Analysts say Amazon already has the core competencies to compete in healthcare: ready access to capital, a massive distribution infrastructure, a strong technology base, robust data analytics, and a deep executive bench.
The speculation is rife about how, when and where Amazon will plunge into the healthcare sector.
In a new reportthat describes five scenarios through which Amazon could enter and dominate the industry, Rob Haslehurst, a managing director at Boston-based L.E.K. Consulting, warns against pigeonholing the e-commerce giant.
"Anyone who thinks of Amazon as just a very big digital retailer needs to think again," Haslehurst said. "They have continually expanded their business model and today they are a leader in cloud computing, a provider of in-home services and a bricks-and-mortar food purveyor in addition to their ecommerce offerings."
"They have repeatedly shown that they have the capabilities, the patience, and the deep pockets to disrupt industry after industry," Haslehurst said. "Healthcare is no exception."
Amazon’s five possible entry points are:
Durable medical equipment and medical supplies. Amazon's core competencies in logistics and distribution, and its existing B2B ecommerce platform, will allow it to easily expand into hospital and provider supply, disrupting the traditional group purchasing organization contract model. Amazon has already obtained licenses to distribute medical supplies to providers in 43 states.
Mail order and retail pharmacy. Amazon has secured approval as a wholesale distributor from 12 state pharmaceutical boards. Drug storage is a hurdle, and there are regulatory challenges. But Amazon can build pharmacies into its recently-acquired Whole Foods stores. The company can also take advantage of its predictive analytics and customer data capabilities to build digital health tools that track and influence patient behavior — giving it a leg up over traditional pharmacy in working with the most challenging areas of healthcare delivery.
Pharmacy benefit manager. Amazon's most likely move into the field will be by partnering with a large PBM such as Express Scripts or by buying a smaller player like Prime Therapeutics. Amazon would gain a pharmacy network and a claims adjudication capability, and its partner would gain access to millions of Amazon Prime members.
Telemedicine or in-home healthcare. Amazon's Echo smart speaker (with 20 million units sold to date) and Alexa, its voice-controlled personal assistant service, give it an enormous platform for new voice-activated services. Healthcare could easily be among them. Alexa's first step would be to help book physician visits. But thanks to Echo Show's video capabilities, the next move might be in-home virtual house calls.
AI-powered diagnostics and continuous care. Amazon has deep AI capabilities — machine-learning already drives many of its offerings, from its customer recommendation engine to its service centers. The next step would be to harness that capability for first-line diagnostics, and services such as auto-refills for prescriptions, and medication reminders.
L.E.K. Managing Director and report co-author Joseph Johnson said these five potential inroads strategies "are not mutually exclusive."
"In fact, they represent a roadmap that Amazon can follow to move continually deeper into the healthcare industry," Johnson said. "All of them illustrate Amazon's ability to drive down prices and margins while fundamentally transforming customer behavior."
Prosecutors claim that Alere continued to sell its Triage cardiac and drug test kids even as providers made it known that the device was faulty. The FDA recalled Triage in 2012.
Medical device maker Alere Inc. will pay the federal government $33.2 million to settle False Claims Act allegations that it knowingly sold “materially unreliable point-of-care diagnostic testing devices" to hospitals, the Department of Justice said.
Federal prosecutors allege that, from 2006 through 2012, Alere sold hospitals its Triage devices, which are used in emergency departments for the diagnosis of acute coronary syndromes, heart failure, drug overdose, and other serious condition.
Alere continued to sell the product, prosecutors said, even as it received multiple complaints from providers that "put it on notice that certain devices it sold produced erroneous results that had the potential to create false positives and false negatives that adversely affected clinical decision-making."
Despite those warnings, prosecutors said Alere failed to take corrective action until the Food and Drug Administration issued a national product recall in 2012.
Of the $33.2 million paid by Alere, $28.3 million will be returned to Medicare, and $4.8 million will be returned to states that paid for Triage devices with Medicaid.
HealthLeaders Media's requests for comment from Alere were not immediately returned on Friday afternoon.
"Physicians who work to treat patients with suspected myocardial infarctions rely upon devices such as Alere's Triage Cardiac products for quick and accurate readings," said Stephen M. Schenning, Acting United States Attorney for the District of Maryland.
"When manufacturers such as Alere make changes to the specifications that affect the product’s reliability without informing physicians or the FDA, patient care is put at substantial risk," he said.
The settlement resolves a whistleblower lawsuit brought forward by Amanda Wu, a former senior quality analyst at Alere, who will receive $5.6 million of the settlement.
Audit finds more than 60% of physical therapy services claims failed to comply with Medicare medical necessity. CMS says auditors were 'inaccurate' in their policy interpretations.
