generated a huge amount of data.

Even then, though, there can be inconsistencies, and so some kind of human touch is always needed.

“At any given time, something is going on,” said Sappern. “To assume people are going to document in 30-second increments is kind of crazy. So a lot of times nurses and doctors go back and try to recreate what’s on the charts as best they can.

“The problem is that when you go back and do chart reviews, you see things that are impossible. As you curate this data, you really need to have an expert. You need one or two very well-seasoned physicians or radiologists to look for these things that are obviously not possible. You’d be surprised at the amount of unlikely information that exists in EMRs these days.”

Having the right team in place is essential, all the more so because of one of the big misunderstandings around AI: That you can simply dump a bunch of data into a dashboard, press a button, and come back later to see all of its findings. In reality, data curation is painstaking work.

“Machine learning is really well suited to specific challenges,” said Sappern. “It’s got great pattern recognition, but as you are trying to perform tasks that require a lot of reasoning or a lot of empathy, currently AI is not really great at that.

“Whenever we walk into a clinical setting, a nurse or a number of nurses will raise their hands and say, ‘Are you telling me this machine can predict the risk of stroke better than I can?’ And the immediate answer is absolutely not. Every single second the patient is in bed, we will persistently look out for those patterns.”

Another area in which a human touch is needed is in the area of radiological image interpretation. The holy grail, said Suter-Crazzolara, would be to have a supercomputer into which one could feed an x-ray from a cancer patient, and which would then identify the type of cancer present and what the next steps should be.

“The trouble is,” said Suter-Crazzolara, “there’s often a lack of annotated data. You need training sets with thousands of prostate cancer types on these images. The doctor has to sit down with the images and identify exactly what the tumors look like in those pictures. That is very, very hard to achieve.

“Once you have that well-defined, then you can use machine learning and create an algorithm that can do the work. You have to be very, very secure in the experimental setup.”


It’s possible for machine learning to continue to learn the more an organization uses the system, said Richards. Typically, the AI dashboard would provide an answer back to the user, and the user would note anything that’s not quite accurate and correct it, which provides feedback for the software to improve going forward. Richards recommends a dashboard that shows failure rate trends; if it’s doing its job, the failure rate should improve over time.

“AI is a means to an end,” he said. “Stepping back a little bit, if I’m designing a dashboard I might also map out what functions I would apply AI to, and what the coverage looks like. Maybe a heat map showing how I’m doing in cost per transaction.”

Suter-Crazzolara sees these dashboards as the key to creating an intelligent enterprise because it allows providers to innovate and look at data in new ways, which can aid everything from the diagnosis of dementia to detecting fraud and cutting down on supply chain waste.

“AI is at a stage that is very opportune,” he said, “because artificial intelligence and machine learning have been around for a long time, but at the moment we are in this era of big data, so every patient is associated with a huge amount of data. We can unlock this big data much better than in the past because we can create a digital platform that makes it possible to connect and unlock the data, and collaborate on the data. At the moment, you can build very exciting algorithms on top of the data to make sense of that information.”


If a health system decides to tap a vendor to handle its AI and machine learning needs, there are certain things to keep in mind. Typically, vendors will already have models created from certain data sets, which allows the software to perform a function that was learned from that data. If a vendor trained a model with a hospital whose characteristic differ from your own, there can be big differences in the efficacy of those models.

Richards suggested reviewing what data the vendor used to train its model, and to discuss with them how much data they need in order to construct a model with the utmost accuracy. He suggests talking to vendor to understand how well they know your particular space.

“In most cases I think they’ve got a good handle on the technology itself, but they need to know the space and the nuances of it,” said Richards. He would interview them to make sure he was comfortable with their depth of knowledge.

That will ensure the technology works as effectively as possible — an important consideration, since AI likely isn’t going away anytime soon.

“We’re seeing not just the hype, but we’re definitely seeing some valuable results coming,” said Richards. “We’re still somewhat at the beginning of that. Breakthroughs in the space are happening every day.”

Nursing home study raises questions on Medicare managed care networks

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Managed care is the hot trend in Medicare, with the number of seniors enrolled in Medicare Advantage plans projected to soar over the coming decade.

These plans offer simplicity by combining all the different parts of Medicare into a single buying decision – and they can save you money.

But before you sign up, ask this question: What happens if I get really sick?

Most Medicare Advantage plans are HMOs or PPOs. When you join, Medicare provides a fixed payment to the plan to cover Part A (hospitalization) and Part B (outpatient services). Advantage is growing quickly, fueled by its value proposition of savings and simplicity – the plans bundle together prescription drug coverage and the out-of-pocket protection of Medigap plans.

