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Morning Headlines 1/7/16

January 7, 2016 Headlines No Comments

AT&T Just Announced a Major, New Health Care Venture

AT&T announces the opening of a health-focused innovation center called the AT&T Foundry for Connected Health. The new center will operate at the Textas Medical Center Innovation Institute in Houston.

HealthSpot shutters its telemedicine kiosk operations

Health IT startup HealthSpot, which sold telehealth kiosks outfitted with medical devices to health systems and retail locations, has shut down. The company had raised $28 million in VC funding since its 2010 launch, including $12 million in 2015.

Under Armour launches brand’s first suite of fitness-tracking products

Under Armour unveils UA HealthBox, a suite of devices that integrates with its digital health app including an activity tracker, a wireless scale, and a chest-strap heart rate monitor.

Death of man restrained at a D.C. hospital ruled a homicide

The death of a 74-year-old patient injured by security guards while trying to leave MedStar Washington Hospital Center without signing out has been ruled a homicide by the Washington DC medical examiner’s office.

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January 7, 2016 Headlines No Comments

CIO Unplugged 1/6/16

January 6, 2016 Ed Marx 14 Comments

The views and opinions expressed in this blog are mine personally and are not necessarily representative of current or former employers.

Course Corrections

The faculty at our Combat Engineer Officer School encouraged us to have leadership fortitude—the courage to make those tough decisions where you admit a mistake, take corrective action, and move forward. Some leaders today are unable to swallow their pride and publically admit an error. Damn if they will acknowledge a failure and make the needed corrections.

Our instructors told us the story of an engineer lieutenant who found himself unable to extract two of his platoons combat vehicles from the mud. He kept adding more dirt to the water. More dirt on water makes more mud. In exasperation, he gave up and just ordered his men to hide his error by burying the vehicles with dirt.

In due time, he was held accountable for the whereabouts of the vehicles and the story went viral. He never made captain.

Halfway in my tenure at a former employer, I was confronted by one of my directors. We had a very successful implementation of an EHR across our continuum that positively impacted business and clinical outcomes. We were getting our feet wet with mobile technologies and innovation was a part of our fabric. From the outside, everything appeared perfect. It wasn’t.

Operationally, we were coming apart. Unplanned downtime skyrocketed. One day, we were picking up an award, and the next, we were on 2:00 a.m. Level One severity calls. Something was wrong. Very wrong.

I was driving down the Interstate headed to an IT quarterly leadership retreat when I answered a call from Michael. “Ed, I don’t see how we can all be meeting for a full day talking strategy when we have had several months of early morning disaster calls. I think it is time to focus on operations.”

Reality! Michael was totally right. Upon arrival, I grabbed my direct reports and we huddled. I shared Michael’s call and that we needed to redirect our attention toward operations. We would need to be creative how to best use our time together that day.

As our leaders settled in and I stood to welcome everyone, I was overcome with emotion and began to tear up and finally started to cry. “I am so embarrassed. I have never been embarrassed like this. We have so much potential. We are gifted and blessed with resources. Yet we are letting our customers down. I have failed you and our organization as a leader.”

There was stunned silence. Then, one by one, the directors chimed in. Though they had remained silent for many months, everyone confided that they had the same thoughts. We had lost our focus, our sharpness. We took our eye off operations, pursued distractions, and relied on past success. As a result, our performance sunk.

We were all ashamed. With the confessions and emotions out of the way, we brainstormed how to get ourselves out of this mess. It was beautiful. The team self-directed, formed into groups, and each tackled the tough issues in a thoughtful manner.

After a couple of hours, each group reported on the results of their efforts. Participants responded and honed the recommendations. In the end, a director from each group took accountability for the initiative.

For the next few months, we focused on these action points. Sure enough, a year later, we were performing at levels commensurate with our potential. We were no longer embarrassed and were once again providing value and helping our health system achieve superior clinical and financial outcomes. Strategy was a natural byproduct.

Course corrections are a sign of strength, not weakness. If we are intellectually honest with ourselves, we know that corrections are required if we hope to continuously improve. This applies equally to work, play, and relationships.

As the New Year begins, take time to reflect on the past and see where you need to make directional changes. In 2015 I made two major corrections, one with work and one with relationships. They were both gut-wrenching, but necessary. As I head into 2016, I find myself in a much better place. At peace. Content. Giddy as a schoolboy.

Never settle for the status quo and flat performance. Humble yourself. Seek input. Change is good. Life is too short for mediocrity.

Ed encourages your interaction by clicking the comments link below. You can also connect with Ed directly on LinkedIn and Facebook and follow him on Twitter.

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January 6, 2016 Ed Marx 14 Comments

Readers Write: Industry Trends Impacting RCM in 2016

January 6, 2016 Readers Write 1 Comment

Industry Trends Impacting RCM in 2016
By Patrick Hall


Higher out-of-pocket costs, new reimbursements models, and rising operating costs are just a few of the trends that will impact provider revenue cycles in 2016. These industry developments will force providers to evaluate existing RCM strategies and possibly implement new technologies and workflows to simultaneously maintain financial health and address evolving consumer and regulatory demands.

Consider some of the more significant trends and their potential impact:

Higher out-of-pocket costs for patients

As the cost of insurance continues to rise, patients are shouldering higher out-of-pocket costs for deductibles and co-insurance. As a result:

  • Consumers are paying more attention to the cost of care and requesting greater price transparency prior to receiving services.
  • Providers need efficient tools to estimate a patient’s out-pocket-costs. This includes accurate eligibility and co-pay details, up-to-date information on a patient’s deductible status, and specifics on what services are included in a patient’s coverage.
  • Consumers may need help managing the cost of their care. Providers may require automation tools to facilitate any special payment arrangements.
  • Existing workflows may need to be altered. For example, in the past a practice may not have verified insurance information until the patient arrived in the office. Administrators may now elect to verify insurance details in advance of scheduled appointments and advise patients when a large out-of-pocket cost is anticipated.
  • Providers face greater financial risk. When patients struggle to pay for services, providers risk losing revenue and must dedicate additional resources for collection efforts.

Overhead costs are rising, but not necessarily reimbursements

In order to preserve financial health, providers must:

  • Remain diligent in controlling costs and managing the revenue cycle.
  • Consider technologies that automate RCM processes and increase efficiencies.
  • Make sure staff is well trained in order to maximize the benefits of technologies.

Provider reimbursement models are shifting from traditional fee-for-service to models that include incentives for the efficient delivery of quality outcomes

RCM is no longer as simple as sending out a claim after a patient office visit. Instead, providers must:

  • Be proactive in managing the health of their patients.
  • Implement workflows and technologies to help track patient outcomes.
  • Improve care coordination to minimize test duplication, manage costs, and enhance outcomes.
  • Prioritize efforts to collect patient payments at the point of care or in advance of procedures.

Meaningful Use and the transition to ICD-10 are less of a priority

Meaningful Use and ICD-10 have been top priorities for providers for the past several years. Today, however, most organizations have implemented certified EMRs and achieved some degree of Meaningful Use success, as well as made the transition to ICD-10. Providers now have more time and resources to address revenue cycle needs, possible platform upgrades, and the addition of apps to increase operational efficiencies.

In recent years, RCM has taken a back seat to competing priorities, but the changing healthcare landscape is forcing providers to evaluate existing strategies and technologies. This could be the year that RCM emerges from the shadows and perhaps into the spotlight.

Patrick Hall is EVP of business development for e-MDs.

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January 6, 2016 Readers Write 1 Comment

Readers Write: Why Do Digital Health Startups Need So Much VC Investment?

January 6, 2016 Readers Write No Comments

Why Do Digital Health Startups Need So Much VC Investment?
By Tom Furr


It is projected that by the end of 2015, $4.3 billion in funds will have been raised to bolster digital health startups. The first half of 2015 saw $2.1 billion invested in this area.

To clarify, a digital health company is one that could not exist without broadly available digital technology (like the Internet) and serves the healthcare market exclusively — pure plays. A company that publishes software and happens to have a health application in its portfolio is not considered a digital health company. Providers and partners are also not in this area – they are service organizations.

It’s been reported that digital health represents eight percent of all venture funding. However, there are many companies that have been in business for nearly 10 years that have raised more than $50 million but are not experiencing anything approaching “Google-like growth.”

Even someone who reads business news occasionally understands that mega-startups like Uber are raising huge amounts of money to build a legal war chest to contend with suits and regulatory pressures around the world. There must be an obvious reason for the continued big raises for the Ubers out there as well as digital health companies.

So why are we seeing such a robust funding for digital health outfits? Is it that digital health companies require large capital requirements to contend with regulatory challenges akin to what Uber faces? Is it that digital health companies are started by people from healthcare who don’t really understand how to build scalable technology solutions that have great usability? Is healthcare continuing to be an industry that lags in the adoption of new technology? Are consumers, when they’re the ultimate end-user, unaware or unimpressed with the new offerings?

What’s going on? Companies may be bulking up with funds so they can last through a long, slow adoption cycle or the twisted path to regulatory acceptance. However, here’s my take on these important questions.

Is it that digital health companies require large capital requirements to contend with regulatory challenges in the healthcare?

I suggest that most established, large healthcare IT companies have been built on government subsidies and regulations that force providers to purchase their products. In some cases, this is the only way some companies will be successful, in stark contrast to software companies that build a product that adds value to the customer instead of it being a requirement.

