Healthcare-Unbound-2007

Jay Srini, VP, Emerging Technologies, UPMC and Vince Kuraitis, Principal, Better Health Technologies, opened the conference.

Srini provided an update on the demographic tsunami represented by the aging population. Statistics show health care prevention has not worked. Over the last 10 years there has been a steady increase in obesity and diabetes. This is not because we're unaware or have not tried to do better. Lifestyle changes are the biggest impact on health. In fact, the extra weight people are carrying has cost the airlines extra in transporting passengers. Diet is the most critical factor that impacts health. Smoking and drinking also came in for some finger wagging.

Jay asked, “When we know there are preventable costs, can we declare we can't afford to insure everyone in the country?” The cost for obesity related care rose from 2% in 87 to 11.6% in 2002.

Every day, almost 11,000 boomers turn 50. Geez, that's depressing.

The (same old) bottom line is that health care delivery must change in the future as patient demand increases and resources (physicians, nurses, money) shrink or remain limited.

The solutions to our problems is in the boundaries, asserted Jay.

When he came up for his co-chair keynote, Vince Kuraitis asked, “How close are we to a tipping point?”

His theme: an individualists or group effort approach to health care?

First off, Vince explored the network effect and HU markets. Showing the classic hockey stick market adoption model, Vince referred to the fax machine as an example of the network effect. One fax machine is worthless, two has some value. But when you reach a critical mass (usually about 20%) the value of owning an individual fax machine increases substantially.

Four years ago Forrester published their $34 billion market forecast for Healthcare Unbound, and predicted the market entering a rapid growth phase in 2009 (just 2 short years away). The critical assumption was that payors would adopt HU, after some experimentation and proving out the value of HU. The market segments in the Forrester model are assisted daily living, or elder care; chronic disease management; and post acute care (including hospital at home).

How close are we to a tipping point? Right now we're just a sexy combination of very interesting companies that get nice stories on the evening news and start ups.

No sightings here – overall, HU has generated disappointing adoption. EHRs, telemedicine and some niche applications are getting some traction. Reimbursement remains absent. There is no network effect in sight here.

Vince-Kuraitis,Mike-Barrett,David-Kibbe

Where are we likely to see hyper growth or tipping points? Remote patient monitoring technologies could reach a tipping point in 2008. The work being done by Continua is addressing one of the biggest barriers to growth – the lack of interoperability between devices and systems. [But according to the report that David Whitlinger gave later in the day, next year is probably a couple years too soon.] Vince also described the realization that plug and play interoperability is required to provide the affordability and ease of use required for broad adoption.

The participants in remote patient monitoring come from two perspectives, conventional medical device vendors and consumer electronics companies. Medical device vendors think high prices (say $8,000 for a remote patient monitor) and a proprietary end to end solution are a good business strategy. Consumer electronics companies are more interested in selling hundreds of thousands of less expensive devices – and not having to build complete end to end solutions – than in selling a few tens of thousands of $8,000 monitors. They want interoperability to drive drive rapid market growth and adoption.

Other challenges remain with IT/integration, reimbursement, developing viable business models, and licensure – so physicians can operate across state lines.

Next Vince launched into his assessment of the disease management (DM) market. One year ago, it looked like Medicare DM was approaching a tipping point. Today, it's back to square one based on initial results of their demonstration projects. Medicare Health Support (MHS) appeared to be the favorite son demo to expand DM into Medicare. Medicare is testing a fairly narrow section of DM, the frail elderly. The winners of the MHS were a few of the largest established DM companies.

There has been no evidence of positive short term financial results and virtually no evidence of success. So it's back to the drawing board for CMS and the industry. If we're going to test narrow concepts, there are many other narrow slices to be tested. This will delay hyper growth by several years.

The early results of the MHS indicate that we need much greater integration between DM service providers and those providing direct patient care. Another approach is a Medical Home model that includes a fee for providers to provide HU to patients in their home.

Vince has spent a fair amount of time trying to figure out what Google's doing – and it relates to personal health records. In fact, Vince asserted that personal health records could be a real sleeper in the HU market. There are two models for PHRs, a personal PHR that the patient completes and maintains themselves, and one that's tethered to an employer, health plan, or provider. The problem with a personal PHR is that the vast majority of patients are not motivated to actually complete and maintain a PHR. The problem with a tethered PHR is trust (of your employer or health plan), the quality of data (claims data is not clinical data), and interoperability (can you take your PHR with you?). The market here is very fragmented, and there are only about 2 to 2.5 million of patients with their own PHR.

The first generation of PHRs were thought of as an application, an on line repository of personal health information. The next generation is the PHR as platform rather than an application. This platform provides a repository of data combined with interoperability for other applications. The formulation of genetically specific drugs for a patient was one example of how data in a PHR (in this case genetic information) could be used by an outside application to create a result (documentation about the personalized drug) that goes back in the patient's PHR.

Google Health is the next generation of PHR. This is the result of Vince's detective work and reading of tea leaves (you can read more about Google on his blog, here and here; a related post on Medical Connectivity here). The current structure for your PHR is data that's scattered everywhere. Nor is that data in standardized formats suitable for a global information economy. Google Health's model is patient centered where consumers own their own personal health data – they have complete control, not physicians, payors or drug companies. Each patient will have their own personal health URL (e.g., http://health.google.com/timgee) Also needed are automated data mechanisms to gather and store PHI. They will go to drug stores, clinical labs, etc., and they'll aggregate this data for patients. [Later during cocktail hour, someone suggested a Google spider initiated by and authenticated to an individual that would have the permissions to automatically extract data from a myriad of sources – say prescription history from a PBM, or results from a regional reference lab.] They will use XML and the Continuity of Care Record (CCR) standard. They'll provide a user interface for patients, providers and payors to use. They'll also have to provide security and confidentiality. And ultimately, they'll create some value added service (hopefully something besides online Canadian drug stores or male enhancement ads).

If we had a platform like Google Health to plug into to support HU applications and products, this would hasten market development.

One of the biggest tipping points of all is in mobile health technology. Qualcomm and Partners are launching a private branded virtual wireless carrier to target wireless remote monitoring applications (more here and here). Health 2.0, or social internet applications and websites, are also likely to reach a tipping point in the near term. “Hospital at home” (HaH) is something that's been used a great deal in Europe and other countries. The key here is that current HU technology and applications begin to make HaH possible.

How do we know HaH is the biggest HU market of all? He offered the Willie Sutton theory of HaH – because that's were the money is. If projected 2014 annual hospital costs are estimated to be $1.14 trillion, and the projected HU market at 2015 is $34 billion, Vince suggested that we're underestimating the opportunity for HaH.

Our success in HU is tied at the hip to HIT interoperability and making PHI transportable. There needs to be integration with local care providers. He asked the question, “Are PHRs the best candidate for a common technology platform?” It's not whether, but when HU succeeds.

Vince encouraged attendees to support the Continuity of Care Record and to join Continua. The conventional medical device business model approach to the market should be abandoned (you know, those expensive proprietary end-to-end solutions) for one that leverages standards to provide interoperability and some level of commoditization to grow the market for everyone.

Pictured right is Vince Kuraitis, Mike Barrett and David Kibbe. Sorry I missed Jay Srini, I'll try to catch her tomorrow.

Be sure to check out other posts from this conference here.