But like any type of managed care coverage, there is a trade-off: you must use in-network healthcare providers. For example, one recent study found shortcomings in the quality of providers in some Medicare Advantage provider networks – one out of every five plans did not include a regional academic medical center – institutions that usually offer the highest-quality care and specialists (

Now, a new study raises questions about the quality of skilled nursing facilities (SNFs) that are included in Medicare Advantage provider networks.

Researchers at Brown University’s School of Public Health examined Medicare beneficiaries entering skilled nursing facilities (SNFs) from 2012 to 2014. The yardsticks for quality were Nursing Home Compare – Medicare’s own database of nursing home quality ratings – and rates of hospital readmission for those admitted to SNFs. Their key finding: Medicare Advantage enrollees appear more likely to enter lower-quality skilled nursing facilities than people enrolled in traditional fee-for-service Medicare.

Medicare Advantage plans also are subject to a quality rating system, but the researchers found that enrollees in both lower- and higher-quality plans were admitted to SNFs with significantly lower quality ratings.

The SNF quality gaps could impact a large group of people, considering the large – and growing – Medicare population. David Meyers, one of the Brown University study authors, calculates that about 315,000 patients from lower-rated Advantage plans need to use an SNF annually. “If those people had used fee-for-service Medicare, up to 13,000 more of them might have gone to a higher-quality nursing home,” he said.


The study does not conclude that healthcare outcomes are necessarily worse for Medicare Advantage enrollees – that was outside the scope of the research. Some researchers have correlated NHC star ratings with patient outcomes, but the jury really is out on this question – partly because of the shortcomings of NHC itself. Much of the data that determines ratings is self-reported by nursing homes, and reviews of this system have found numerous cases of facilities attempting to “game” the system to inflate their ratings.

A large trade group representing the private companies that sponsor Advantage plans – America’s Health Insurance Plans (AHIP) – argues that actual outcomes are better. The group points to another study that found MA enrollees had shorter lengths of stay and were less likely to be readmitted to a hospital and more likely to return home within 90 days of admission than FFS beneficiaries.

But the Brown researchers found that patients from lower-rated Advantage plans tended to go to SNFs with higher readmission rates than fee-for-service patients.

And a review by the Kaiser Family Foundation in 2014 of a large body of research comparing the quality of care provided by Advantage plans and traditional Medicare concluded that the available research is unsatisfying, and that better evidence is needed.

Even if current research is inconclusive, this much is clear: we need much greater transparency to help consumers understand at the point when they are shopping for Medicare Advantage plans using the online Medicare plan finder  ( “It’s not very clear what SNFs are part of any given Advantage plan,” said Meyers.

Going beyond information in the plan finder also presents challenges, said Tricia Neuman, senior vice president and director of the program on Medicare policy at Kaiser. “You would need to get the provider directory from every Advantage plan she is considering – and those are not available in a uniform format,” she said.

”Then, you’d have to go compare the different nursing home providers online for their quality ratings.”  No one – including AHIP – is even tracking data on how many SNFs are offered by the typical Advantage plan.

Meyers doubts that even a good research tool would help. “Most people don’t think about a nursing facility until they need one  – and it’s really difficult to make decisions about this at a time of crisis,” he said.

Gaining a better understanding of quality in Medicare Advantage plans is going to be urgent as the aging of the nation accelerates. Overall Medicare enrollment will jump nearly 30 percent by 2027 according to projections by the Congressional Budget Office. And Advantage plan enrollment will increase from 19 million to 31 million, which would represent 44 percent of eligible Medicare beneficiaries.

And the need for greater consumer vigilance in choosing SNFs will increase as the Trump administration moves aggressively to deregulate the industry.


How One U.S. Clinic Disrupted Primary Care, Made Patients Healthier And Still Failed

Turntable Health launched in Las Vegas in 2013 and looked to turn the traditional primary care model on its head.

Zubin Damania has a face for television, a mind for medicine and the sort of fearless personality required to be one of the internet’s most famous MDs.

Damania’s celebrity began in earnest not long after someone posted a clip from his 1999 UCSF Medical School commencement address. In his opening, Damania jokes that he’s on a “time delay,” given his reputation as a “loose cannon.” The rest of the clip, which has been viewed over 130,000 times on YouTube, takes you briefly inside the mind of a versatile entertainer and healthcare visionary.

