Sometimes when there’s smoke, there’s fire, and that was definitely the case with last week’s rumor that Oracle was in talks to acquire Cerner in one of the largest healthcare M&A moves of the year.
Database and cloud infrastructure provider Oracle is acquiring Cerner for $28.3B in a transaction expected to close in early 2022. Upon closing, Cerner will be organized as its own dedicated business unit, serving as Oracle’s “anchor asset” to expand deeper into the healthcare sector.
What does Oracle gain from the merger?
Cerner marks Oracle’s largest acquisition ever, with several key benefits justifying the move.
- Oracle and Cerner share a large overlap in end users. Cerner has access to an existing customer base in a giant market, potentially expediting Oracle’s pivot toward the cloud by leveraging these established relationships.
- Cerner is expected to be a source of durable revenue growth, with Oracle anticipating a positive earnings impact in the first year that is likely to accelerate as it expands Cerner’s services into new regions.
- As Oracle looks to push into healthcare, access to patient data will be a deciding factor of success, and Cerner’s EHR data helps eliminate its reliance on third party data providers.
What does Cerner gain from the merger?
Cerner was valued at close to $23B heading into the merger (vs. Oracle’s $280B valuation), and it will be looking to pursue ways to use its newfound scale to help it move past the EHR business that’s been slowly losing ground to competitors like Epic.
- Oracle’s resources, infrastructure, and cloud capabilities will accelerate Cerner’s pace of technology development, while its global footprint could also allow Cerner to reach new geographies faster than if it was a standalone company.
- Oracle’s hands-free Voice Digital Assistant will become the primary interface for Cerner’s clinical systems, reducing time spent typing and creating more time to care for patients.
- Cerner will move to Oracle’s Gen2 cloud with the goal of achieving “zero unplanned downtime in the medical environment,” a migration that should happen quickly because of previous integrations between the two companies.
If this strategy sounds familiar, it’s right from Microsoft’s playbook, with the tech giant acquiring Nuance for nearly $20B to add more clinical speech recognition tools while gaining a foothold in healthcare.
Cerner has been in the process of shifting its focus beyond its core EHR business, under the helm of David Feinberg, who left Google to become the company’s chief executive in October.
Feinberg has stated that improving usability and data analytics would be a critical component of Cerner’s strategy going forward, and the combination of Oracle’s Voice Digital Assistant and cloud computing capabilities could go a long way toward making this strategy a reality.
A new study published in Sage Digital Health found that at-home oxygen saturation monitoring helps identify early signs of clinical deterioration in COVID-19 patients, enabling them to seek appropriate care before the disease escalates.
- Methods – Stanford researchers recruited 49 patients with a recently positive COVID-19 test in the outpatient setting, preferentially selecting for those with underlying comorbidities. Participants were mailed pulse oximeters and enrolled in a symptom-monitoring app (AIRx), which provided a daily questionnaire for clinicians to review.
- Results – Of the six patients who required hospitalization, five sought care as a result of low pulse oximeter readings. Nearly all patients found the pulse oximeter useful, with 96% of those who did not require hospitalization reporting that the device gave them the confidence to stay at home.
- Impact – Keeping COVID-positive patients at home has the potential to reduce the spread of disease while preventing unnecessary strain on the healthcare system. The researchers recommend targeting this intervention at patients with a high risk for deterioration given the difficulty of obtaining and mailing pulse oximeters.
While there have been several studies on the effectiveness of remote patient monitoring for COVID-19, few have assessed the patient experience. Although this study is limited by its small sample size and selection bias, the high levels of engagement and patient satisfaction suggest that pulse oximeters could be a simple intervention for COVID-19 monitoring if implemented on a larger scale.
Patient engagement company Phreesia recently announced its acquisition of Insignia Health to help patients become more active participants in their care journeys.
- Phreesia provides services focused on “putting tools in the hands of patients to take on tasks,” ranging from scheduling to self-reporting social determinants of health. Each service is designed to make care more efficient through patient activation.
- Insignia Health holds the worldwide license for the PAM patient activation measure, which allows clinicians to quickly understand a patient’s ability to self-manage their healthcare. PAM is backed by over 700 peer-review studies and is the only measure of patient activation used by the NHS and CMS.
- PAM levels include “disengaged and overwhelmed,” “becoming aware but still struggling,” “taking action and gaining control,” and “maintaining behaviors and pushing forward.” Knowing a patient’s level allows care teams to cater treatment plans to individual needs.
- The acquisition expands PAM’s reach through Phreesia’s existing partner network. Insignia Health founder Chris Delaney stated that “the number of patients we can reach in a single week through Phreesia’s platform would otherwise take us months.”
Improving outcomes through individualized care is a top priority for any patient engagement company, and the Insignia Health acquisition gives Phreesia the license to the “gold-standard” of patient activation measures.
Owning PAM could generate additional revenue for Phreesia through licensing, but might also lead to Phreesia cutting back on the number of competitors that have access to PAM in order to strengthen its competitive positioning.