The ability to transition from being forced to purchase to wanting to purchase (based on recognized value) has clearly built up lots of apathy in the industry against change or innovative products. That is why healthcare is the last major industry to send so many paper statements as compared to all other sectors, including banking and financial services.

Is it that digital health companies are started by people from healthcare who don’t really understand how to build scalable technology solutions that have great usability?

In my examination of currently available products, none strike me as being user-friendly or innovative. Even Athenahealth – arguably one of the top established healthcare IT innovators in digital health history — says it’s time for an upgrade to usability for all products, including their own.

I come from the payments space, which has similar characteristics to healthcare with regards to its established companies. However, it has seen massive amounts of innovation from companies like Square that is shaking up the status quo by building a solution that is easy to get up and running, even by my young son, validating the importance of usability.

3. Is healthcare continuing to be an industry that always lags in the adoption of new technology?

I think most will agree that healthcare is at the back of the line when it comes to applying innovative technology to operations versus clinical settings like the latest heart procedure. I challenge any of the established players to say they’ve kept back-end systems or user interfaces fresh. At least Athenahealth’s Jonathan Bush is willing to call a spade a spade, which I respect.

No established player wants to see their company become a Yahoo (they did not value contextual ads like those served by Google) or an IBM (which did not value a PC operating system as Microsoft did) when life gets comfortable and profits are healthy, so they crush innovation.

4. Are consumers, when they’re the ultimate end user, unaware or unimpressed with the new offerings?

If you look at any number of healthcare-related portals, it appears that usability was the last thing in mind when they were created. In fact, if it were not for Meaningful Use, would any of those vendors have even created portals? This gets back to my second point — that any new company is going to have to spend substantial amounts of money to educate patients on the value of their offering. In all likelihood, the same thing has to do be done with provider solutions.

So we’re clear, I am not advancing a radical change in the way the healthcare market behaves. It is an industry whose product is positive outcomes for people with, or prone to health issues. That must remain its focus. But it needs to realize that there are ways to do things better, faster, cheaper, and designed to be easy to use for providers and patients.

Let me restate my central question. Why is this happening? Let me ask you to join the conversation with your thoughts. Getting to the core reason will not only help healthcare investors, but more importantly, anyone providing or getting healthcare.

Tom Furr is founder and CEO of PatientPay of Durham, NC.

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January 6, 2016 Readers Write No Comments

Morning Headlines 1/6/16

January 6, 2016 Headlines No Comments

NantWorks and NantHealth Complete Acquisition of Navinet, America’s Leading Healthcare Collaboration Network

NantWorks and NantHealth acquires NaviNet, a payer-provider collaboration platform, for an undisclosed sum. The acquisition aligns with NantHealth’s vision of “delivering on whole health systems integration.”

Mayo sells data center for $46M to new IT partner

Mayo Clinic sells its data center to Epic for $46 million and will lease it back from Epic for the next four years, with an option to continue the arrangement indefinitely.

No time for stodgy: Crusading editor aims to shake things up in science

The British Medical Journal is being criticized for its perceived transition from a science magazine to one that takes controversial political stances. One Yale epidemiologist comments BMJ “should carefully think about what it wants: to remain a top scientific medical journal, or to transition into a public-opinion publication that seeks to attain the highest ratings possible based on one-sided positions that are not carefully researched.”

Many See IRS Penalties as More Affordable Than Insurance

The New York Times reports on the 10.5 million Americans who are eligible to buy coverage through an insurance exchange but are still uninsured, noting that for many the $1,800 IRS fee is still far cheaper than paying for an insurance policy.

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January 6, 2016 Headlines No Comments

News 1/6/16

January 5, 2016 News 3 Comments

Top News


NantWorks and NantHealth acquire eligibility and benefits management software vendor NaviNet, explaining that, “we are now poised to be the nation’s leading healthcare collaboration network by transforming the payer-provider relationship to evolve from transactions to interactions and finally to collaboration,”adding that NaviNet Open will serve as a web portal for cancer patients and providers. NaviNet sold its PM/EHR customer base, which was using rebranded versions of CureMD products, to CureMD in 2013 in continuing its focus on payer-provider collaboration tools. NaviNet was in 2012 acquired by Silicon Valley investor John Doerr’s Essence Healthcare, which I believe still owns ClearPractice and Lumeris.

Reader Comments

From Walter: “Re: health systems moving to Epic or Cerner. If you want to predict those, start with a list of McKesson Horizon and then Paragon clients.” I haven’t seen the numbers of Horizon customers who have followed McKesson’s hopeful suggestion that they replace their now-retired system with Paragon, but I’m guessing they are negligible.

From The PACS Designer: “Re: WiFi HaLow. At the Consumer Electronics show this week, the WiFi Alliance announces a new service called WiFi HaLow. It will bring a longer-range, low-power WiFi application that could benefit the patient engagement initiatives in healthcare as well as applications in other healthcare areas.” HaLow also penetrates walls better, which coupled with longer ranges and less battery drain should make device connectivity (including wearables) more practical. Unlike Bluetooth, HaLow connects devices directly to the Internet, not just to a smartphone.

HIStalk Announcements and Requests


Quite a few folks in health IT-land like this recent Dilbert, which might be the perfect preview (or replacement for) the HIMSS conference techno-blather.


Ms. Brown from Michigan sent photos of students in her K-3 special education resource room using the math puzzles and learning centers we provided by funding her DonorsChoose grant request.

I was thinking about the HIMSS conference and that my least-favorite US city — Las Vegas — has the perhaps unique distinction in that its residents indignantly scorn tourists who pronounce its state name correctly as “nev-AH-dah” instead of the local version “nev-AD-ah,” which is probably an ongoing challenge given that 75 percent of the state’s residents were born elsewhere. I suppose it’s like cities whose names we Americanize (i.e., we say it wrong) as we scorn those who say the name correctly (Los Angeles, St. Louis, New Orleans, and probably a bunch more). My go-to example for the odd-but-universal pronunciation is the Empire State Building, which you and everyone else say as “empire STATE building” even though New York is the Empire State and therefore the name should be pronounced “EMPIRE state building.”

Listening: the new and first EP from Cado Young, a couple of young guys (one of whom I’ve met) who have created some polished, hard-edged alternative music that deals maturely with the human condition.


January 13 (Wednesday) 1:00 ET. “Top 5 Benefits of Data as a Service: How Peace Health Is Breathing New Life Into Their Analytics Strategy.” Sponsored by Premier. Presenter: Erez Gordin, director of information management systems, Peace Health. Finding, acquiring, and linking data consumes 50 to 80 percent of an analyst’s time. Peace Health reduced the time analysts were spending on data wrangling, freeing them up to create new actionable insights.

Contact Lorre for webinar services. Past webinars are on our HIStalk webinars YouTube channel.

Acquisitions, Funding, Business, and Stock


Mayo Clinic sells its data center to Epic for $46 million and will lease it back from its EHR vendor. That’s news everywhere except here since reader Sturges said exactly that in as a perfectly accurate Rumor Report from April 6, 2015.


Navigant acquires 70-employee McKinnis Consulting Services for $52 million to expand its revenue cycle management consulting practice.


Healthfinch raises $7.5 million in a Series A funding round, planning to use the money to complete development of its EHR “extender tool” that will expand its business beyond automated prescription refill management technology. The 30-employee Healthfinch was founded by biomedical engineer Jonathan Baran and Lyle Berkowitz, MD.


Minneapolis-based virtual care technology vendor Zipnosis raises $17 million in Series A funding, with Ascension Ventures and Fairview Health Services participating. The company offers a white-label virtual care portal for provider groups in which patients answer online questions and are then triaged to an appropriate clinician.


Pre-surgery patient portal software vendor One Medical Passport receives a $4 million Series A investment.


Smart pill bottle manufacturer SMRxT, whose name veers off the “distinctive” roadway into the “utterly unpronounceable as written” swamp, moves its headquarters from New York to Orlando. The company pronounces its name “Smart” in ignoring its own un-clever “Rx” pun and incorrect capitalization that renders the entire nomenclature exercise baffling, making me question whether it employed too much or too little marketing expertise.


Imaging technology vendor Sectra acquires Sweden-based RxEye, which offers a medical imaging collaboration platform.



Healthwise promotes Adam Husney, MD to chief medical officer.


Microsoft senior director of worldwide health Bill Crounse, MD retires from the company.

Privacy and Security

Hackers take down three electric power substations in the Ukraine by installing malware packaged as Microsoft Office document macros, with the resulting blackout sure to cause concern that similar actions could affect healthcare facilities if careless employees (was that redundant?) open documents from unknown sources.



Twitter will expand the 140-character Tweet limit to as many as 10,000 characters as it had already done for private messages. The downside is that plenty of Tweeters were already stretching the limits of their appeal within their allotted count of 140, now giving them the opportunity to move from “dull” to “insufferable.” On the upside, people were already kludging around the limit by taking screenshots of text anyway. Maybe a compromise would have been to expand the character limit while imposing a tweets-per-day cap.



Critics question whether BMJ (the cute name that replaced British Medical Journal) has turned itself into a populist magazine rather than a scientific journal with its sometimes poorly researched editorial campaigns. The editor in chief acknowledges that it’s a fine line, explaining, “Some people would say we have gone too far down the magazine route. But we have no doubt that we’ve increased our influence and increased our readership among clinicians.”


