Category Archive For "Healthcare"
The ultimate goal of AngelMD is to facilitate improved outcomes for startups, investors, and ultimately for patients. Today we are proud to share the news that Saranas, an AngelMD portfolio company, has obtained FDA clearance for its Early Bird Bleed Monitoring system.
A recent study of over 17,000 large-bore transcatheter interventions showed that nearly one in five patients experience a bleeding-related complication. Saranas’ novel early-detection system addresses an unmet need for real-time detection and monitoring of these problems. The company’s last funding raise, in which AngelMD was also a proud investor, allowed for Saranas to submit the De Novo application to the FDA and launch a multi center clinical pilot within the United States.
Saranas originated from the Texas Heart Institute at the Texas Medical Center. Its goal is to provide real-time monitoring without the need for radiation, and at a lower cost than the status quo.
The Early Bird Bleed Monitoring System is now being piloted across multiple centers to assess its versatility, and to increase patient safety. The company plans to launch the system commercially in selected centers across the US.
If there has been one overarching theme over the past few years, it is that healthcare delivery systems are consolidating at a stunning pace. As Kaufman Hall reported in January of this year, the average size (in revenue) of the sellers in M&A deals has grown at a compounded annual growth rate (CAGR) of 13.8 percent since 2008. That is to say that, not only are more deals happening, these deals are worth an ever-increasing amount of money.
A more recent trend has been the “merger of equals” when it comes to healthcare consolidation. We’ve seen this in deals like Baylor/Scott & White/Memorial, as well as with Carolinas/UNC, and with Advocate/Aurora. These deals raise all new opportunities for management teams to capitalize on areas of revenue and expense that synergize between the companies.
To further complicate matters, names like Amazon and Apple are now commonplace in healthcare. Cigna’s acquisition of ExpressScripts, CVS acquiring Aetna, and Optum swallowing DaVita are all prime examples of how consolidation is reaching across the industry.
For many startups, and even to investors, this culture of consolidation can lead to uncertainty. It is critical that these companies and their investors have the tools at hand to identify transformative technologies. Ultimately, we’ve built the AngelMD network to be the vehicle by which this identification happens. But reaching even further, the healthacare industry as a whole can rely on AngelMD to be a litmus test for new technologies that can fuel its growth.
How, you might ask? The answer itself is simple. Getting the pieces to work together is the challenge that we meet every day.
Above all else, it’s the network. Our ever-growing base of physician/investors is the ideal network to rapidly identify, score, invest in and advise the very best in healthcare innovation. These members are, more often than not, in senior clinical leadership roles and they are working inside of this rapidly-consolidating landscape. The benefit here is two-fold:
These positions provide a critical level of access which can shorten the startup evaluation process.
Health systems CIOs can leverage the AngelMD network and our Metis AI engine to identify the innovations that best align with the needs of their organization.
For AngelMD, the consolidation of the healthcare industry simplifies the process of identifying potential exits for the best healthcare startups. With over 1,000 startups on the network, we are already pulling from one of the deepest benches in healthcare. Combine that number with our Metis scoring engine and the industry could source the very best ideas that compliment their portfolio while driving revenue growth.
In short, AngelMD is working toward the future. Consolidation doesn’t have to be a scary practice. With the right information, it can be a boom rather than a bust for healthcare startups, their investors, and the companies that buy them.
As the parable says, the road to hell is paved with good intentions. The healthcare IT (HCIT) segment is suffering from a meaningful use hangover that has been created by our government’s best intentions. The goal was to improve care delivery in the United States. The method was to provide incentives for using HCIT — most notably electronic health records (EHRs). The end result? Almost any physician will tell you, we’re caught in EHR hell –a net negative impact on cost, quality, and deliverability of healthcare.
How Did We Get Here?
First, a history lesson: EHR adoption in the US healthcare market had, historically, been quite slow. This was a multi-faceted problem that touched on changing the behavior of physicians, issues with interoperability, and of course the associated expenses of moving to an EHR system. The US government committed $27 billion inside the HITECH Act of 2009 to support adoption of “meaningful use” of EHRs. The idea was that incentivizing the use of EHRs would lead to faster adoption and overall better care for patients.
The HITECH act was successful in unnaturally accelerating the adoption of EHRs through financial incentives. Health Affairs published an abstract in August of 2017 that found annual increases in EHR adoption rates among eligible hospitals went from 3.2 percent in the pre-period to 14.2 percent in the post-period. Ineligible hospitals experienced much smaller annual increases of 0.1 percent in the pre-period and 3.3 percent in the post period, a significant difference-in-differences of 7.9 percentage points.