Direct healthcare provider Nomi Health recently closed a $110M Series A round to help advance the company’s mission of addressing care gaps, a huge sum for a company that got its start in 2019.
- Nomi currently serves 30k daily patients across 10 states, providing care for those that prefer not to go through traditional payor / provider channels.
- The company deploys mobile care units to locations such as universities and local businesses to deliver on-site services including vaccinations, COVID testing, and preventative screenings.
- The direct healthcare model allows Nomi to bypass many of the operational inefficiencies faced by larger incumbents, lowering overall expenses for recently added offerings such as COVID-19 vaccines and monoclonal antibody treatment.
- The latest funding will help Nomi deliver more services to “care deserts” such as rural areas and prisons, while also expanding its direct healthcare acquisition business.
Nomi’s Series A makes it the 63rd company to raise over $100M this year, although the size of the round is more in line with a Series C for a company further along in its life cycle.
The funding total not only reflects the boiling hot state of broader digital health investment, but also the size of the market that Nomi has set its sights on.
Expect some acquisition news from Nomi in the near term – $110M is a large war chest, and when they’re done picking up vans, they’ll likely add some competitors to their Christmas list.
While we publish new telehealth trends virtually every week, Rock Health consistently adds more color to these stories with its deep dives into funding and consumer preferences. Its latest research in collaboration with the Stanford Center of Digital Health is no exception.
Rock Health’s annual Digital Health Consumer Adoption Survey of 8,000+ US adults sheds more light on self-reported digital health behaviors, exploring three core insights with plenty of charts included for the visual learners:
INSIGHT #1: Future care models will increasingly integrate asynchronous modalities. (Chart 1)
- 51% of this year’s respondents have used live video telemedicine, making it the most used modality over audio-only or text-based care.
- Rock Health predicts that asynchronous non-video modalities will gain popularity because they enhance clinician efficiency and enable proactive continuous care
INSIGHT #2: Telehealth satisfaction remains high but is trending downward. (Chart 2)
- 43% reported greater satisfaction with live video calls compared to in-person care, down from 53% in last year’s survey.
- The authors attribute the decline to the changing expectations around telemedicine as an alternative to care, rather than as a needed replacement.
INSIGHT #3: High telemedicine adoption skews towards the young and wealthy. (Chart 3)
- Telemedicine adoption is highest among high income patients aged 18-44, underscoring gaps related to broadband access, device ownership, and digital literacy.
- To address these gaps, Rock Health suggests that innovators understand the population they’re building for, and what factors drive that group’s adoption.
Telemedicine’s Path Forward
The survey suggests that telemedicine is beginning to focus on personalized treatments that address the nuanced needs of individuals, serving as a tool for care rather than a business model. Rock Health holds an optimistic view about the future of telemedicine, and with more scalable and equitable solutions hitting the market every day, that’s a safe stance to take.
Online mental healthcare provider Cerebral announced the close of its $300M Series C round, raising the company’s valuation to $4.8B within two years of its launch.
- Cerebral is a “one-stop shop” for comprehensive digital mental healthcare and wellness, offering support for depression, anxiety, and post-traumatic stress disorder among other illnesses.
- Monthly subscription plans give members access to Cerebral’s team of over 2,000 clinicians, lowering barriers to care through its virtual platform combining therapy and medication management for full-service support in the home setting.
- The funding will be invested in new services such as schizophrenia management expected to launch in 2022, as well as strategic partnerships and international expansion.
- Advancing partnerships with employers and payors is another priority for the funds, with Cerebral’s new Chief Impact Officer, Simone Biles, enrolling to help on this front after withdrawing from the Tokyo Olympics to focus on her own mental health.
In-person mental health facilities were heavily impacted by the pandemic, experiencing capacity constraints that frequently led to month-long wait times to see a provider. This created a window for digital providers to address the care gap, with Cerebral reporting that the wait times for its “instant live” visits are now just over five minutes.
Large amounts of capital continue to be directed towards the mental health space, and more M&A announcements from its well-funded startups are likely to follow as companies like Cerebral aggressively compete for contracts with employers.
When Hydrogen Health launched in April of this year, it set out to bring new digital health tools to consumers and employers, a goal that is coming into fruition with the announcement of the nationwide rollout of its Virtual Primary Care offering.
- Hydrogen Health is a joint venture between K Health, Anthem, and Blackstone, offering payors and employers a platform to integrate text-based chats and telehealth visits into their existing services.
- K Health is Hydrogen’s flagship product, leveraging AI to provide patients with personalized information about how their symptoms compare to others experiencing similar symptoms, while collaborating with affiliated clinicians to improve outcomes.
- Virtual Primary Care was originally piloted by Anthem over the summer, but Hydrogen is now expanding to other large employers and health plans to help reach an additional 10M people by the end of 2022.
The Next Generation of Virtual Primary Care
Virtual Primary Care advances Hydrogen’s strategy of building continuous primary care relationships, complete with end-to-end diagnosis and management of chronic conditions without a reliance on in-person visits.
The approach combines K Health’s digital-first platform with a recently expanded affiliated clinician network, addressing issues with traditional care models such as low doctor availability and long wait times.