“Brain training” games vendor Lumosity will pay $2 million to settle FTC charges that it made unfounded claims that its software can help reduce age-related cognitive decline.

The bad news is that a year’s worth of a new drug for pulmonary artery hypertension will cost a patient’s insurance $170,000, based on the price set by its manufacturer that expects to sell more than $1 billion worth per year. The good news is that it’s still cheaper than existing drugs for the same condition. The more-bad-news is that insurance companies will surely pass the cost along to the rest of us because that’s how insurance works, meaning everybody is happy except the majority of Americans who don’t have the condition who are paying big premiums without getting much in return.

The New York Times observes that millions of Americans are declining to buy medical insurance since it’s more expensive than the penalties involved in not buying it, capturing some interesting logic from the folks they interviewed:

  • One woman says it’s better to die if something catastrophic happens, defying the government to collect the $1,500 fine she will owe in electing not to buy insurance.
  • A man who doesn’t like poor out-of-network coverage comments, “I’m just going on the hope that nothing bad is going to show up until I get a full-time position somewhere or there’s better choices.”
  • An artist who dropped his $455 per month plan that covered “zero medical expenses” says, “You’re asking a bunch of people to basically just give money into the system when they have an option not to,”
  • A woman who says she just keeps antibiotics in her home rather than buying insurance says, ““I do not believe it serves the public good to entrench private insurance programs that put actual care out of reach for those they purport to serve,” adding that she hopes any disaster happens while driving since her auto insurance covers personal injury.

Sponsor Updates


  • AdvancedMD staff donates 4,402 pairs of socks to The Road Home, a social services agency that helps the homeless in Salt Lake City.
  • VentureBeat profiles AirStrip’s work with the University of Michigan and IBM to predict when a patient will become ill.
  • Aprima Medical Software donates a record eight tons of food to needy families in the Dallas area as part of its annual food drive.
  • CareSync CEO Travis Bond will speak in March at the South by Southwest Interactive Festival in Houston.
  • The Times of India features CitiusTech HR VP Sowmya Santhosh and her thoughts on accommodating different personalities in the workplace.
  • Divurgent releases a white paper, “Population Data: Healthcare’s Critical Success Factor for Health Management.”
  • E-MDs selects Dell Children’s Medical Center for its 2015 holiday giving program.
  • The local business paper profiles new GE Healthcare CEO Lee Cooper.
  • Greencastle Associates Consulting recounts the part it played in Einstein Medical Center’s EHR rollout.
  • The Huntzinger Management Group ranks number 10 in Consulting Magazine’s list of fastest growing firms of 2015.

Blog Posts


Mr. H, Lorre, Jennifer, Dr. Jayne, Dr. Gregg, Lt. Dan.

More news: HIStalk Practice, HIStalk Connect.

Get HIStalk updates.
Contact us or send news tips online.



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January 5, 2016 News 3 Comments

Morning Headlines 1/5/15

January 4, 2016 Headlines No Comments

Health Insurance Portability and Accountability Act Privacy Rule and the National Instant Criminal Background Check System

HHS issues a final rule modifying HIPAA to allow psychiatrists to report potentially violent patients that should be prevented from purchasing a gun to the National Instant Criminal Background Check system.

Meaningful Use: When the Exemption Becomes the Norm

Athenahealth SVP and General Counsel Dan Haley discusses the impact that blanket MU hardship exemptions will have on the program at large, saying “when every program participant is potentially exempt from the application of what was heretofore deemed a key component of said program, there really isn’t a program any more.”

Artificial pancreas system aimed at type 1 diabetes mellitus

Researchers at Harvard Medical School will begin the largest-ever long-term clinical trial of an “artificial pancreas” comprised of an implantable continuous glucose monitor and  an insulin pump that will work together to auto-regulate insulin levels for Type 1 diabetics.

25 W.Va. hospitals see $265 million drop in uncompensated care

In West Virginia, uncompensated care has dropped $265 million in the last year, a shift attributed to an overall drop in the uninsured rate brought on by the ACA.

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January 4, 2016 Headlines No Comments

Curbside Consult with Dr. Jayne 1/4/16

January 4, 2016 Dr. Jayne No Comments


This year started with a bang as I received my first request to bid on a new consulting engagement over the weekend. I need to do quite a bit of discovery before I decide whether or not I’m going to take it, but I admit I’m seriously intrigued.

It’s from a group of physicians that consults at various extended care facilities and nursing homes where documentation is still done on paper. They’re looking at ways to better manage the use of potentially harmful medications in the elderly. Their needs initially sounded like more of a traditional “assistance with system selection” effort, which I’ve done quite a bit of. That’s how they heard about me. But the more we talked, I understood that they’ve already narrowed it down to three vendors and are looking for some very pointed critiques of the approaches.

In hearing overviews of the proposals, they range from moderately serious to what sounds downright comical. They seem like they would be a good bunch of people to work with, although I’m halfway tempted to tell them they need to choose Door #4 and go back to the drawing board. I can tell from several states away that the one proposal was cooked up by some sales team who really doesn’t understand the business or the needs of the providers and I’m tempted to take the job just to skewer them. I’m not sure I’m going to be able to dedicate enough time to this job as it would likely need, so I may have to take a pass depending on their timing and some other factors.

I worked New Year’s Eve in the trenches, which is always a good time. My experience over the years is that staff members working the holidays tend to be motivated to help move things along as quickly as possible, since you never know when your next rush of patients is going to arrive and you don’t want to be caught behind if you can help it. My shift ended before midnight, though, so I didn’t get to see a lot of the more story-worthy patient visits.

I can say honestly, though, that influenza season is here in full force. If you haven’t received a vaccination yet, there’s still time and I would encourage everyone to do so. If this weekend is any indication, there’s a high potential for this season being quite challenging.

I spent the rest of the weekend getting caught up on email and around the house. My goal this year is to not have an inbox that is perpetually full.

I took particular delight in clicking “delete” on a couple of emails from CMS. One was regarding batch upload for 2015 EHR incentive program attestations. Although I’m still peripherally involved in assisting my clients through this process, I am glad to not be personally accountable for managing the process for my own physician group. The attestation period for Medicare programs starts today and runs through February 29 for those of you playing the home game.

I also enjoyed deleting a CMS “year in review” email celebrating a look back at ICD-10. There were several emails from CMS and ONC covering their joint effort to address quality measure reporting under the various inpatient and ambulatory reporting systems as well as the EHR incentive program. They’re trying (again) to streamline the reporting process and reduce the burden to users, organizations, and vendors, but I’ve not been impressed by their previous work in this regard.

I also found an email from CMS about the new Medicare Drug Spending Dashboard and spent a few minutes checking it out. Drugs were selected for inclusion on the main dashboard due to high total program spending, high annual spending per user, or a large increase in average cost per user. Some of the drugs having the highest jumps were generics – why is digoxin up 298 percent? It’s been generic as long as I’ve been practicing. It’s still relatively cheap in the grand scheme of things, but I was surprised by the numbers.

Not surprising was the inclusion of several medications that are extremely expensive and often-prescribed despite being only marginally more effective or tolerated than the traditional / generic / cheap competitors. There were more than 20 drugs on the list which have more than $1 billion in total spending (2014 data) with some in the $3B range. The original email about the dashboard mentioned that HHS convened a group of consumers, providers, employers, vendors, payers, government agencies, and others to discuss how to balance “the dual imperatives of encouraging drug development and innovation while ensuring access and affordability.” I’d personally like to see Medicare beneficiaries take this list to their doctors and if they are on some of these high-dollar drugs, discuss whether there are alternatives and how much benefit they’re really getting from the Cadillac vs. the Buick vs. the Chevy and how that meets their life goals.

I shudder when I see patients in their 80s and 90s who are on medications that are adding little to their health besides higher costs and an increasing risk of complications due to polypharmacy. I remember when a patient in her early 90s came to “interview” me as she was shopping for a new doctor. She and her daughter (who was 70) came to talk about my philosophy of geriatric care. She was reasonably healthy and shared a home with her daughter and had only been hospitalized once in the previous five years. I honestly told her that I didn’t have a lot of patients in her age bracket, but if she were to join my practice, my main goal would be to prevent as much as possible and to give her medications only if absolutely required. I must have made an impression because she transferred her records the following week.

Some of the reporting around the CMS drug dashboard data shows the shift in disease burden as different populations join the Medicare rolls. Hepatitis C treatment has a significant cost impact along with cancer, diabetes, and pulmonary disease. It also mentions that this is only part of the relevant data – it doesn’t include spending data for commercial payers, Medicaid, the VA, or the military and doesn’t show whether there are rebates or other cost-shifting arrangements.

I expect Medicare to be insolvent by the time I’m 65 and out-of-pocket costs to be absolutely insane, so I’m doing what I can to keep chronic disease off my doorstep. Although I’m not the most disciplined when it comes to food choices (the pastry therapy doesn’t really help either), I’ve got a pretty solid relationship with my treadmill since I upgraded it early last year. Committing to be on it as many days as possible is as close to a resolution as I’m getting.

What’s your New Year’s resolution? Email me.

Email Dr. Jayne.