From UCSF, Damania completed his internal medicine residency at Stanford University. He spent the next 10 years as a practicing hospitalist by day and a healthcare satirist by night – writing, performing and filming musical parodies about the frustrations of being a doctor. He’s best known today by his online persona, ZDoggMD, and for his nightly Facebook show, covering the latest medical news with his trademark wit.

The rise and fall of Turntable Health

In 2013, CEO Tony Hsieh asked Damania to launch a next-generation medical clinic in Las Vegas as part of a $350 million downtown revitalization project. Founded as a primary care practice, Turntable Health looked to turn healthcare delivery on its head.

Inside a waiting room that resembled a sleek Silicon Valley startup, Turntable members passed the time by spinning records, playing Xbox and practicing yoga. As part of their membership, patients had access to an entire “wellness ecosystem,” complete with same-day visits, 24/7 doctor access (by email, phone or video), along with a dedicated health coach. Doctors at the clinic spent 45 minutes or more with their patients, quite unlike the 13 to 16-minute visits that have become standard in U.S. doctors’ offices.

Damania credits the vision for his clinic to a partnership he forged with Rushika Fernandopulle, CEO of another innovative primary-care organization called Iora Health. With Fernandopulle’s guidance, Damania focused on population health and disease prevention to improve patient wellness and, over time, lower costs. And rather than charging for each visit, test or procedure, Turntable patients who were not covered by traditional insurance paid a flat fee of $80 a month.

Unlike any other primary care clinic in Las Vegas, Turntable Health was a success, medically. By emphasizing prevention and doctor-patient relationships, Damania’s practice achieved superior quality outcomes, while providing rapid access to care and high patient satisfaction. But from an economic perspective, the clinic was a bust. Insurers shied away from member fees, insisting on more traditional reimbursements, which directly contradicted Damania’s long-term health strategy. Turntable Health was forced to close its doors in January 2017, just three years after opening.

In a public statement, Damania explained: “We flatly refused to compromise when pressured by payers to offer fee-for-service options, or to begin charging a co-pay. We firmly believe that healthcare is a relationship, not a transaction.”

Unfortunately for Damania, most health insurers are too impatient. Investing in primary care and chronic-disease management is proven to reduce and even avoid medical problems. But it can take five to 10 years for the improvements in the health of patients to offset the added upfront costs of providing the necessary care. Health plans worry patients will switch insurers before they can recoup such a long-term investment.

Primary care doctors can and do play a critical role in preventing disease, spurring lifestyle changes and warding off complications from chronic illness, when they have the time to do so. Today’s fee-for-service payment system doesn’t adequately reward these efforts.

Today’s insurers are systematically reducing primary care reimbursements, forcing doctors to see 20 to 30 patients a day while spending the bulk of their time in front of a computer, entering patient data for billing purposes. This backward approach to care delivery is wreaking havoc on the nation’s health and economy. As the incidence of chronic disease grows, the cost of American healthcare continues to rise more rapidly than the nation’s ability to pay.

The closure of Turntable Health was a major loss for Las Vegas, where residents joke that the best place to go for healthcare is the airport. Compared to people with access to integrated and coordinated medical care programs, Las Vegans are less likely to be insured, get the recommended cancer screenings and receive other necessary preventive care interventions.

Pushing primary care: Iora Health and One Medical

Damania’s partner in primary care, Iora Health, is experiencing relative success nationally, with 30+ clinics in 11 metropolitan areas. Using the same model of patient engagement and prevention that Turntable adopted, Iora has shown 35% to 40% drops in hospitalizations compared to their community peers, with 12% to 15% lower total healthcare costs. They’ve also established contracts with insurance companies who are willing to invest in primary care, thus solving one of ZDogg’s biggest challenges.

And they’re not alone. One of Iora’s leading competitors, One Medical, operates out of San Francisco under the leadership of Dr. Tom Lee. Labeled by some as a “concierge” medical practice, the company’s network includes 250+ doctors in 40 cities coast to coast. One Medical offers patients the ability to schedule same-day appointments, access their health records online, and fill prescriptions using the One Medical app – all for a relatively affordable yearly fee of about $149. With a promise that “your care is our highest priority,” the company makes the primary care experience more convenient and user friendly, a mission that’s been paying off since 2007. One Medical’s subscriber base continues to grow by tens of thousands of patients each year, particularly within the tech industry.

Although these extremely well-run primary care systems have improved outpatient quality and patient satisfaction, their impact on overall healthcare costs remains minimal. If Americans want to make healthcare affordable again, the scope and pace of change will need to accelerate at every point of care. This will require innovative approaches that rein in the rapidly escalating costs of specialty and hospital care, where most added national healthcare expenditures (NHE) exist.