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Matthew Holt

Health Plans mark it up and pass it on

May 27, 2008• 1

By Matthew Holt

Buried in a quick notice in BusinessWeek was this paragraph:

Health insurance companies have plenty of critics. Now they have one more: Leemore Dafny, an assistant professor at Northwestern University’s Kellogg School of Management. Insurers argue that because they compete against one another, they keep prices down, saving everyone money. Not necessarily, says Dafny in a March paper, "Are Health Insurance Markets Competitive?" Dafny looked at data from 1998 to 2005, provided to her by a benefits consulting firm, that tracked the behavior of 200 major companies to see whether they shopped around to find the cheapest insurers. Dafny found that when these big companies made more money, their insurance providers raised their premiums. But instead of dropping the carrier to get a better deal, Dafny writes, companies generally stuck with their health insurers and paid more. "Carriers can and do take advantage of a firm’s increased profits and extract higher prices from them," she says.

Here’s how this works:

Cerner immune to economic troubles, apparently …

May 27, 2008• 5

By Matthew Holt

Gathered at at hobnobbing summit in Tokyo, executives from high technology companies planned recently for economic troubles. And, apparently, troubles are mounting because consumers are running out of money, having to spend it on rising gas and food costs.

Virgin Mobile USA Inc (VM.N), the prepaid mobile phone service company, expects economic problems to last into the first half of next year for its mostly young customers.

Meanwhile apparently government spending isn’t guaranteed either.

Fujitsu Ltd (6702.T) Senior Executive Vice President Chiaki Ito said he was concerned that the costs of absorbing the crisis in subprime mortgages — the risky home loans that have gone bust for many U.S. and U.K. lenders — could divert government funds usually spent on technology." I am extremely worried about the indirect effects of the subprime problem," he said. Meanwhile, manufacturing faces risks from rising food and fuel costs. "If costs go up, this could trigger a recession," he added.

And even the ones that are doing well, such as IBM, are basing their success on infrastructure projects in the developing world.

"If I were in a business model where I needed double-digit growth out of the G7 to drive my performance, I would be in a cold sweat," said IBM Chief Financial Officer Mark Loughridge, referring to the Group of Seven nations.

But that’s apparently not the case in Kansas City, home of Cerner, the largest independent health care information technology company Indeed at their recent shareholders meeting Cerner’s two longtime leaders, Trace Devanny and Neal Patterson, said that things couldn’t be brighter.

Why such confidence? Either health care costs are going up very fast (from $2 trillion to $4 Trillion in the next ten years) in which case Cerner will get its share.

"The delivery of care and the spending around care delivery is relatively recession proof …," Cerner President Trace Devanny said. "There’s no way to slow down this train."

Or government will squeeze the health care industry, in which case Cerner will get more than its share.

Former U.S. Sen. John Danforth, a Cerner board member, agreed, saying the only way federal politicians attempt to rein in health care costs is by "putting the squeeze on providers." That will prompt doctors and hospitals to look for greater efficiency, which will make Cerner more valuable to them, Danforth said.

And not only is the U.S. market guaranteed, but foreign markets may also offer growth opportunities.

International business continues to account for a greater percentage of Cerner’s annual revenue, which hit $1.52 billion in 2007. Devanny said the company’s global revenue had grown tenfold to $290 million in 2007 from $29 million in 2002. "We hope to scare the daylights out of $400 million" in global revenue in 2008, Devanny said.

And even better, there is an open field in the relatively underserved ambulatory EMR market and other places

Cerner officials outlined several other areas of growth. They include expansion of Cerner’s core U.S. hospital market, where adoption of physician order entry software is still only 17.5 percent; the physicians office market; retail pharmacies; sales of aggregate patient data to big pharma companies and other clients; integration of care devices into hospital electronic medical record systems; and employer services, such as on-site clinics and regional health information exchanges that use Cerner software.

So what could possibly go wrong?

New in EMRs (chortle, chortle)

May 27, 2008• 3

By Matthew Holt

Here are a couple of sites worth a look. First, brand new EMR player Extormity. Second, the new standards accreditation body Seedie. Don’t forget to read the fine print.