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January 4, 2016 Dr. Jayne No Comments

Startup CEOs and Investors: Marty Felsenthal

The JPMorgan Healthcare Conference and the State of Healthcare Innovation
By Marty Felsenthal


I had a lot of fun last year at this time writing about the JPMorgan Healthcare Conference. With thanks to Mr. HIStalk, I thought I’d take an opportunity to provide an update on the conference (it’s happening next week in San Francisco) and also on the state of innovation in healthcare services and healthcare software, as the two subjects are very related.  

This will be my 19th consecutive year at the conference, a streak that a handful of the very coolest people might find more impressive than the Golden State Warriors’ winning streak at the beginning of the NBA season. I have been investing in venture-backed healthcare software and services companies for all of those 19 years. I’m recently and temporarily retired, but I’ve been fortunate to have generated strong returns during my career, to have worked with some great entrepreneurs, and to have worked with wonderful partners.  

That said, and as I mentioned last year, until the HITECH and the Affordable Care Acts were passed, I was as relevant as Rand Paul in a Republican debate or a movie theatre showing “Star Wars” I, II, and III. Until 2010, there was certainly innovation in the provision and administration of healthcare, but it was just more limited and — relative to its potential importance to our country — not enough people cared. That all changed with the passage of those two pieces of legislation.  

Once it became obvious that legislative and judicial efforts to change or repeal the Affordable Care Act would not be successful, almost overnight I underwent a combined transformation like Shia LaBeouf (Megan Fox) in “Transformers I,” Anthony Michael Hall (Kelly LeBrock) in “Weird Science,” and Will Ferrell (his first wife Leslie Bibb) in “Talladega Nights.” Life is pretty good these days for people like Steph Curry and me.

With Reform here to stay, the JPMorgan Healthcare conference became the Comic-Con of the healthcare services and software world. The conference this year will be every bit as crowded and frenetic as in recent years past. However, there are, in my opinion, two very big differences from last year.  

When we’re out with friends, my loving wife of 17 years often refers to me as her "old" husband and then goes on to describe what her "new" husband is going to be like. I still haven’t figured out if she intends to leave me, kill me, or just wait for nature to take its course, but she has made it very clear he won’t snore, he won’t nap on weekends, and he’ll be better at taking advice.  

The first big difference at the conference this year is the number of "old" companies that aren’t presenting — or at least won’t be presenting in 2017 if their mergers are completed. During 2015, we have seen a tremendous amount of consolidation activity in healthcare companies attempting to reduce SG&A as a percentage of revenue through the benefits of scale; attempting to gain negotiating leverage with payers or providers (as the case may be) through horizontal consolidation; attempting to gain the benefits of vertical integration by owning more of the value chain; and attempting to diversify away from their core business into areas of the healthcare value chain that potentially have more opportunity and/or may be less regulated.

OmniCare, Rite-Aid, IPC The Hospitalist Company, United Surgical Partners, Vanguard Health, Cigna, Humana, HealthNet, Catamaran, Merge, and Gentiva are just a partial list of public companies that have announced acquisitions this past year and won’t be presenting this year (or next, depending on their merger timing). There are countless other private companies that have been acquired by United, Optum, CVS, Blue consortiums, AmSurg, Emdeon, The Advisory Board, IBM, and others.  

I don’t know this for certain, but as a lifelong fan (for the past 3-4 years) and someone who one day aspires to own 0.0000001 percent of the Warriors, I’d wager my next NBA championship ring that there was more merger activity by dollar volume in healthcare services and healthcare software this year than we’ve ever experienced. This trend will absolutely continue in 2016.

The second big difference at the conference this year is the number of newly public and potentially very disruptive health care software and services companies presenting at the conference this year, all of which speak to the changing healthcare landscape.  

  • Evolent Health (NYSE: EVH) is presenting. The company provides technology and services to help health systems manage full or partial risk, obviously a huge opportunity in the transition to value-based care.
  • Press Ganey (NYSE: PGND) is newly public and deploys its technology and services to help providers measure and manage patient satisfaction, which is increasingly being tied to reimbursement and will only get more and more important as insurance networks get more narrow. 
  • Inovalon (NASDAQ: INOV) is presenting and is a very interesting company that helps health plans and provider organizations collect the necessary data to get paid appropriately, and more importantly, analyze that data to measure quality and identify opportunities to improve quality. 
  • Teladoc (NYSE: TDOC) is also presenting (disclosure:  I’m on the board of Teladoc). Teladoc is deploying its telemedicine platform across many specialties and in the payer and provider communities to address issues related to access, convenience, and cost. 
  • HealthEquity (NASDAQ: HQY) completed their IPO in the second half of 2014, but they also represent another newly public and innovative company helping consumers navigate the transition to high deductible health plans with better tools and engagement. 
  • FitBit (NYSE: FIT) isn’t presenting, but they have participated in healthcare conferences in the recent past and went public last year. I’m always a little torn about whether this is really a healthcare company, but suffice it to say the potential for inexpensive remote monitoring in healthcare using a tool like FitBit is pretty immense. 

These six companies had IPOs in the past 18 months and collectively represent more than $10 billion of market value.

In my 19 years of going to the conference, I’d wager my likely nomination as the next head of HHS that this is the first-year ever that the JPMorgan Healthcare conference had six newly public and truly disruptive healthcare services and healthcare software companies presenting. That’s a very big deal for healthcare — it will lead to more great entrepreneurship and it speaks to the great market needs and opportunity being created by healthcare reform.

This brings me to the current state of innovation in healthcare software and healthcare services, with a little bit of advice for entrepreneurs and larger companies alike trying to capitalize on that innovation.  

I’ve never been more optimistic or excited. Pessimists will point to the unsustainability of the exchanges (unaffordable for most in their current form without subsidies and attracting too few healthy people). They’ll say hospitals can’t manage physicians or assume risk. They’ll say that the sector is over-funded with venture and growth capital, there are too many companies being formed to do exactly the same thing, there are too many inexperienced entrepreneurs, and there are too many inexperienced investors. They’ll also point to the venture markets more broadly and the vulnerability of all the unicorns.

All fair points, but I have unbridled optimism for healthcare right now. I don’t think there has ever – ever — been a better opportunity to create more successful healthcare software and services companies, to make them bigger, and to do it faster (I sound like Oscar Goldman in “The Six Million Dollar Man”). I think the healthcare sector is undergoing the same kind of transformation that the financial services sector started in the 1970s and that continues to this day. The changes at the JPMorgan Healthcare conference I described above are a great reflection of the beginnings of that transformation and opportunity.

Healthcare is the single largest sector of the economy at almost $3 trillion. While there are certain things our healthcare system does extremely well and better than anyone else in the world, there are other aspects that are very broken. It obviously costs too much, we use way too much paper and don’t take advantage of software and automation to the extent other industries do, we still use way too much MUMPS and client-server technology, we don’t routinely use clinicians at the top of their license, our reimbursement system has historically incented volume instead of value, we aren’t as thoughtful about care at the end-of-life care as we should be, care is too fragmented and poorly coordinated, hospital systems don’t treat their best customers like a valuable asset that could walk across the street to a different system, insurers have customers paying them more than $10,000 per year year after year and do nothing to establish a personal relationship…

It’s an obvious list that could go on and on, and therein lies the opportunity. It’s so obvious. As a country with a political and economic system that responds better to change than any other place in the world, entrepreneurs have always risen to the task when markets were broken and/or a catalyst was provided. The Affordable Care Act (for all its imperfections) provided that spark. In my opinion, we’re in the top of the first inning of a game that’s going to last two to three decades. 

My advice to entrepreneurs is simple. Start your company. Try to think of a unique business or clinical problem that isn’t currently being addressed. Surround yourself with experienced people who have built businesses before. Recognize that you have an opportunity cost so establish a set of metric-based milestones that represent the least you’d hope to achieve over the next six, 12, and 18 months. Stick them on your bathroom mirror, stare at them every morning, and hold yourself accountable / be honest with yourself. If you aren’t hitting them, change paths or go do something else.  

Also, pick your financial partners carefully. Money is flowing loosely and freely in this environment. Personally, I think a lot of these capital sources are, in fact, a commodity (and some worse), but there are some truly value-added sources out there and I’d take their money at a discount to work with the right partner.

I’m biased towards experience so that you can diligence what you’re getting from your capital partner. I’d ask for every example they can provide of commercial contracts they introduced to (or helped facilitate for) the companies they invested in. I’d ask the same of every management team member they introduced. I’d make reference calls on them the same way they make reference calls on you and ask to talk not only to CEOs they did well with, but CEOs they fired or CEOs with whom they lost money.

Ask how they think about capital intensity and burn. Personally, I think one of the single most important areas where an investor can add or detract from value is helping to determine whether it’s time to throw fuel on the fire or to continue to let things simmer based on the market size, the competitive environment, the exit environment, and the company’s proven or unproven ability to execute. 

I started my investing career at the tail end of the dot-com bubble in the late 1990s. I was fortunate to have generated returns well above the benchmarks during that environment, too. For the reasons mentioned above, I do think this time is different, but there are some valuable lessons for entrepreneurs.

First, you can raise too much money. If you raise $50 million to execute against an opportunity where your exit is only going to be $75-$100 million, you won’t do too well and your investors won’t be too happy (and ours is a small community, so you want happy investors to back you or speak well of you for whatever you do next).