Medicare could be issuing more than $730 million in improper payments each year for outpatient physical therapy services, a government report suggests.
An audit by the Office of the Inspector General at the Department of Health and Human Services examined 300 randomly selected claims physical therapy services between July and December, 2013 and found that 61% of the claims did not comply with Medicare medical necessity.
The 184 improperly paid claims totaled $12,741. Extrapolating the audit findings over six months, OIG estimates that the Medicare improperly paid $367 million for physical therapy services.
The auditors said the overpayments occurred "because the Centers for Medicare & Medicaid Services' controls were not effective in preventing unallowable payments for outpatient physical therapy services."
OIG recommended that CMS:
Tell Medicare Administrative Contractors to notify providers of potential overpayments so they can exercise reasonable diligence to investigate and return any identified overpayments;
Establish mechanisms to better monitor the appropriateness of outpatient physical therapy claims;
Educate providers about Medicare requirements for submitting outpatient physical therapy claims for reimbursement.
In comments responding to the audit, CMS Administrator Seema Verma disagreed with many of the findings and said OIG was "inaccurate" in its interpretation of policy around physical therapy services.
"CMS’s coverage policy for outpatient therapy services makes clear that coverage turns on the beneficiary’s need for skilled therapy services, and such skilled therapy services may be necessary to improve a patient’s current condition, to maintain the patient's current condition, or to prevent or slow further deterioration of the patient’s condition," Verma said.
"The OIG, however, has interpreted CMS’s policy as allowing coverage only when there is an expectation that the patient's condition will improve significantly. This is an inaccurate interpretation of CMS's coverage policy for outpatient services and is contrary to the court-approved settlement in Jimmo v. Sebelius."
"Furthermore, while CMS's coverage of rehabilitation therapy is designed to address the patient's recovery or improvement in function, it does not require 'significant improvement' in the progress they make for their individualized plan of care," Verma said.
The deal would make Mission Health the first HCA-owned health system in North Carolina, and create a foundation to fund population health initiatives in the western regions of the state.
HCA Healthcare is negotiation the acquisition of Asheville, NC-based Mission Health, the two health systems announced this week.
If the deal is finalized, Mission Health would become the first health system in North Carolina owned by Nashville, TN-based HCA, the nation’s largest for-profit hospital chain.
Mission President and CEO Ronald A. Paulus, MD, said HCA understood that his six-hospital nonprofit health system had the resources to remain independent, "and yet we both recognize that meeting our core missions could be achieved more effectively together."
"It is a tribute to the Mission Health Board and team that we are in such a position of strength that we can make the best choice for our people, our patients and our communities," he said. "We believe that HCA Healthcare uniquely provides the experience, scale and resources that will enable Mission Health to enhance and expand our services in western North Carolina."
The proposed acquisition would transition the 130-year-old Mission Health to a for-profit health system, which is "expected to generate millions of dollars in tax revenues for the area," the two health systems said in their joint announcement.
In addition, a letter of intent unanimously approved by the Mission board this week includes a proposal to establish a foundation that would invest in initiatives to improve the health of people living in the service area.
Mission Health generates more than $1.5 billion in annual revenues, and includes six hospitals, with more than 1,000 licensed beds, outpatient and surgery centers, a long-term acute care hospital, and a Level II trauma center. Mission is the sixth-largest health system in North Carolina and employs approximately 12,000 people.
Citing health concerns, Christoperh G. Dawes will step down immediately after nearly 30 years as leader of the nationally renowned pediatric health system.
Christopher G. Dawes, the long-serving CEO and president of Lucile Packard Children's Hospital Stanford and Stanford Children's Health, said this week that "recent health developments" have prompted his immediate retirement.
CMO Dennis Lund, MD, will serve as interim CEO while a search is undertaken for Dawes' successor.
In a LinkedIn message to colleagues and friends this week, Dawes said he’d planned on announcing his retirement next week, but that his unspecified health concerns accelerated that plan and forced him to take an immediate medical leave.
Dawes joined Palo Alto, CA-based Children's Hospital at Stanford 29 years ago, and was named the first -- and only -- CEO of Lucile Packard Children's Hospital when it opened eight years later.
"This past December I had the great fortune to, once again, cut the ribbon on the opening of a brand new hospital building, setting the stage for unparalleled pediatric care for children and mothers," Dawes said.
Dawes said he is "particularly proud" of the high-quality clinical services created at Packard and Stanford Children’s Health, which is widely regarded as among the top pediatric health systems in the nation.
"After my 21 years at the helm overseeing milestones such as these, I believe it is now time to pass the baton to the next generation of executives," Dawes said.