If a patient requires a referral to specialty care, a board-certified clinician will help navigate them to appropriate providers, creating an easy way for consumers to transverse digital and in-person care.
You’d be hard pressed to find a digital health startup that isn’t talking about removing friction from healthcare, but Hydrogen Health clearly plans to be a leader among those walking the talk.
Companies continue to develop new features for wearables that blur the line between consumer products and medical devices, a trend that Deloitte predicts will be a dominant theme in 2022.
A new report from the consulting firm predicts that more healthcare improvements are on the horizon for wearables, which might increase their effectiveness in the clinical setting as early as next year.
- Smartwatches that measure blood oxygen saturation (SpO2) will likely become more common, as low SpO2 is a potentially life-threatening symptom that’s hard to detect unassisted.
- Continuous blood pressure monitoring could improve due to advances in photoplethysmography (PPG), Raman spectroscopy, and infrared spectrophotometers.
- Over 10% of smartwatch owners are now using them to detect COVID-19 symptoms, with 15% of smartwatch owners purchasing them after the onset of the pandemic.
Although Deloitte projects total wearables shipments to climb from 320M units in 2022 to 440 units in 2024, it also notes several headwinds that could slow adoption.
- Interoperability is cited as a top priority for provider adoption of new technologies, yet only 10% have integrated data from wearables into their EHR.
- Data privacy remains a concern for 40% of smartwatch owners, a figure that rises to 60% among those who use smartwatches exclusively to track their health.
- Increased regulatory scrutiny is anticipated as smartwatch outputs are integrated into EHRs, with most current devices avoiding HIPAA by collecting data for personal use.
Deloitte does not view these obstacles as insurmountable, and believes that simultaneous advances in sensors, semiconductors, and AI will lead to further innovation. Both big tech and the medical community see a bright future for wearables, and their continued investment could make it “a self-fulfilling prophecy.”
Although some physicians might love the time-consuming administrative tasks that help make a successful patient visit, Suki recently raised a $55M Series C round to help develop AI-enabled voice tools for those that don’t.
As of the latest funding, the company has raised a total of $95M to support the development of Suki Assistant, its voice-first digital assistant, and Suki Speech Service, its platform designed to improve the accuracy and experience of voice solutions.
- Suki uses natural language processing to create patient notes and streamline administrative tasks, such as retrieving information from the EHR or ICD-10 coding.
- The digital assistant supports doctors “in any clinical setting, as well as any specialty,” and can be configured with personalized commands to adapt to unique workflows.
- Early research shows that the assistant lowers average time per note by 76%, while decreasing claim denials by 19% through the creation of detailed documentation.
- Voice is quickly entering the healthcare spotlight, with Notable raising a $100M Series B in September and Microsoft acquiring Nuance for nearly $20B earlier this year.
The accuracy of voice recognition has crossed a threshold that allows it to be effective in a growing number of consumer products, as well as in healthcare. These tools can now understand a speaker’s intent regardless of most accents or phrasing, leading to wider adoption within previously difficult use cases.
In a roundabout way, Suki is taking a tech-heavy approach to making technology less visible, removing it from between the doctor and the patient so that more attention can be given to providing clinical care. Taking advantage of voice is a natural way to accomplish this, giving Suki a good shot at reducing burnout by allowing more time for physicians to actually practice medicine.
The digital patient experience and online provider reviews continue to see a growing role in both acquiring and retaining patients, according to Press Ganey’s 2021 Consumer Experience Trends in Healthcare.
The report includes key drivers behind current healthcare consumer behaviors based on a survey of over 1,000 adult patients. Several themes emerged from the responses, each highlighting the fact that healthcare consumerism is on the rise, and here to stay.
Digital drives choice. Patients utilize digital resources 2.2x more than provider referrals
when choosing a healthcare provider.
- Ratings and reviews are the top influence on a consumer’s decision to book an appointment, followed by referrals from a current doctor.
- The average patient looks at 5.5 online reviews before selecting a new provider.
- 61% report that poor-quality reviews would discourage them from choosing a provider.
Search engines are just the start. While search engines are the most used online resource during care-seeking (65%), consumers use an average of 2.7 different sites for research.
- Since 2019, there has been a 54% increase in the usage of healthcare review sites (e.g. Healthgrades and Vitals).
- By contrast, there’s been a 23% decline in the search engine use over the same period.
- 47% of patients search for the type of doctor they’re looking for and “near me,” while only 16% search for their condition or treatment needed
Customer service is the new bedside manner. Patients rate “customer service” (71%) and “communication” (63%) as more important than “bedside manner” when it comes to a five-star experience.
The above trends indicate a steady convergence between healthcare and retail behavior. Consumers use similar criteria to book a hotel or dinner reservation as they do to find a doctor, and they’re growing accustomed to using online reviews to share and research the experience.
While the need to have a “digital mindset” is getting to the point of being a healthcare platitude, the Press Ganey report does a great job emphasizing the fact that a digital strategy involves not only the online patient experience, but also the cultivation of a good online reputation.