Second, just because you raised all that money, please don’t feel obligated to spend it. To my point above, I think it’s very important to manage your burn and be extraordinarily disciplined about when you put fuel on the fire.  

Third, every young company hits a bump (or five) in the road. The line to success is never straight. Treat everyone as respectfully and thoughtfully as possible because even though you’ve got everything figured out today, that might change tomorrow and you will still want doors to open freely and eagerly for you.  

Similar to the late 1990s, we’re seeing a tremendous amount of interest from a wide variety of large companies who want to partner with young, innovative companies. This is happening in the broader economy and in healthcare specifically.  

Until recently, I was a managing partner at a wonderful venture firm that included as its limited partners some of the largest for-profit and not-for-profit insurers, health systems, pharmacy chains, and healthcare foundations in the country. We also had the opportunity to interact with drug distributors, diagnostic companies, multi-sector technology firms, PBMs, and others who were equally interested in a window into healthcare innovation. There are some common characteristics of larger organizations that partnered with young and innovative companies the best.

First, they recognize that innovation is only a means to an end. There were too many large companies in the late 1990s (Time Warner AOL being the best example) and too many companies in this cycle pursuing innovation and change just because their competitors did it or just because something seemed cool and hip. The laws of nature still apply and you need a clear business objective, a product that makes sense, and a business model that makes sense.  

When partnering with young companies, don’t worry about over-paying or every little contract detail. You presumably have a strong balance sheet. To a degree, small differences in price or terms at this stage don’t make a difference in the long run.  

What makes a difference is whether you picked the right company. I was fortunate to have led a financing round at Teladoc early on and at the lowest valuation. However, the truth of the matter is that each investor in the subsequent three private rounds have generated outstanding returns to date as well. I led a later and more expensive round at Change Healthcare before Emdeon acquired it. In both cases, it almost didn’t matter what round you participated, just that you partnered with them.  

To that point, when partnering with innovative companies, the most important thing you can do is pick the right partner, and good people obviously make good partners. Avoid entrepreneur hubris when coupled with inexperience. Treat good people well. Give them responsibility. Be flexible and responsive with them. Commit to make the partnership work. Provide transparent and timely feedback on how the partnership is working and ask for the same. If you buy or partner with a company with good people, figure out ways to make sure the good people stay and to make sure they expose the rest of the organization to what they’re working on.  

There are some great examples of large companies that do innovation well. Aetna partnered successfully with lots of our portfolio companies. United / Optum have been wonderful at almost all of the points above.  A number of Blue Cross Blue Shield plans have really stepped up their games in the past decade with direct investments, collaborative investments, and partnerships and acquisitions of technology companies.   Walgreens and CVS have done it well with their retail clinics  UPMC and The Advisory Board have done it with Evolent. Intermountain Healthcare, Geisinger ….it’s a very large and growing list and much larger than just these companies.  

Some of their common themes are that innovation has senior level sponsorship and multiple sponsors. Many of these organizations have a senior-level executive (or someone reporting to a senior-level executive) whose responsibility is to act as facilitator between the executive sponsors of innovation and the folks in the lower parts of the organization who actually get things done. These organizations also make sure to incent their teams — not just on the next big acquisition or meeting projections, but on some of these softer points around innovation. Some of them provide capital for off-cycle and off-budget rapid pilots.  

Much more so than HIMSS, the JPMorgan Healthcare Conference is a microcosm of our healthcare ecosystem because it covers every major and minor sector of the market, not just technology. The name of the game at the conference for the past six years (and in healthcare more broadly) is change, and every student of markets knows that big change always creates big opportunity. Healthcare is the single largest sector of the US economy and it is undergoing an unprecedented amount of change. 

It’s going to be a great year for the entrepreneurs, investors, and large companies that can capitalize on it. Most important, I’m very optimistic that patients are also going to end up better off for all this change — with better and more consistent quality, with lower-cost alternatives, and with a much improved consumer experience.

Marty Felsenthal has been working with and investing in innovative healthcare software and services companies since 1992 and has led financings and/or provided growth capital to companies such as Teladoc (TDOC), Change Healthcare (acquired by Emdeon), Aperio (acquired by Danaher), PayerPath (acquired by Allscripts), Titan Health (acquired by United Surgical Partners), and USRenal Care (acquired by Leonard Green).

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January 4, 2016 Startup CEOs and Investors 1 Comment

Morning Headlines 1/4/16

January 4, 2016 Headlines No Comments

Epic Systems growth expected to continue

A local paper reports that Epic’s employee base has grown to 9,400, increasing by 1,400 in the past year.

Patients given just hours warning to attend hospital after problems plague new IT system

In England, an estimated 20,000 patients at Hull and East Yorkshire Hospitals NHS Trust have erroneous data in their medical records and appointment waitlists jumped from 40,000 to 60,000 patients as a result of a troubled CSC Lorenzo EHR migration.

How Denmark Dumped Medical Malpractice and Improved Patient Safety

ProPublica analyzes the results of Denmark’s decision to eliminate malpractice suits, replacing them with a government-run claims program that pays patients when they are harmed, but also collects the details of their case and uses it to improve the overall care delivery system.

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January 4, 2016 Headlines No Comments

Monday Morning Update 1/4/16

January 3, 2016 News No Comments

Top News


The Madison paper reports that Epic’s headcount has increased to 9,400, up 1,400 in the past year. Campus 4 and Campus 5 are under construction and will add 3,500 offices and the company is sharing the cost of expanding Nine Mound Road to four lanes to handle Epic employee traffic. The company also announces that it has 360 healthcare organization customers in 10 countries and booked $1.8 billion in 2014 revenue.

Reader Comments


From Crank Caller: “Re: McKesson. I agree with your prediction that it will divest its health IT business. I’ve heard from two reliable sources within McKesson that Paragon is for sale, not that anyone would want to buy it.” Unverified, but the company seems to be constantly apologizing for its health IT business, it hasn’t produced great numbers, the Better Health 2020 initiative doesn’t seem to get much airplay after an initial big splash, and the company has shut down product lines like Horizon. With the retirement of Jim Pesce, anything could happen.


From Simmering Stock: “Re: 2015 share price performance. Some vendors are traded on non-US exchanges.” I intentionally limited my list to companies whose shares trade on US exchanges, but some that don’t are:

Pro Medicus (parent company of Visage Imaging), Australian Securities Exchange: up 191 percent
Craneware, London Stock Exchange: up 68 percent
Orion Health, New Zealand Stock Exchange: down 45 percent

From HIPAA Shake: “Re: your medical records request. Did you ever hear back from the Office for Civil Rights?” I filed a complaint in July with both OCR and the hospital that refused to provide me with an electronic copy of my medical records (the hospital claimed it is required to do so only for providers and patients can only get printed copies). I haven’t heard back from either organization. Good thing I haven’t been comatose for the six months with my doctor anxiously waiting to see what happened during my one-day stay in early 2014.


From EHR Product Manager: “Re: LA Times op-ed piece on physician working conditions. I left a faith-based academic medical center to work on the vendor side, which definitely has a better work environment. The AMC emphasized work-life balance but I couldn’t get them to let me work remotely even one day a week, which is a given in the vendor world. Is healthcare seeing a brain drain due to perceived lack of perks?” The Stanford medical student’s article says it’s easy to understand why the school’s graduates often forego residency to jump straight into industry in contrasting their environments: the working conditions for low-pay medical residents involve fluorescent lights, endless pages, and cell-like on call rooms, while business school students ride fancy buses to tech companies that provide free gourmet meals, gyms, massages, and on-site services such as bike repair and yoga classes. I would hope that those who choose to pursue professions such as medicine or the ministry don’t expect the eye-popping perks awarded to a tiny percentage of the young workforce who are chosen to work at Google or Facebook (or Epic, for that matter) — I’d rather see the folks who are torn between patient care and Silicon Valley just hire on with Google instead of naively wasting a medical school spot. Excluding poor working conditions for residents, hospital jobs are a mixed bag, especially for non-executives who aren’t eligible for bonuses, fancy offices, and expense accounts. Sometimes the time-off policy is pretty generous and layoffs are less frequent, but otherwise the rewards of hospital work mostly involve the satisfaction of helping people rather than helping yourself. It’s also not a given that people have a choice between the two worlds – hospitals hire lots of people who overestimate their own capabilities in failing to realize that nobody else would want them. My only conclusion is that medical schools should paint a realistic picture of what it’s like being a doctor before offering admission to a student who might have unreasonable expectations, but that’s not their business model — university tuition coffers are filled by students who are destined for a rude awakening when they realize that their expensive degree has little market value or has prepared them for a job nobody would really want.

HIStalk Announcements and Requests


Cerner and Epic share the lead as the companies for which poll respondents lost the most respect for in 2015. New poll to your right or here: what are your HIMSS conference plans?

I hope everyone enjoyed their most-of-December industry slowdown. The industry rocket is about to blast off now that New Year’s is behind us and HIMSS is just eight weeks away. News was understandably slow last week, so today’s post won’t consume too much of your first-day-back output.

Last Week’s Most Interesting News

  • ProPublica launches a searchable database of health data breaches and privacy complaints.
  • A new law takes effect that allows CMS to fine insurance companies for publishing incorrect provider databases.
  • AMA President Steven Stack, MD names EHRs as the top cause of physician frustration.
  • A New York non-profit rolls out an app that alerts volunteer first responders of nearby medical emergency 911 calls.