A review of privately insured claims data shows that the median charge for a 30-minute new patient office visit ranged from $294 in an office to $242 in an urgent care center to $109 in a retail clinic.
Urgent care centers saw volumes grow at a rate of 1,725% for privately insured patients between 2007 and 2016, which is more than seven times the volume growth of emergency rooms for the period, according to data compiled in two reports by nonprofit FAIR Health.
The FAIR Health reports examine healthcare pricing, care venue utilization and services and are based on more than 25 billion privately billed healthcare claims.
Among the findings:
From 2007 to 2016, urgent care centers showed an increase in claims of 1,725%—a growth rate more than seven times that of ER claims (229%) in the same period.
In retail clinics and urgent care centers in 2016, acute respiratory infections, such as the common cold, were the number one diagnostic category.
In telehealth, mental health-related diagnoses were the number one diagnostic category.
Across all care venues in 2016, more claims were submitted for women than men in every adult age group.
In 2016, the median charge for a 30-minute new patient office visit ranged from $294 in an office to $242 in an urgent care center to $109 in a retail clinic.
From 2007 to 2016, claims for ambulatory surgery centers increased 127% in rural areas and 95% in urban areas.
The 31- to 40-year-old demographic accounted for 18% of claims among patients using urgent care centers. For telehealth, the peak age groups were 41 to 50 and 51 to 60 years, at 19% each.
The median billed charge for evaluation and management services in a hospital increased 28% in from 2012 to 2016. For the same period, the growth for allowed amounts for E&Ms in a hospital—reflecting the maximum amount an insurer will pay for a service—was 26%.
The index for billed charges for surgery shows growth of 3% from 2012 to 2016, and the surgery allowed amount index shows growth of 2%.
FAIR Health said the relative flatness of the surgery indices when compared to those for professional E&Ms in a hospital are due to factors that include hospitals buying physician practices, new technologies that lower prices, and hospital surgeons staying competitive with ambulatory surgery centers.
A new study finds no correlation between limited shift lengths and how medical residents spend their time, or how they score on tests of medical knowledge.
Limiting first-year medical residents to 16-hour work shifts gives them a better work-life balance and makes them happier, a new study shows.
However, residency training directors believe the curtailed hours, with no ability to flex for longer shifts, impedes medical training, according to the study which was published online in The New England Journal of Medicine.
Regardless of those concerns, the NEJM study—which tracked thousands of first-year residents in 63 internal medicine training programs nationwide—found no correlation between limited shift lengths and how medical residents spent their time, or how they scored on tests of medical knowledge.
"Many educators have worried that the shift work created by limited duty hours will undermine the training and socialization of young physicians," said principal investigator David Asch, MD, with the Perelman School of Medicine at the University of Pennsylvania, in notes accompanying the study.
"Educating young physicians is critically important to healthcare, but it isn’t the only thing that matters. We didn't find important differences in education outcomes, but we still await results about the sleep interns receive and the safety of patients under their care," Asch said.
The arduous hours for medical residents were justified by training directors as a way to prepare new physicians for the rigors of the job, and to ensure continuity of care that can be disrupted by shift changes. Proponents of limited shift hours have argued that long hours lead to fatigue and errors.
In 2003, the Accreditation Council for Graduate Medical Education issued its first set regulations based on expert opinion—30-hour maximum shifts and 80-hour maximum workweeks—for all accredited residency programs. More stringent regulations were adopted in 2011 that limited interns to 16-hour shifts and more senior residents to 28-hour shifts.
Despite the findings that appear to support limited shifts, Asch said questions remain.
"We created this study to simultaneously evaluate the effect of alternative duty hour policies on resident education, resident sleep and alertness, and patient safety," he said. "The part of this study being reported in the March 20 issue of the New England Journal of Medicine is about medical education. It will be essential to see the rest of the data before we know where to go next."
Asch said those results should be available early next year.
Funding for the study was provided by the ACGME and the National Heart, Lung, and Blood Institute.
Harvard, Johns Hopkins, Duke and Emory figure prominently in the magazine's list of the nation’s top graduate schools for medicine and nursing, which is compiled based on surveys and metrics from hundreds of universities.
U.S. News & World Report has released its widely read listings of the nation's top medical and graduate nursing schools for 2019.
The124 medical schools that supplied metrics to the magazine were divided into top research schools, and top primary care schools. The methodology can be viewed here.
A tie between Baylor College of Medicine, Houston, TX; and Oregon Science and Health University, Portland.
Graduate nursing programs at 314 universities were surveyed and ranked separately for master’s programs and doctoral programs. The methodology can be viewed here.
Clincians raise patient safety concerns about a policy that foists onto ophthalmologists the responsibility for anesthesia monitoring during cataract surgery. Anthem says the policy is consistent with its commitment to providing high-quality, affordable care.
