PwC’s Health Research Institute (HRI) projects U.S. medical inflation will dip to 6.5 percent in 2016, capping a 10-year trend of slowing employer medical cost-trend growth in the employer-sponsored market. In the latest installment of its annual report Medical Cost Trend: Behind the Numbers, HRI identifies three factors that are expected to reduce the medical growth rate in 2016:
The Affordable Care Act’s looming “Cadillac tax” on high-priced plans which is accelerating cost-shifting from employers to employees to reduce costs;
Greater adoption of “virtual care” technology that can be more efficient and convenient than traditional medical care; and
New health advisers helping to steer consumers to more efficient healthcare.
Despite the year-over-year slowdown, HRI also reported that medical inflation still outpaces general inflation, underscoring the challenges ahead for the health industry. In fact, Behind the Numbers identified two factors that will likely exert inflationary pressure on health spending in the year ahead:
New specialty drugs entering the market in 2015 and 2016 will continue to push health spending growth upward; and
Major cyber-security breaches are forcing health companies to step up investments to guard personal health data, adding to the overall cost of delivering care.
“While the health industry has improved in efficiency over the past decade, the slowing employer medical cost growth is because of the increased role of savvy health consumers facing higher cost-sharing responsibilities and more complex decisions,” said Kelly Barnes, PwC’s U.S. health industries leader. “This will continue to impact the New Health Economy in the coming years.”
From relieving people of repetitive tasks, to building everything around us that shapes our lifestyle, and on to transformation of volumes of data into new insights and perspectives, software has become the new feedstock for the human evolution. All facets of life are touched by software, and healthcare is no exception.
The Complex Web of Health Industry
The health and social care industry is a highly fragmented and complex industry with medical practitioners, nurses, health professionals, hospitals, clinics, government, and non-government agencies all providing health services.
Martin Callinan
The spectrum of healthcare providers range from individual clinicians such as general practitioners to large monolithic entities, such as the National Health Service in the UK, which is the third largest employer in the world today.
Health and social care providers offer a complex and diverse range of facilities and services. By the nature of these services, the healthcare industry is driven by large and varied amounts of data which in turn require varied and complex IT systems to manage this data. Generally, these systems come under the umbrella term of eHealth. While there is no consensus on the exact definition of eHealth, two example definitions are:
“…the cost-effective and secure use of information and communication technologies in support of the health and health-related fields including healthcare, health surveillance and health education, knowledge and research.” –The World Health Organization (WHO)
“…the use of modern information and communication technologies to meet needs of citizens, patients, healthcare professionals, healthcare providers, as well as policy makers.” –The European Commission
Whatever way people choose to define eHealth, it generally encompasses:
Guest post by Deanne Primozic Kasim, research director, payer health IT, IDC Health Insights.
Who will be the next big health plan to merge with and/or acquire Humana? This has been the topic of a lot of industry conversation and I have actually thought about starting an online betting pool. In lieu of creating a “bracket challenge,” I have been informally asking opinions on this topic and the results are all over the map. A deal for either Humana, valued at $27 billion, or Medicaid provider Centene Corp., at $8.3 billion, would be the biggest acquisition of a U.S. payer in more than a decade. It’s an exciting time this summer with the upcoming Supreme Court decision on the legality of insurance subsidies on the federal marketplace, and an anticipated consolidation between Humana and another large insurer.
Why will health plan consolidation continue? Two major reasons:
Increasing Medicare and Medicaid memberships
According to the Centers for Medicare and Medicaid Services (CMS), Medicare membership is expected to reach 68.4 million in 2023, up from a projected 54.4 million this year. In addition, Medicaid will add 9.3 million people over the same period. Baby boomers are hitting Medicare eligibility at a rate approaching 10,000 per day. Part of the reason companies like Humana and Centene are attractive acquisitions to other payers is because of the size of their Medicare and Medicaid memberships. It is important to note that regardless of how mergers and/or acquisitions play out, payers with multiple lines of government-sponsored business will need effective processes and related IT tools for understanding the complex demographics and health needs of these members. Many Medicare and Medicaid members are high-risk/high-value patients who have clinical and non-clinical factors that can result in the development of costly and complex conditions.