January 13 (Wednesday) 1:00 ET. “Top 5 Benefits of Data as a Service: How Peace Health Is Breathing New Life Into Their Analytics Strategy.” Sponsored by Premier. Presenter: Erez Gordin, director of information management systems, Peace Health. Finding, acquiring, and linking data consumes 50 to 80 percent of an analyst’s time. Peace Health reduced the time analysts were spending on data wrangling, freeing them up to create new actionable insights.

Contact Lorre for webinar services. Past webinars are on our HIStalk webinars YouTube channel.

Acquisitions, Funding, Business, and Stock


South Carolina-based Singular Sleep offers $249 home-based sleep apnea studies and $69 online consultations for patients in 13 states.


The Chicago business paper profiles Prepared Health, which offers a care team communications platform. The company was started by folks formerly with Medicity.



Bruce Matter (AMC Health) joins Banyan Medical Systems as EVP of sales.



In England, problems with the implementation of CSC/iSoft Lorenzo at Hull and East Yorkshire Hospitals NHS Trust cause extended patient waitlists and short appointment time notices.

ProPublica covers Denmark’s 1992 elimination of medical malpractice lawsuits, replaced by a national compensation program in which patients file claims that are reviewed by independent experts who set compensation in return for gaining access to the details for ongoing improvement. The two most-used criteria there are: (a) was care of substantially lower quality than a specialist would have provided; or (b) did the patient experience a rare medical event, such as an unusual drug reaction. The average paid claim is $30,000, but citizens there file seven times the number of claims as in the US and four times more patients per capita receive awards. Doctors there are also legally required to tell patients when they’ve been harmed during medical care. The president of a US association of malpractice lawyers hates the idea, of course, fretting that “those with economically viable cases would take pennies on the dollar when their case is worth substantially more.” He left unstated the obvious two last words of the sentence that motivates him: “to me.”


Mr. H, Lorre, Jennifer, Dr. Jayne, Dr. Gregg, Lt. Dan.

More news: HIStalk Practice, HIStalk Connect.

Get HIStalk updates.
Contact us or send news tips online.


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January 3, 2016 News No Comments

Morning Headlines 12/31/15

December 30, 2015 Headlines 1 Comment

Nearly 1 in 3 patients say email communication with providers improved their health

Researchers from Kaiser Permanente have published results from a 1,000-patient survey,  finding that one-third of patients who sent messages to their providers said it improved their health, led to less office phone calls, and reduced office visits.

Valeant Says CEO J. Michael Pearson Is on Medical Leave

Valeant CEO J. Michael Pearson is being treated for pneumonia and will be on medical leave for an indefinite period. In his absence, the company will be run by a three-man office of the chief executive.

North Shore-LIJ ends first nine months with higher margin

North Shore-LIJ Health System (NY) ends its third-quarter with $6.4 billion in revenue, up from last year’s $5.4 billion, but ended the quarter flat due to poor investment performance.

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December 30, 2015 Headlines 1 Comment

Morning Headlines 12/30/15

December 29, 2015 Headlines No Comments

HIPAA Helper: Who is Revealing Your Private Medical Information?

ProPublica publishes a search tool that lets consumers search for doctors, hospitals, insurers, and pharmacies to see if they have had any data breaches or privacy complaints.

Health Insurers to Face Fines for Not Correcting Doctor Directories

Starting Friday, CMS will be able to fine insurers $25,000 per beneficiary for errors in the Medicare Advantage provider directory and $100 per beneficiary for errors in plans sold on public exchanges.

Avoid ageism when testing physicians

A blog post debating the value of competency testing for aging physicians suggests that testing should be rolled out across the board and not just for aging physicians, citing inconclusive research on the influence age has on clinical performance.

Cyber security: Attack of the health hackers

Financial Times estimates that 100 million patient records were stolen by hackers in 2015, with 80 million coming from the Anthem breach alone. Eight of the 10 largest healthcare hacks on record happened this year.

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December 29, 2015 Headlines No Comments

News 12/30/15

December 29, 2015 News 10 Comments

Top News



ProPublica launches HIPAA Helper, which allows searching government data to see if a given provider or insurer was named in privacy complaints, breaches, or violations. The organization calls out frequent offenders , none of which have been assessed penalties by the Office for Civil Rights. 

Reader Comments


From The PACS Designer: “Re: fluorescent camera pills. As we get smaller technology in the form of camera pills, the innovations become exciting. Florescent technologies are now so small that they can be inserted into a swallowed form that includes a camera that can now detect cancer without using an endoscope. The sensor used is called the single photon avalanche detector (SPAD) and it can detect single light photons given off by the molecules in human tissue.”


From Dorm Fridge: “Re: saying ‘no problem.’ I say it to indicate that whatever I did wasn’t a burden. It makes just as much sense as ‘you’re welcome.’” “You’re welcome” indeed doesn’t make much sense (nor does “thank you,” for that matter – why not “I thank you?”) but at least it’s traditional. Just about everybody I’ve heard say “no problem” — or its even more annoying variant, “not a problem” — is under 30, so I certainly wouldn’t use the phrase when trying to sell something to curmudgeonly older executives. I’ve also noticed that younger folks have unnecessarily raised the gratitude gamesmanship by embracing “thank you SO MUCH,” oddly pronouncing the “so” more like “soul.” Here’s a compromise: expressions of gratitude don’t require a reply, especially the call-and-raise response of thanking that person back, so just let it ride unchallenged or give a slight smile or nod. It’s all weird, of course, just like saying “goodbye” or “bye,” which originated as a shortened version of “God be with you,” which technically a non-believer shouldn’t be saying. I’m also intrigued that non-Texans are using “howdy” for some reason.

HIStalk Announcements and Requests

RIP Motorhead and Hawkwind singer Lemmy, who has died of cancer at 70.


A reader who wishes to remain anonymous donated $250 to my DonorsChoose project, which was matched by the Bill & Melinda Gates Foundation and then again by my anonymous vendor executive. That allowed me to fund $1,000 worth of teacher grant requests, all of which carried additional matching funds to stretch the donation value to fund $2,000 worth of projects:

  • Three sets of ear buds and wireless mice for Mrs. Steele’s kindergarten class in Huntland, TN.
  • Two programmable robots for Mr. Willet’s elementary school digital lab in Asheville, NC.
  • Five MP3 players to form a listening center so that Ms. Johnson can read books for her first grade class in Oklahoma City, OK, in which the student poverty rate is 100 percent and 98 percent are English Language Learners.
  • A Chromebook, case, six sets of headphones, and a wireless mouse for Ms. Johnson’s third grade class in Philadelphia, PA.
  • An iPad Mini, Apple TV, case, and display adapter for Mrs. Robles’ middle school math class in Phoenix, AZ. She replied almost immediately, “Oh my God! Because of you, all my underprivileged students will be beaming with smiles and their brains full of knowledge that they will be eager to engage in and learn. It is because of wonderful people like you that our children have equal access to success and in becoming someone in this world! The kids have had to deal with the lack of the proper tools to learn. This will definitely be a game changer. They will not feel left out in the technological world and will be super proud to come and learn in my room. Over 150 students will now feel part of a new era of learning.”
  • A laptop and Ethernet switch for a student-led project in which the West Covina, CA school’s robotic team will recruit new members by demonstrating their robots to fellow students and parents on Saturdays. As the students who made the request summarized, “This year, our robotics team won the 2015 Chezy Champs Competition and we are ready to win it again! Just like a football team, after high school seniors graduate, we have to rebuild the team. Without enough team players and support, we are at risk of losing our robotics program … With a new notebook and Ethernet switch, we will be able to showcase our previously built robots! We want to be able to show how exciting robotics is, and be able to present this without having any embarrassing hiccups.”


January 13 (Wednesday) 1:00 ET. “Top 5 Benefits of Data as a Service: How Peace Health Is Breathing New Life Into Their Analytics Strategy.” Sponsored by Premier. Presenter: Erez Gordin, director of information management systems, Peace Health. Finding, acquiring, and linking data consumes 50 to 80 percent of an analyst’s time. Peace Health reduced the time analysts were spending on data wrangling, freeing them up to create new actionable insights.

Contact Lorre for webinar services. Past webinars are on our HIStalk webinars YouTube channel.

Acquisitions, Funding, Business, and Stock

I took a look at how publicly traded health IT-related stocks fared in 2015 from best to worst. For the year to date, the S&P 500 was up less than 1 percent, Nasdaq around 7.5 percent, and the Dow down less than 1 percent.