The End Result
By September of 2018, more than $24.8B in HITECH incentive payments had pushed EHR adoption forward without the expected positive impacts on cost and quality of care delivery.
“Since its inception in 2011, the MU program has been criticized more than praised by practicing physicians for increasing non-value-added work during patient encounters,” said authors of the study, which was published online in the January issue of the Journal of the American Medical Informatics Association.
“In recent years, increasing negative sentiment has led to a range of commentary comparing physicians to highly paid data entry clerks and mocking the MU Program as ‘meaningless abuse,'” they wrote.
American Academy of Family Physicians (AAFP) published a study in February 2018 attempting to quantify the impact of meaningful use on physician practice. Their summary finding revealed the following:
“Roughly one-third of MU criteria were perceived as useful in less than 50 percent of patient encounters, which means that time is taken away from typical patients for these non-value-added tasks (i.e. system waste) that must be performed for compliance.
Hence the policy becomes a burden on the quality of care that physician can provide to their patients. In total, these findings provide insight into CMS’ comment that MU has ‘lost the hearts and minds of the physicians.'”
While it’s easy to quantify the results (or lack thereof) of the Meaningful Use incentive program, its public perception is perhaps even worse. In fact, CMS went so far as to change the name of the program in April of 2018. It is now known as Promoting Interoperability.
The hangover phase, which follows the stupor from nearly $25 billion in incentivized spending, now has buyers of HCIT solutions wary. If billions of dollars in incentives couldn’t do much to move the needle of patient care, how can they be sure that any of the promised benefits are real? There is now a slowing in adoption, and many health systems have even experienced increased operating expenses as a direct result of their EHR implementation.
Hope for the Future
That is not to say that all is lost. The delayed gratification for government’s investment could ultimately come through the application of artificial intelligence (AI) and machine learning applied to the codified data creating through the meaningful use standards. These learnings in combination with the genomic makeup of individuals holds the promise for personalized treatments responsive their genetic makeup, demographic and psychographic characteristics. AI and machine learning will become a key decision support tool for physicians when making treatment decisions.
The meaningful use hangover may ultimately result in a greenfield of opportunities as AI and machine learning are applied to the vast longitudinal data sets gathered through the technology choices mandated through HITECH.
I started this week at home in Nashville, attending the Health:Further conference. This year, it seemed to me, that there was an overarching theme that I will call “the rules of healthcare innovation.” AngelMD President Dan Parsley and SVP Mark Mescher were both speaking, so it gave me a good opportunity to attend some talks, panels, and one-on-one meetings. These are the topics that I heard, time and time again.
Innovate Where You Are
While talking to investors, one thing almost all of them said was that they wanted to see innovation led by founders within their own areas of expertise. It’s a sentiment that was echoed by AngelMD Lead Investor Dr. Suzanne Manzi in her interview last month.
“I’ve seen promising companies, but sometimes they’re run by people who don’t have experience in the market that they’re trying to enter. They can have a great product, but the odds are stacked against them if they lack the background.”
It’s easy to look around and see frustrations within the healthcare world. For the entrepreneur, these frustrations look like targets for innovation. But the sad fact is that, often times, the innovation target is far removed from the entrepreneur’s area of expertise. This leads to inexperienced, poor decisions, and oftentimes to unnecessary failure.
The Wisdom of the Crowd
With the first point in mind, clinician-entrepreneurs must also be careful to not be overly sure of their own expertise. There will be times when something bothers you personally, and you think that there’s a better way of doing things. But that doesn’t mean that anyone else is having the same problem.
The quick way around this pitfall is to survey the wisdom of the crowd. Talk to other providers in your specialty. See if they’re having the same frustrations that you are. Ask them what they’ve tried in order to get around those frustrations.
At AngelMD, part of our secret is in the power of the network. We make it easy to connect to other healthcare providers in your field, so take advantage of that opportunity. This is especially important for those who work in smaller geographic areas, or less-populated specialties. Use your AngelMD profile to connect to others, ask them for their feedback, and put the crowd to work for you.
I shouldn’t have been surprised to hear Marcus Osborne from Walmart talking about wellness innovation, but I was. My jaw shouldn’t have dropped when I heard HCA’s stats surrounding innovation, but it did. Over and over again, I heard stories about large organizations placing bets on innovation. Companies are putting big money into innovation — especially the kind that solves their own problems.
We often hear stories about the person who slogs through their 9 to 5 job, then heads home to pursue a passion. These days, those stories are changing. Companies that you might not expect (look back at the first paragraph, and notice that I said Walmart) are tapping current employees and hiring new ones, in order to drive innovative solutions within healthcare.