Here are some selected FAQs about telehealth service delivery that focus most particularly on the home healthcare arena, which is most probably the health service sector most unaffected by new technology introduction and use until recent decades. Strictly hands-on, or ‘high touch” care service delivery was the order of the day throughout the 20th century. Yet home healthcare is likely to become a very critical component for achieving the much broader and longer term view of patient care delivery after patients’ discharge from hospital. It is then and at home that patients will receive subsequent services through their continuum of care that will keep them well over a long term.
Can I get reimbursed for providing telehealth?
The answer is yes, usually, for providing home telehealth services but not in the usual billing scenarios most home healthcare organizations are used to for submitting bills to Medicare or other insurers. As of now, mid-2015, changes in Medicare and Medicaid fee for services are just coming on-board affecting home telehealth service delivery. There is still a long way to go until Medicare will not very much require face-to-face home healthcare visits during a patient’s admission period—this is the same insurer who absolutely required specific documentation about every portion of nurses’ contact with patients and let the home health agencies (HHAs) know that to CMS, if something was not documented [e.g., a telephone call between nurse and patient about wellness directives] , it didn’t happen [and the bill would therefore not be paid]. Today there are many insurers beyond Medicare that are paying for home telehealthcare (e.g., Aetna, United Healthcare), but it’s very early on—we need to return to this question later this year.
How will I develop a home telehealth service capability? How will I develop a strategic and operating plan for this new delivery channel? Where will I get the technology? What type of training will be required of my people and what will the cost of training be and how many employee hours need to be dedicated to this training?
It’s best to keep in mind that, although the technology is new, you’re not beginning with a blank slate for running a healthcare service delivery business. While all of these questions about telehealth tool acquisition and use are important, the very first question to ask, not mentioned in this list of questions is, hands down, who are my HHA’s most costly patients? An agency-wide chart review would reveal that these are the patients that require the most visits, and additional training in self-management skills and routines.
Once identified, and these are usually patients living with specific chronic diseases and conditions, such as congestive heart failure (CHF) and non-healing wounds, then the subsequent questions can be addressed. In earlier days of home telehealth service delivery (ca. mid-1990s), a full-scale workstation was typically available that could be assigned to any home healthcare patient and came fitted with telecommunications-ready vital sign measuring peripheral devices such as a blood pressure cuff and pulse oximeter, as well as glucometer for measuring diabetic patients’ blood sugar levels even though some patients didn’t have diabetes. These were kind of a one-size-fits-all system, though these proved to be too costly for HHAs and too complicated for patients to use regularly and correctly. More common now is to order and assign only needed and stand-alone telecommunications-ready peripherals devices for patients to perform daily measurements and transmit them to their clinicians.
Brent D. Lang has served as the president and chief executive officer, and a board member, of Vocera since June 2013. Since joining the company in 2001, Lang has played a role in transforming Vocera from a startup to a publicly traded corporation with more than 380 employees and revenues exceeding $100 million.
Prior to being named CEO, he was the company’s president and chief operating officer and a member of the team that led Vocera’s successful IPO in March 2012. During his tenure with Vocera, he also has served as the company’s vice president of marketing and business development for more than five years, spearheading the initial business plan and the development of product and go-to market strategies.
Before joining Vocera, Lang was the senior director of marketing at 3Com Corporation, and was a strategy consultant for Monitor Company, advising Fortune 500 companies. He graduated summa cum laude from the University of Michigan with a bachelor’s degree in industrial and operational engineering before earning an MBA from Stanford University Graduate School of Business. While at the University of Michigan, he was a member of the 1988 U.S. Olympic Swimming Team and won a Gold Medal in the 4×100 freestyle relay at the summer Olympics in Seoul, South Korea.
Here, he discusses Vocera’s mission; how the company serves the healthcare market; how health reforms are impacting businesses; making healthcare communications more efficient; and his vision for the future.
Describe how your background gave you the tools to start/run a communications technology company like Vocera.
In retrospect, my background is a perfect fit for Vocera. First, my industrial engineering degree helped me understand process workflows and how to apply the right technologies to human collaboration and communication challenges, which was a natural link to the problems Vocera looks to address. My technology background helps me understand what we’d need to do with the Vocera products, and the workflow aspect helps me understand our customers’ challenges.