  1. MedAssets: up 56 percent
  2. Nuance: up 43 percent
  3. Aetna: up 38 percent
  4. Leidos: up 34 percent
  5. Allscripts: up 21 percent
  6. UnitedHealth Group: up 19 percent
  7. Vocera: up 18 percent
  8. Cognizant: up 17 percent
  9. Athenahealth: up 13 percent
  10. Teladoc: down 8 percent (since its June IPO)
  11. Premier: up 4 percent
  12. Quality Systems: up 4 percent
  13. McKesson: down 3 percent
  14. The Advisory Board Company: up 3 percent
  15. Cerner: down 5 percent
  16. Imprivata: down 14 percent
  17. CPSI: down 17 percent
  18. Evolent Health: down 34 percent (since its June IPO)
  19. Castlight Health: down 64 percent
  20. Streamline Health: down 68 percent

Government and Politics


A new law that goes into effect this week allows CMS to fine insurance companies whose provider directories contain mistakes that can cause patients to inadvertently receive out-of-network care. California fined Anthem Blue Cross and Blue Shield of California last month after discovering that 25 percent of the doctors in their directories either didn’t accept their insurance or had moved, while Blue Shield has paid $38 million to cover out-of-network bills that were caused by its inaccurate doctor listings. Critics say the provider directories are full of doctors who are dead, moved, retired, no longer accepting insurance, or not accepting new patients. Insurance companies say directory management is a nightmare since doctors often don’t return their calls and 30 percent of them change affiliations in a given year. CMS originally required insurance companies to call every doctor monthly to verify their listings, but changed that to quarterly since as MGMA says, “The last thing physicians want is for hundreds of health plans to call them every month.”

Privacy and Security


This won’t help the argument for a national patient identifier: the TSA may stop accepting driver’s licenses issued by several states that refuse to comply with federal standards. Federal law requires states to check documents that verify the identity of applicants, equip the license with a chip or magnetic stripe containing the information collected, and to share information with other states and the federal government. The Department of Homeland Security wants to implement the $3.9 billion program to more carefully check travelers and to prevent identity theft, while critics say it’s the equivalent of a national ID card and the recent hack of the Office of Personnel Management raises concerns about storing too much personal information in one location.


Mainstream media have picked up on a Financial Times report that simply added up the number of hacked US medical record records for 2015 and reached the unsurprising total of 100 million, nearly 80 million of which resulted from the Anthem breach alone. FT repeats the hacker motivation in which a credit card record fetches only $1 on the black market, while a complete medical record is worth $2,000.



The first non-beta release of Google Glass will occur in mid-2016, says a newspaper that ran purportedly leaked photos of the device obtained from FCC filings. It will now be sold only to businesses under the name Google Glass Enterprise Edition, available only from companies that will pre-load their software on it. Features include a sturdier hinged design, an external battery pack, a larger screen but at least one model that won’t include a screen at all, and eventually a clip-on model for people who wear glasses. Excited Glassholes who paid $1,500 for the previous version – most of whom abandoned it quickly due to limited functionality and unlimited public scorn — probably aren’t thrilled that the Glass development team now refers to their premature technology investment as “little more than a scuba mask attached to a laptop.”


St. Jude Children’s Research Hospital scientists develop ProteinPaint, a free Web application and dataset that allows scientists to analyze and contribute information on genetic mutations that cause pediatric cancer.


An interesting article questions the AMA’s interest in requiring competency testing for aging physicians. Some experts say evidence is scant that older doctors are less competent or less likely to follow modern standards and therefore any new competency testing should be applied to all doctors. This is a brilliant quote: “It’s a growing concern now that 26 percent of active physicians in the US — about a quarter million docs — are over 60. Fears they will soon go running for the exits and create a physician shortage are competing with fears that they will stick around forever and create a quality performance gap.”

In Pakistan, a government official angry at the IT department of a local hospital gives it until February 15 to go live with its computer system after the project was delayed for five years.


The $1,000 per pill hepatitis C drug Sovaldi costs only $4 in India after Gilead Sciences licenses 11 India-based companies to produce generic versions that aren’t available here. You’re welcome, India (or should that be “no problem?”) That nicely illustrates how product pricing that would be entirely reasonable in every other industry (charge whatever people are willing and able to pay) is infuriating when being an un-wealthy citizen of a purportedly wealthy (but deeply in debt) country means you can’t afford to get something that would make you healthier.


Researchers find that contrary to perception, Britons have better teeth than Americans, mostly because they have access to publicly funded medical and dental care and we don’t. We’re mid-pack in global dental health, which is a lot better than we fare in overall health in every category other than spending.

A senior manager at a company that specializes in “changing health behavior” (meaning being paid to push paid advertising at doctors) urges colleagues that “we must rely in EHR technology to capture data and use it to target our messages effectively … Our promotion can be just as successful as [wrestling promoter] WWE.” You can bet that sort of nonsense will neither raise physician EHR satisfaction nor lower US healthcare costs, but the fact is, it works, because doctors aren’t nearly as smart as they think in resisting the siren song of billion-dollar industries willing to do anything to wrest control of their prescribing pen or keyboard.


It’s puzzling to me why some experts – doctors, CIOs, and health IT people – seem to structure their entire professional lives around Twitter and Facebook as though whatever they do there constitutes a professional accomplishment worth including on their LinkedIn profile. As evidence, note the unconvincing “7 Social Media Platforms Every Urologist Should Use,” which suggests that “it’s becoming essential for every healthcare professional to cultivate an online presence” and adds that following lame conference tweets is as good as actually attending. The author says every urologist should use Facebook, LinkedIn, Doximity, Twitter, Figure1, Instagram, and Periscope. I think it’s probably an uncommon urologist whose social bleatings would prove entertaining or informative, so perhaps the blanket recommendation that all of them take to the airwaves should be tempered with the reality that not all of them are well suited for it. Self-proclaimed “King of the Urology Twitter World” Ben Davies, MD  (@daviesbj) is an obvious exception, although he shares stuff that patients might not need or want to see.


Mr. H, Lorre, Jennifer, Dr. Jayne, Dr. Gregg, Lt. Dan.

More news: HIStalk Practice, HIStalk Connect.

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December 29, 2015 News 10 Comments

Morning Headlines 12/29/15

December 28, 2015 Headlines No Comments

At Theranos, Many Strategies and Snags

Pulitzer-prize winning investigative journalist John Carreyrou recaps the fast paced rise and fall of Theranos in a year-end Wall Street Journal article.

Why Preventing Cancer Is Not the Priority in Drug Development

The New York Times investigates how the FDA and US patent system work together to inadvertently discourage preventative and early-stage cancer treatment research, while encouraging late-stage treatment research. The article builds a case arguing that “There’s more money to be made investing in drugs that will extend cancer patients’ lives by a few months than in drugs that would prevent cancer in the first place.”

Obama administration’s proposed insurance reforms incite industry backlash

Several consumer protection provisions included in proposed rules governing 2017 ACA insurance plans have drawn criticism from insurance companies, including minimum provider network standards, and the introduction of “standardized options.”

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December 28, 2015 Headlines No Comments

Curbside Consult with Dr. Jayne 12/28/15

December 28, 2015 Dr. Jayne No Comments


I must have been very good because Santa brought me a new Microsoft Surface Pro 4 to play with. As much as Windows 8 gave me fits last year, the transition to Windows 10 has been just about seamless. I’m enjoying its small size and the touch screen even though it has run through a couple of upgrade cycles in the few days I’ve had it.

The only downside has been that I haven’t been able to get my Outlook .pst file to import into Office 2016. I’m not sure if it’s because I’m making a large jump in versions or because I’m going from regular Office to 365, but it’s going to be a non-starter if I can’t get it done before my next client engagement.

I can’t believe 2015 is coming to a close. It’s certainly been an interesting one, with lots of ups and downs for everyone. Many of us have bonded through the trials and tribulations of ICD-10, although more than a few people have expressed their happiness that they’ll likely be retired before another version of ICD goes into use.

Depending on how fast that becomes a reality, I can probably arrange to be in that category if I keep picking up extra shifts at the urgent care and invest well. I’ve spent so much time on the road this year that my living expenses have been lower than usual, so once I finish my taxes, I might be able to make a pretty good contribution to my nest egg.

I knew I had been on the road a lot since going the consultant route, but it really hit me when I started receiving the year-end summaries from my frequent traveler programs. I gained status on one airline and lost it on another – too bad we can’t use accumulated miles to buy our way up because I’d be able to keep status for a long time. I rarely use my free miles since I’m usually out with clients.

Since I was in quite a few smaller towns, I ended up splitting my hotel nights among three major chains, so I didn’t have enough nights at any of them to keep the highest reward tier. Two are merging, though, so we’ll have to see what happens with that. My favorite summary was from National Car Rental, which not only listed the number of rentals for the year, but also the total miles driven. I’m very glad I wasn’t putting that mileage on my own car!

Also in my mailbox were some year-end messages from vendors. Although most were of the folksy greeting variety (pine trees, snow, fireplaces) one was extremely salesy and seemed to have the undertone of a company desperate to meet quarter-end numbers. It probably would have been OK a month or two ago, but in the flurry of holiday niceties, it stuck out like a sore thumb. It wasn’t surprising, though, because this particular company has been in a relative tailspin for some time and constantly misses the mark on knowing its audience and managing social media and other communications channels. If you think this might be your company, I know some tremendously savvy PR people who could help if you’re interested in making a change.

Just for entertainment, I did a random sampling of the 100-odd pieces I wrote for HIStalk this year. There were definitely some consistent themes across the year, including data breaches far and wide and the push for interoperability. Hackers have also been big news, although it feels like they’ve been busier with other industries besides healthcare. Our harm is more likely to be self-inflicted although no less alarming. If hackers decide to consciously target healthcare rather than banking or other industries, it’s certainly going to be a wild ride.

There was also a consistent theme of market consolidation through vendor mergers, acquisitions, and closures. That can often be bad news for physicians and hospitals, although I suppose it could be a good thing if you have a bad vendor and are the kind of group that has to be pushed in order to jump.