An Anthem Inc. policy under which ophthalmologists assume responsibility for anesthesia and patient monitoring during cataract surgeries is not sitting well with the clinicians who conduct the procedures.
American Association of Nurse Anesthetists President Bruce Weiner, CRNA, this week called it a "dangerous and reckless policy that jeopardizes the safety and well-being of millions of patients, all in an effort to cut costs and increase profits."
"While cataract surgeries are generally routine surgical procedures that require anesthesia, especially those involving hypersensitive areas like the eyes, call for highly educated anesthesia professionals like CRNAs to administer medication and monitor patients properly without distraction," he said.
David Glasser, MD, clinical spokesperson for the American Academy of Ophthalmology, said the academy "feels strongly that Anthem’s new policy is not in the patient's best interest."
"An ophthalmologist cannot administer conscious sedation, monitor the patient and do cataract surgery, all at the same time. Having anesthesia personnel in the room is one of the key ingredients in the safety and effectiveness of cataract surgery today," Glasser said.
"The decision to have an anesthesiologist or nurse anesthetist in the room during cataract surgery with sedation is best made by the ophthalmologist and the patient. And that decision should place the patient’s well-being first, above all other considerations," he said.
Anthem defended the policy and said it was consistent with the insurer's commitment "to providing consumers with access to high quality, affordable healthcare, including safe and effective medical technologies."
"One of the ways we work to meet this commitment is to ensure consumers receive the right care, at the right time, in the most appropriate clinical setting," Anthem said.
Weiner says most cataract patients are older and at greater risk for complications due to comorbidities such as respiratory and cardiovascular disease.
"For this reason the AANA is gravely concerned about not having an anesthesia professional such as a CRNA providing anesthesia care during cataracts surgery," Weiner said. "It is neither practical nor safe for ophthalmologists to simultaneously perform surgery, administer anesthesia and monitor patient conditions."
Weiner said that cataract surgery is safe and complication free for the approximately 3.6 million people who undergo the procedure each year, in large part because proper patient care teams are in place.
"Anthem’s new policy, however, puts millions of people at risk for serious eye injury or worse by asking ophthalmologists to manage two very intricate procedures at the same time," he said.
Anthem said the policy has been vetted by its physician-led Medical Policy & Technology Assessment Committee.
"According to the literature reviewed, there is no one definitive approach regarding the use of anesthesia for cataract surgery and patient specific needs should be taken into consideration as well as potential risk of harm to individuals who are sedated during surgical procedures," Anthem said.
"Anthem’s guideline allows for general anesthesia and monitored anesthesia care for cataract surgery when clinical indications support that they are medically necessary and provides coverage for other forms of anesthesia, including intravenous moderate sedation, without the need for review.
"We value our relationships with providers. We have been and will continue to have a dialog with our providers and medical societies regarding their concerns," Anthem said.
"Anthem is committed to providing consumers with access to high quality, affordable healthcare, including safe and effective medical technologies. One of the ways we work to meet this commitment is to ensure consumers receive the right care, at the right time, in the most appropriate clinical setting."
The Shreveport-based hospital chain expands its footprint in Louisiana with the acquisition of hospitals in Ville Platte, Eunice and Minden.
Privately held Allegiance Health Management is buying three hospitals in Louisiana from Tennessee-based LifePoint Health.
The transaction is expected to be finalized in the coming months, after regulatory review. Financial terms were not disclosed.
"We are delighted to move forward adding these hospitals to the AHM system and further demonstrate our commitment to this region," said Allegiance CEO Rock Bordelon.
"These facilities are each outstanding in their own right, and we have been incredibly impressed by their commitment to and success enhancing quality and patient safety," Bordelon said. "We look forward to working with their teams to improve healthcare delivery across this region."
When the sale is completed, Brentwood, TN-based LifePoint will have only one hospital remaining in Louisiana: Teche Regional Medical Centerin Morgan City.
"Regional collaboration and the creation of strong regional networks have never been more important," said Scott Smith, CEO for LifePoint's Louisiana hospitals.
"As part of AHM, we have an opportunity for Mercy Regional Medical Center, Acadian Medical Center and Minden Medical Center to join a growing regional system and build additional local networks to serve patients."
This week's deal is the fourth Louisiana hospital acquisition for Allegiance this year. Last month, Allegiance acquiredByrd Regional Hospital, a 60-bed hospital in Leesville, from Community Health Systems.
Shreveport-based Allegiance operates 13 hospitals in Louisiana, Texas, Mississippi and Arkansas. When these most-recent acquisitions are completed, Allegiance will operate nine hospitals in Louisiana.
Allegiance said no layoffs are planned with the acquisitions.