A Google Health Clinical Exam

May 26, 2008• 3

By CRAIG STOLTZ

Not
one more pixel need be spilt about the issues of privacy, security,
HIPAA, metastatic data, third-party crashers, or corporate imperial
overreach raised by the debut of Google Health. Let’s just snap on the
latex gloves and do a quick exam. This won’t hurt a bit.

Three brief clinical observations follow:

Your conditions, your choice

You can enter your “conditions” either by entering text or choosing
from a disheartening alphabetic menu of bodily afflictions, from
Aarskog Syndrome to Zollinger-Ellison Syndrome. The list is 20 screens
by 3 columns deep when spread out on one endless page.

Immediately preceding the last entry is
“Zits”–a nice bit of diction that helps reach users where they live, so
to speak, to humanize the Google Machine. As with many conditions that
populate the picklist (no pun), there’s a pre-loaded search for zits.
But only certain conditions are pre-loaded with searches. Although
“whiteheads” was on the list, when I typed it in there was no stored
search. When I did the search myself up popped the zits search results.

To give the product a test run as you can see below I chose a number
of conditions from the list — WHICH, IF YOU ARE AN INSURER, EMPLOYER OR
ACQUAINTANCE, I ASSURE YOU ARE ENTIRELY MADE UP AND DON’T APPLY TO ME
AT ALL, IN FACT I AM PERFECTLY HEALTHY. I also tried to throw Brother
Google a curve ball by describing the same conditions using several
different terms, i.e., arthritis, osteoarthritis and bad knees. I was
permitted to add these as I wished.

Google Health beta — What’s really new and different?

May 23, 2008• 12

From his role as Director of Health IT for the AAFP, co-creation of the CCR and with his involvement behind the "NDA firewall" with the Google Health team, David Kibbe probably has a better vision than most about what’s new and different with Google Health. And he is indeed optimistic.

By David Kibbe

Much of the discussion about Google Health beta’s recent launch as an online PHR or healthURL seems to me to miss the point about what is really new and different.

Here’s how I see it:

1) Computability. What Google Health does that no other platform is yet capable of doing is to make personal health data both transportable AND computable. Right now, this is the news. By supporting a subset of the Continuity of Care Record (CCR) standard for both inbound and outbound clinical messages, Google Health beta makes it possible for machines to accept, read, and interpret one’s health data. It is one thing to store health data on the Web as a pdf or Word text file, for example one’s immunizations or lab results, where they can be viewed. It is a giant leap forward to make the data both human and machine readable, so that they can be acted upon in some intelligent way by a remote server, kept up-to-date, and improved upon in terms of accuracy and relevance. That is what the CCR xml subset supported within Google Health beta achieves for the consumer that is really new and different; this is what HealthVault and Dossia are to date missing.

Florida makes health insurance more affordable. Maybe.

May 23, 2008• 15

By Donald Johnson

Donald E. L. Johnson, a former editor and publisher of Health Care Strategic Management and a former editor of Modern Healthcare, has been writing about health care business, insurance, stocks and politics s since 1976 and has been blogging at www.businessword.com since early 2003.

If you’ve been uninsured in Florida for more than six months, you may be able to buy a stripped down health insurance policy
for as little as $150 a month regardless of your health status and
pre-existing medical conditions. But there are gotchas that could cost
you thousands and even bankrupt you if you get sick.

The new legislation is primarily aimed at people who can afford
health insurance but have chosen to be self-insured so they can spend
their money on something besides health insurance. Nationally, some 14
million people who can afford to buy health insurance don’t. They
effectively self-insure themselves against financially catastrophic
risks. Many become bankrupt after they require financially catastrophic
health care and can’t pay their bills.

In Florida, insurers will be able to offer policies that cover a lot
of primary care and preventive care services, the maintenance services
that you should pay for out of pocket and should not be insured. But
those policies may have onerous caps on payments for expensive hospital
stays and illnesses, according to a report by the New York Times.

To buy real insurance that covers financially catastrophic illnesses, consumers will have to buy optional coverage.