Even among customers that aren’t struggling, there have been quite a few de-installations and it’s obvious that Epic will continue to dominate in the large health system space. My former employer is knee deep in migrating to a single vendor system and I enjoyed catching up with some of my old colleagues last week. The project is already behind and over budget in the first year after contract signing with the first go-live being almost a year in the future. It should be interesting.

Other big news included the repeal of the SGR payment system through the so-called “Doc Fix” bill. In addressing other new payment models, it’s going to add complexity for many customers and vendors who will have to add code to address new requirements and the need for additional robust reporting around shared risk arrangements. Less-prominent government-driven news included reporting from the Open Payments law, which is still less accurate than needed, but a good start.

The end of 2015 also saw the final state approving e-prescribing of controlled substances. Although it’s legal in all 50 states, that doesn’t mean it’s well-adopted. Most of my clients don’t have it live due to lack of pharmacy participation, but maybe we’ll do some projects around that in 2016.

In consumer news, the topic of whether wearables have peaked was fairly big news, as was the rise and fall of Theranos. The latter should continue to be an interesting topic in 2016 and I expect we’ll hear more tales from the inside as some of the investigations continue.

Interoperability was a huge buzzword and there has been a lot of push around it, but I’m not sure it’s making a huge difference in the lives of the average physician unless you’re just referring to being able to see data across your entire health system or hospital platform. I’m certainly not seeing competing hospitals doing any data sharing at all and it looks like RHIOs and HIEs are on their deathbeds in some parts of the country.

This year gave me several things to celebrate, including being able to practice my way from multiple part-time and locum tenens gigs to a steady one working for people I not only respect, but have a lot of fun with. Their decision to opt out of the Meaningful Use program (and the subsequent removal of many time-consuming and sometimes useless clicks from the EHR workflow) was one of the highlights of my year. I also made it to AMIA and caught up with old friends, made some new ones, and learned a few things along the way.

This is the close of my fifth year writing for HIStalk, which has been a tremendous experience. It seems like just yesterday I was sending Mr. H my humorous “Top 10” list of reasons he should hire me. It’s been exciting to watch us grow beyond the blogs to hosting webinars and supporting the next generation through the DonorsChoose projects. I’m looking forward to another year of healthcare IT news and opinion.

What are you looking forward to the most for 2016? Email me.

Email Dr. Jayne.

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December 28, 2015 Dr. Jayne No Comments

20 Top Stories of 2015, 20 Predictions for 2016

December 28, 2015 News 3 Comments


It’s not too hard to choose 2015’s big stories, but I’m annoyed by people who make obvious “predictions” that are intentionally vague enough to evade accountability, like psychics who boldly proclaim that their client will have “a change in fortune” or “family developments, some good and some bad” in hoping desperately not to lose business by being proved clearly wrong. My predictions will be specific and I’ll publicly recap them this time next year even if they make me look silly.

What are your predictions for 2016? Send them my way and I’ll list them here.


  1. The Department of Defense chooses the team of Leidos, Cerner, Accenture, and Henry Schein for its $4.3 billion EHR project.
  2. High-flying Theranos and Turing Pharmaceuticals go down in flames, at least temporarily.
  3. NantHealth continues its acquisition streak and PR push, but temporarily shelves its IPO plans.
  4. ICD-10 finally goes live with barely a ripple thanks to the in-the-trenches folks who modified systems to accommodate it.
  5. The Supreme Court upholds the Affordable Care Act, but poor-performing state exchanges, increased insurance company costs, and increasingly higher deductible and narrower networks leave the middle class footing the bill for a bold experiment that has mostly helped providers gain paying patients without improving overall health.
  6. Just about everybody pushes back on Meaningful Use Stage 3, either by complaining to Congress or exiting the program, and doctors increasingly say their EHRs are the top source of their dissatisfaction.
  7. Industry mergers increase dramatically at all levels – health systems, health IT vendors, drug companies, and insurance companies.
  8. Epic CEO Judy Faulkner pledges to donate her multi-billion dollar fortune to a charitable foundation upon her death or direction.
  9. Epic and Cerner continue to dominate the inpatient systems market at the expense of their only significant competitor, Meditech.
  10. Data breaches become commonplace, including hackers who accessed the identities of 80 million people associated with Anthem.
  11. Cerner completes its acquisition of the former Siemens Health Services, but sees its financial results tarnish slightly immediately following.
  12. Athenahealth acquires software from RazorInsights and Beth Israel Deaconess Medical Center as it increases its push into the inpatient market.
  13. CVS and Walgreens continue to lead health IT with innovative apps and services.
  14. Epic wins several impressive customers, but struggles in the UK, loses the DoD contract, and will be displaced with Cerner following Banner Health’s acquisition of financially strapped University of Arizona Health Network.
  15. The OpenNotes project to allow patients to review clinician documentation gains ground with positive study findings and new funding.
  16. Expectations increase for the FHIR standard as the best way to integrate EHR information with other systems.
  17. ONC releases its Interoperability Roadmap that calls for EHR vendors to expand their API support and for the government to streamline privacy and security policies.
  18. Mobile apps show considerable promise for diagnosing and monitoring mental health conditions, especially depression.
  19. Apple announces ResearchKit for clinical study enrollment.
  20. Major healthcare systems and payers pledge to migrate most of their business to value-based payments by 2020.


  1. The cooled-off IPO and funding markets will leave nearly all of the unprofitable startups that graduated from the overabundance of accelerators and incubators in the past few years struggling to gain or maintain momentum and customers. Companies with IPO intentions will postpone their plans due to market conditions, but Health Catalyst will do so anyway with decent but comparatively unspectacular initial share price results as wary investors wait for a couple of good quarters to convince them.
  2. Healthcare costs will become a contentious topic in the 2016 presidential elections as the millions of Americans who purchased health insurance are stung by low utilization and high costs due to high deductibles and co-insurance, leaving them both poorer and less healthy than before. Medical bankruptcies will increase significantly and hospitals in particular will find it difficult to collect the money owed by under-insured patients. At least one presidential candidate will timidly suggest cost controls – both provider and pharma – as the only remaining option in trying to manage the increasingly damaging costs of healthcare in the US. Provider mergers will continue and national brands such as Kaiser Permanente that combine insurance and care delivery will gain prominence.
  3. Consumers will lose interest in fitness trackers and wearables as 2015’s Christmas presents gather January dust just like they did last year.
  4. The CEOs of Epic, Cerner, and Meditech will start to pull back from day-to-day company involvement as they approach retirement.
  5. ONC and Meaningful Use will become increasingly less relevant and more contested as ONC replaces Karen DeSalvo with a new National Coordinator who lacks her experience and bipartisan support.
  6. Several mid-tier consulting firms will be downsized or acquired as their implementation and advisory business dries up.
  7. At least three big health systems will experience a data breach that results in exposure of the information of 100,000 or more their patients. The industry will realize that collaboration to identify and mitigate breach threats is essential and of mutual benefit. The government and organizations such as HIMSS will attempt to create and manage an information sharing and risk assessment platform.
  8. The VA will announce plans to eventually replace VistA with a commercial product. Congress will push Cerner since the Department of Defense will be implementing it, but the VA will favor Epic just to be different.
  9. At least one Epic and Cerner customer will switch to the other company’s product in trying to get a better deal on crippling software maintenance fees. Epic will also expand its hosting service to compete with Cerner’s successful offering.
  10. The terms “telemedicine” and “mobile health” will become antiquated as they simply become another accepted aspect of care delivery. “Information blocking” will also fade away as a hot term when everybody realizes the concept involves speculation without proof, but consumers will increasingly demand that their providers share their information – both with their other providers and with themselves – without charging per-page fees for information that exists in electronic form.
  11. IBM Watson will continue to produce mostly hype. No convincing studies will demonstrate its value, but newly announced, high-profile partnerships will keep IBM shareholders hopeful.
  12. The dark horse publicly traded company best positioned to succeed in health IT and related areas without a lot of fanfare will be Premier.
  13. Athenahealth won’t get much inpatient traction with the former RazorInsights and BIDMC’s WebOMR.
  14. McKesson will consider packaging and divesting its many health IT offerings as non-core business.
  15. Epic will not join CommonWell, but will leapfrog its competitors in offering APIs and slowly building a carefully controlled third-party ecosystem.
  16. Software for population health management and analytics will enter Gartner’s Trough of Disillusionment as providers implement it poorly and without a commitment to truly change their profitable business models.
  17. Cerner and Epic will continue to poach the business of Meditech, CPSI, and best-of-breed vendors whose small-hospital customer bases are being acquired by larger health systems.
  18. “Big data” will support a few meaningful clinical studies performed using only aggregated electronic information, but “little data” will provide more impressive but less-publicized results as doctors design the treatments of individual patients by reviewing the outcomes of similar patients.
  19. Consumer healthcare apps will continue to be plagued by inconsistent use, questionable design, and an unremarkable impact on health or outcomes.
  20. CHIME and AMIA will follow the HIMSS model of increasing conference attendance and revenue by catering to high-paying vendors willing to buy access to prospects.


Mr. H, Lorre, Jennifer, Dr. Jayne, Dr. Gregg, Lt. Dan.

More news: HIStalk Practice, HIStalk Connect.

Get HIStalk updates.
Contact us or send news tips online.



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December 28, 2015 News 3 Comments

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