I (worked) at Monitor Company, a strategy consulting firm, which provided me with formal training in understanding customer requirements and defining markets and product strategy. After that, I attended Stanford University to get my MBA, which was focused on entrepreneurship and strategy. I then worked at 3Com, which provided solid knowledge of the networking and wireless space – all of which has proved immensely valuable in helping to grow Vocera.
My athletic background as an Olympic swimmer has also played a big role in my development. Growing and running a company takes hard work and determination – most startups are not primed for immediate success – and as a competitive athlete you learn that there are no shortcuts to the top; you have to put in time and effort over many years to reach your peak. Many professionals focus on the end point of where they will take their business, but the thousands of hours you put in are what drive you to that point – so there is a strong correlation between competing in sports and succeeding in business.
Tell me about Vocera. What does it do and who does it serve, specifically?
Vocera delivers integrated, intelligent, secure communication solutions that enable the flow of information from one care provider to another in real-time, and allows them to act on that information at the point of care, throughout their entire healthcare experience. Our range of solutions allows care professionals to instantly connect patients with the care and resources they need, helping prevent treatment delays and increasing operational efficiency throughout the hospital.
Interoperability standardization is a critical element of e-health innovation. Varied and complimentary standards will be needed in the decades ahead to accelerate development of life-saving and life-enhancing capabilities and to ensure that the greatest potential benefits of e-health are realized around the world.
The IEEE Standards Association is at the tip of this spear and is working to make progress in the field of medical device interoperability. Illustrating the benefit of interoperability of standards in the monitoring and assessment of patients, and creating awareness of current medical device standards, this following infographic gives a short description of six medical device standards that strive to improve medical treatment for both patients and providers.
Utilizing smart phones, people can track and send their data to doctors from a variety of personal health devices such as, sleep monitors, insulin pumps, sleep apnea equipment, health and fitness monitors, health weighing scales and glucose meters. The standards specify the use of specific term codes, formats and behaviors in telehealth environments that promote interoperability of multi-vendor products to create an over-all more seamless tracking of health.
If you’ve ever watched a person go through the first stages of coping with type 2 diabetes – and with the disease at epidemic levels, many of us have a close friend or relative with the disease – you’ve seen them struggle to put into practice all the information, advice and strategies they are given.
This is true of most people with newly diagnosed chronic diseases, not just diabetes. To avoid complications, and the huge costs in both suffering and money that come with them, they have to learn a new way of living. Medication and other treatments can’t take the place of lifestyle changes. And despite their best efforts, many people are defeated by the challenge.
We now spend 70 percent of our healthcare dollars on chronic disease care, much of it to treat complications that lifestyle changes could avert. All that money isn’t really helping. People continue to suffer and to lose years of productive life. If we could find a way to help these people improve their health, we could dramatically reduce both suffering and costs.
Chronic disease patients need tech support
One thing we’ve learned here at Dell is that in helping hospitals implement an electronic health record (EMR), at-the-elbow tech support makes a big difference. And learning to use a new EMR has many of the same challenges as learning to live with diabetes.
To go live with a new EMR, doctors and nurses have to learn a new way of working. It’s more than just a software change. It’s changing everyday habits that have kept the operation running for years. That’s why it is crucial to have someone to guide the caregivers through the first days and weeks. The right support lowers users’ frustration, increases their confidence and makes the difference between a quick, smooth transition and a drawn-out, rocky transition.
That kind of tech support could also help patients with diabetes and other chronic diseases learn a new set of habits. For diabetics, even a simple thing like breakfast can be a challenge. If you can’t pick up your usual donut, what’s the alternative? Friendships can be harder. “No, sorry, I can’t go to happy hour for chips and a margarita,” isn’t what your friends want to hear. Add in blood sugar checks, medication and a new exercise routine, and it can be overwhelming. None of it is fun, and all of it distances you from friends and daily comforts.
Diabetes education classes can help, just as training classes for doctors and nurses can help them learn a new EMR. But patients also need the same at-the-elbow tech support for their new life that caregivers need for their new EMR. They need a knowledgeable, friendly healthcare tech support agent who can suggest a happy hour walk with your friends or what to drink instead of a sugar-loaded margarita. Or tell you about a healthy breakfast sandwich that is right on your way to work. Or how to tell your mom that you won’t be eating her famous pancakes at Sunday brunch. Someone to boost your confidence and make you feel like you can succeed at this new life.