In other words, the new law enacted by Florida has authorized
insurers to sell savings accounts where they are paid to hold
consumers’ dollars until they need primary and preventive care. But
insurers can sell policies that don’t provide the catastrophic coverage
almost everyone needs sooner or later.

The NY Times reports:

The low-cost plans have to include preventive services,
office visits, screenings, surgery, prescription drugs, durable medical
equipment and diabetes supplies.

Some options offered by insurers have to include catastrophic and
hospital coverage. But an insurance company could, for instance, choose
to limit the number of days of hospitalization it will cover or place a
dollar cap on reimbursing certain services.

That makes no sense. Florida politicians have got it backwards. They’re
requiring insurers to cover routine maintenance and not the kinds of
medical care that put people into bankruptcy.

Why no e-Prescribing in the ED?

May 22, 2008• 1

By PAUL LEVY

As previously reported,
we have a wonderful system that permits doctors to order prescriptions
online, allowing patients to pick them up directly from their preferred
pharmacy. Recently a friend of mine went to our BID~Needham Emergency
Department, and came home with a script to get her prescription from
our pharmacy. So I inquired. Our ever helpful CIO, John Halamka,
explained:At present, e-Prescribing in the US is generally
limited to primary care practices and specialists who act as primary
care givers, i.e. cardiologists, ob/gyns, pulmonary docs, etc.
Massachusetts is the number one e-Prescriber in the country, yet only
13% of the routable prescriptions in the state go electronically. BIDMC
ambulatory clinics use it, and they are routing 35% electronically,
increasing every month.At BIDMC and BID~Needham Emergency
Departments, prescriptions are written electronically and printed to
tamperproof paper on laser printers in the department. To my knowledge,
there are no Emergency Departments in the state using e-Prescribing.
Here’s the challenge1. It is currently illegal to e-Prescribe
any controlled substance — pain killer, sedative, anti-anxiety drug
etc. Approximately 1/3 of all Emergency Department prescriptions are of
this type. Recently, the Massachusetts Department of Public Health was
able to get a DEA exemption to test one site (Berkshire Medical Center
using Meditech software) to e-prescribe controlled substances. The DEA
wants this to be a three year pilot , which illustrates how resistant
to change the DEA can be. I’ve just signed a letter along with many
health care standards and pharmacy leaders urging Congress to get
involved and accelerate the ability to e-Prescribe controlled
substances as a modification to Medicare Part D standards.

Penalties are like kissing your sister

May 22, 2008

By Matthew Holt

The LA Times said it best: John Terry’s late slip-up ruins night for Chelsea’s fans. Another perfectly good football/soccer match ruined by a penalty shootout. It used to be that important finals that ended in a draw produced a replay. Penalties were only used in tournaments when there was a need to produce a winner for the next round.
Now many, if not most, big finals are ended that way and it sucks.

It particularly sucks when the team I’ve supported since I was 5 — including all the way through the very lean years in the 1970s & 80s and long before any Russian billionaire bought it — finally gets to the European Champions League Final, and then loses on penalties. Especially when the player who is the local boy and the rock of the team misses the vital one.

So donât expect much cheerieness around here today!

American Cancer gets hip on uninsurance

May 22, 2008

By Matthew Holt

The American Cancer Society is focusing all its marketing budget this year on the issue of uninsurance and is trying to get the message out in new ways to new audiences. Here’s one using rap/poet MIKE-E.

Against Obama, polls show McCain lags on health care

May 21, 2008• 4

By Robert Laszewski

The latest Washington Post-ABC News poll on health care should give John McCain reason to be concerned.

The early May poll asked voters, "Regardless of whom you may support, whom do you trust more to handle health care?" The answer was Obama by 55 percent and McCain by 31 percent. And this poll was done a few days after his much publicized week-long health care tour.

McCain also did poorly on the other economic issues, although not as
badly. On gas prices, it was Obama 48 percent and McCain 28 percent. On the economy
in general, it was 48 percent to 38 percent.

McCain did better on the war on terror — 55 percent to 34 percent. The two tied over who would do the best in Iraq. It is still early and polls are notoriously unreliable this far out.
But my sense is that McCain has some big work to do on health care.