This shift in culture is opening new doors. In some cases, it’s placing doors where they never existed before. Instead of looking to outside vendors, many companies are willing to put down table stakes in order to be a player. So before you go looking around, or spending late nights on your own, investigate the opportunities that already exist inside your organization.
There Are No Rules
It might seem strange to end a post about rules by saying that there are no rules, but hear me out for a final point. The fact of the matter is that the world of healthcare has changed. Innovation is coming from every direction, and the only thing set in stone are the regulations that govern all of us.
Innovators have spent years being constrained by what others have told them they can’t (or shouldn’t) do. But today’s landscape is much different. Age matters less than it ever has, experience is less difficult to gather than ever before, and the connected world that we live in means that global collaboration is a simple reality.
If Health:Further taught me any one thing, it’s that there is not only a need, but also the means, to bring about the future of health. So stop waiting for someone to give you permission. Build something, advise someone who is, or invest in those who have. The world of innovation is ours.
Focus on innovation in healthcare is accelerating. More funding, engagement from large organizations, and speedier FDA processes are all contributing to this boom. For many physicians, standing on the sidelines is not enough. They want to participate in the entrepreneurial economy and experience the adrenaline associated with innovation. There are a variety of paths that can lead to helping shape the future of the industry.
Why Should I Get Involved?
Ultimately most physicians get involved, at least in part, because they want better patient outcomes. Physicians are seemingly always on the lookout for new and innovative ways to provide better outcomes. As someone who helps to contribute to these innovations, physicians can take a much more hands-on approach to the success of new ideas.
Beyond the obvious, however, physicians can help to speed up the development of products and services. We know first-hand what our patients need, and how best to treat them. We’re familiar with regulatory processes, and in some cases we’re already working with entities that are championing innovation.
One area that is often overlooked, is the fact that we hold the ability to guide companies in their missions. Almost every idea iterates many times over the course of a product’s life. When this happens, it’s easy for companies to lose sight of their greater mission and to put their entire focus onto the product. As physicians, we work every day with a single goal in mind — provide a better life for our patients. When we enter the innovation process with this same mindset, we can make suggestions to the companies that help them correct their course.
How Do I Get Involved?
As mentioned before, there are different paths that a physician can take to contribute to innovation in healthcare. The roles of physician entrepreneur, trusted advisor, specialty consultant, or investor are all viable.
The role of the physician entrepreneur is certainly not new. As long as there have been doctors, there have been doctors finding new and better ways to work. Dr. Billy Cohn of the Center for Device Innovation (J&J) is a prime example of how physicians can balance their daily work while contributing to innovation. While maintaining a practice, he amassed over 90 patents either granted or pending. Many of his devices, some of which started with prototypes pieced together from hardware stores, have made significant impacts on the world of cardiology.
Physician entrepreneurs have a strong understanding of clinical fundamentals. This helps them to address their areas of concern with efficiency and focus that entrepreneurs of different backgrounds may not have. That said, there is still an opportunity cost associated with pursuing innovation. But physician entrepreneurs are often a good candidate for being able to manage side projects.
The American Medical Association has even gotten behind the idea of physician entrepreneurs. Its Physician Innovation Network (PIN) aims to connect physicians and entrepreneurs. This comes after a push over the past few years to encourage more physicians to take the entrepreneurship leap themselves.
Advisors and consultants also play a critical role in the world of innovation. As an advisor, the physician can help to spot problems for the company before they arise. They generally serve as a long-term part of the team, and they are often compensated for their time — usually through equity with an occasional honorarium/retainer.
Consultants are the specialists of the innovation world. Startups, physician entrepreneurs, and even established companies call on the expertise of consultants to solve specific problems. This means that consultants often have shorter roles with a company, but they can be very additive to the success of a company.
In addition to earning sweat equity, a lot of physicians have learned to invest in what they know. The same qualities that make us prime candidates for advisors and consultants contribute to strengths as investors. We know our areas of expertise better than anyone on the outside, we’re well aware of the processes around regulation, and we understand how regulations play into bringing a product to the mass market.
It is important for physicians to also be aware of what they don’t know. AngelMD is helping to bridge the knowledge gap between your practice and your first investment. By drawing on the wisdom of professional investors and other physicians who have already invested, AngelMD allows for better outcomes for everyone involved.
The physician investor does have some pitfalls to navigate. Conflicts of interest are always a concern, but a little care ensures these issues are avoided. Once more, this is where having a network of people with expertise is critical. The network can help answer and avoid potential problems, while empowering them to make smart decisions to help shape the face of healthcare innovation.