Bill Gates

Digital Health

Judge Greenlights UnitedHealth’s Change Acquisition

The big are getting bigger after a federal judge denied the DOJ’s attempt to block UnitedHealth Group’s $13B acquisition of Change Healthcare, delivering a huge victory to the healthcare giant as it continues to vertically integrate its business.

As part of the decision, UHG will be required to divest Change’s ClaimsXten service line (it already has TPG Capital set to pick it up for $2B), although not much else is known about the full opinion since it “may contain competitively sensitive information” and is under seal.

UnitedHealth Group needs little introduction, but in case you’re new to the industry, it runs one of the nation’s largest payors, operates a huge pharmacy benefit manager, and employs thousands of physicians through its care centers.

• Change’s claim processing business is now getting rolled into UHG’s OptumInsight analytics arm, which it argued will help improve outcomes and reduce waste by providing better insights to physicians.

• To give you an idea of UHG’s scale, OptumInsight contributed ~$12B to its insane $288B total revenue in 2021. By comparison, Change did about $3.5B in revenue last year, and even that is getting chopped as it sheds ClaimsXten.

UHG’s position as the US’ most profitable healthcare company paints a huge target on its back for antitrust lawyers.

• The DOJ argued that acquiring Change would give UHG access to a treasure trove of data on its payor competitors and create a virtual monopoly in the claims processing space, leading to lower quality and less innovation.

• UHG countered that it already has access to this competitor data, and has never misused it since doing so would create a huge blowback on its business (we’ll also assume they said something about it being unethical). Some version of this argument clearly stuck.

The Takeaway

Whether or not it created a monopoly, the Optum-Change combination is now a major powerhouse that doesn’t sound fun to try and compete with. DOJ top brass Jonathan Kanter wasn’t very enthused about the outcome, saying “we respectfully disagree with the court’s decision and are reviewing the opinion closely to evaluate next steps.” That looks to us an awful lot like the DOJ is planning to appeal the judgment, but UHG and Change are moving forward with combining the companies “as quickly as possible.”

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The Wire

• MDwise & Cityblock Community Clinics: MDwise and Cityblock Health are partnering to open community clinics in Indiana that will support over 10k Medicaid members in addressing SDOH, physical, and behavioral health needs. Cityblock’s value-based model leverages multidisciplinary care teams that include Community Health Partners who are hired from the communities they work in to create personalized plans, identify potential SDOH barriers, and connect members with local providers and resources.

• Big Tech vs. Innovaccer CRM: Innovaccer’s GM of CRM Gary Druckenmiller Jr. came back with a strong rebuttal to a recent Modern Healthcare article that touted Salesforce as a favorite in the healthcare CRM race. Druckenmiller’s post is a great read packed with both spicy metaphors and well-grounded reasons why big tech’s beloved approach to repurposing general-use tools to the healthcare space is an uphill battle, particularly when it comes to data management and implementation.

• Digital vs. In-Person CBT: A paper in npj Digital Medicine brought some good news for the crop of digital behavioral health startups that recently sprung up to focus on self-guided cognitive behavioral therapy. The review of 106 studies (11.8k patients) revealed that there’s no significant difference between the effectiveness of face-to-face and digital CBT, although the number of sessions and level of human guidance in digital CBT did have an impact on its effectiveness.

• Intelerad Acquires Life Image: Medical image exchanges crowned a new leader last week when Intelerad acquired its rival Life Image. The acquisition combined two of the top three exchange companies (the other is Nuance), and created a far more straightforward roadmap toward building a “true nation-wide, electronic image exchange network.” If you work in medical imaging and didn’t catch our full writeup in the Imaging Wire, you’re missing out.

• 2021 Burnout Levels: A study of 2.4k physicians in Mayo Clinic Proceedings revealed the unfortunate yet not too surprising information that 63% of physicians experienced burnout at least once in 2021 (up from 38% in 2020). Last year saw a 39% rise in emotional exhaustion scores and a 35% decrease in work-life balance satisfaction, although the moderate 6% increase in depression scores caused the authors to conclude that “the increase in physician distress in this interval was primarily due to increased work-related distress.”

• Memora + UP Medical: Virtual care platform Memora Health is partnering with UP Medical, a multi-specialty medical group dedicated to improving outcomes for patients managing chronic conditions. Memora’s SMS-based tech uses natural language processing to triage patient-reported symptoms while helping with care plan adherence, and UP Medical intends to leverage the platform to engage patients between visits and reduce the burden of repetitive manual communication on its care teams.

• Soda Scores $25M: Soda Health raised $25M in Series A funding to expand its platform that connects Medicare Advantage and Medicaid members to personalized supplemental benefits available through their plans. By personalizing benefits based on health status and need, Soda aims to create a single card that can help members access all of their benefits across any retailer with a dramatically simplified experience.

• Out-of-State Telehealth: A JAMA study of 8M Medicare patients with a telehealth visit during H1 2021 showed that cross-state licensure flexibilities disproportionately impacted primary care, mental health, and cancer patients – the same patients who stand to be hardest hit as waivers wear off. Just over 60% of the 422k out-of-state telehealth visits were with primary care or mental health clinicians, while patients in rural communities and cancer patients also saw high cross-state visits as a percentage of total telehealth use (rural: 33.8%, cancer: 9.8%).

• Epic Adds Clinical-Trial Matchmaking: Epic debuted its Life Sciences program to expand access to clinical trials and speed up the development of new therapies by connecting providers, patients, and research sponsors through a unified system. Providers can now enroll for the Life Sciences program within their Epic EHR to view clinical trials that might be well-suited for their patients and validate their eligibility.

• Google Improves Medicaid Search: During Google’s Health Equity Summit, the company announced changes it’s making to its search features that help Medicare and Medicaid members easily find in-network care options / appointment availability. Starting in the next few weeks, people interested in Medicare and Medicaid plans can search Google to find additional information about eligibility and enrollment, while current members can filter nearby providers to find those who accept their plan.

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