New technology makes at-the-elbow support possible for patients
Sadly, most of patients are pretty much on their own. The result is confusion, loss of confidence and a sense that it is all just too hard. And that means expensive complications and more suffering.
The good news is that new telehealth technology can bring at-the-elbow support to patients at home, at a price that is affordable. While support can’t be literally at a patient’s elbow, secure video conferencing can give patients access to doctors, nurses and health coaches who can answer questions, give advice on medications, food, exercise and how to lose the unhealthy foods without losing the relationships that are tied to them. And most patients already have the technology needed – a smartphone, tablet or computer.
GenoSpace has built a comprehensive platform for genomic and other biomedical data. Its serves research, clinical development, pathology and clinical care customers who work with high-dimensional genomic and other biomedical data.
Elevator pitch
At GenoSpace, we are digital architects of genomic medicine. GenoSpace has built a comprehensive platform for precision medicine to enable interpretation, analysis, reporting and collaboration on high-dimensional genomic and other biomedical data. With specific applications supporting research, development, pathology and clinical care, many of the most advanced precision medicine organizations are powered by GenoSpace.
Product/service description
GenoSpace has built a comprehensive software platform for genomic medicine. The company leverages a single storage and security platform to deliver a variety of applications and services including reporting, population analytics, clinical trial matching, interactive physician and patient portals, and patient communities. GenoSpace specializes in data integration, modeling, analysis, interpretation, visualization and collaboration. GenoSpace applications serve users at laboratories, health systems, and organizations engaged in research and clinical development, as well as patients.
Founders’ story
John Quackenbush
GenoSpace was founded by John Quackenbush and Mick Correll in 2012 after they realized existing platforms for analyzing genomic information could be greatly improved. John is board chair and Mick is chief executive officer.
John received his PhD in theoretical physics from UCLA in 1990. Following a physics postdoc, he was awarded a 1992 NIH Special Emphasis Research Career Award to work on the Human Genome Project. After two years at the Salk Institute and two years at Stanford University, he moved to The Institute for Genomic Research, pioneering gene expression analysis. He joined the Dana-Farber Cancer Institute and Harvard School of Public Health in 2005 and works on reconstruction of gene networks that drive the development of disease. He received a 2013 White House Open Science Champion of Change award for his work on facilitating genomic data access.
Mick Correll
Mick’s more than 15-year career has tracked the path of genomics from basic research to clinical care. Over this time he has held leadership positions in academia and industry, and has developed informatics solutions for pharma/biotech R&D, ag-bio, and academic, government and community healthcare providers. Prior to launching GenoSpace, he and partner John Quackenbush established the Center for Cancer Computational Biology at the Dana-Farber Cancer Institute. Mick began his career at Lion Bioscience Research Inc. and UK-based informatics provider InforSense. Mick earned a BS in Computer Science and BA in Molecular Biology from the University of Colorado at Boulder.
Market opportunity (in your particular space–numbers, competitors, etc. are helpful)
The market for interpreting and analyzing molecular and other biomedical data is a multi-billion dollar component of the broader molecular diagnostics and applicable life science research markets—each of which represent tens of billions of dollars per year. GenoSpace’s target customers are innovators in lab medicine, hospitals and health systems, and research and clinical development organizations. While there are several competitors for individual offerings provided by GenoSpace, the company is unmatched in its cloud-based architecture, comprehensive suite of offerings and experience delivering those offerings to real customers.
PwC’s Health Research Institute (HRI) projects U.S. medical inflation will dip to 6.5 percent in 2016, capping a 10-year trend of slowing employer medical cost-trend growth in the employer-sponsored market. In the latest installment of its annual report Medical Cost Trend: Behind the Numbers, HRI identifies three factors that are expected to reduce the medical growth rate in 2016:
Interoperability standardization is a critical element of e-health innovation. Varied and complimentary standards will be needed in the decades ahead to accelerate development of life-saving and life-enhancing capabilities and to ensure that the greatest potential benefits of e-health are realized around the world.
