5/7/21 Weekly Update

Summarizing the week that was in the business of healthcare

May 08, 2021

Welcome to The Donut Hole’s weekly summary. The news doesn’t stop. Lucky for you, we are here to help you take in the week that was in the business of healthcare.

AMA: Physicians in independent practice now minority in US

Here’s a timely follow-up to the story around independent practices in Connecticut we reviewed in our issue a few weeks ago. Per the AMA survey, over 50% of physicians practicing in 2020 were employees (i.e. of large practice groups or hospitals), up from 47% in 2018 and 42% in 2012. At the same time, the percentage of physicians who own their practices has declined from 53% in 2012 to 44% in 2020. Moreover, the vast majority of doctors under the age of 40 are now employees rather than employers, suggesting the trend towards employment vs. ownership will continue over the long term and reflecting the increasing administrative burden. Also highlighting the increasing administrative burden on providers is the growing size of existing medical groups. The proportion of doctors working in medical groups with 10 or fewer doctors was 54%, compared to 57% in 2018 and 61% in 2012. At the same time, the proportion of physicians in practices with 50 or more doctors grew from 12% in 2012 to 17% last year.

The graph of of the variations in employment status by specialty is below. More details around the results and variations amongst specialties are available in the survey.

Potential impact on you: There’s a lot to digest in the survey but the takeaways echo what we discussed a few weeks ago. For those practicing in or entering primary care and internal medicine, it is getting harder and harder to run your own practice. As the U.S. moves to more value-based payment models, expect these challenges to compound due to sophisticated reporting and analytics requirements.

HCA sells 4 hospitals in Georgia as it emphasizes focus on post-acute, home-based services

HCA, one of the country’s largest health systems, announced the sale of four hospitals in Georgia for $950. HCA plans to use the proceeds to fund growth efforts in outpatient and home-based procedures and healthcare services, a key strategic aim for the company. On a recent quarterly earnings call, HCA CEO Sam Hazen commented:

“We believe homecare provides multiple channels of value for us," Hazen said. "Some of it's in better case management and discharge planning and some of it is staying connected to the patient."

HCA has been fairly aggressive in executing this strategy. Earlier this year, HCA spent $400M to acquire a majority stake in Brookdale Senior Living's home health, hospice business and outpatient therapy business (Brookdale is the 7th largest home health
company in the nation). HCA is also focused on ambulatory surgery centers, with 10 to 12 under development, according to recent remarks from Hazen.

Potential impact on you: This announcement builds on the Humana / Kindred deal we discussed last week. The undeniable trend is that care is moving out of the hospital to the home and other lower cost care settings. The pace of the change remains to be seen, but it’s telling that the country’s largest payors and providers are aggressively positioning themselves for the shift. This is also another indication that hospitals are not as profitable as they once were. We’ll expand on payor mix and uncompensated care in future issues.

UnitedHealth launching post-discharge home program for group MA plans

While we’re on the topic of home care and integration across care settings, industry giant UnitedHealthcare is launching a home health program that aims to reduce the likelihood of poor outcomes after discharge from the hospital or skilled nursing facility. The offering, called Healthy at Home, will cover a range of post-discharge services, including food and transportation. Through the program, members can access two meals per day for two weeks after discharge and up to 12 one-way rides for care following their hospital or nursing home stay.

Potential impact on you: In addition to the emphasis on improving care in the home, the program also touches on impacted social determinants of health (SDOH). Better investments in basic resources like food and transportation are likely to help patients adhere to their treatment plans and help UnitedHealth avoid expensive re-admissions.

Boost Mobile’s Unlimited Plus plan now offers telemedicine

We reviewed Verizon’s telemedicine play in a previous issue, and now another telco is entering the virtual care space. Boost Mobile, the company behind the beloved “Where you at?” marketing campaign, is partnering with asynchronous virtual care start-up K Health to offer no-cost virtual visits to Boost Mobile Unlimited Plus plan subscribers. Subscribers on other Boost Mobile plans will also be able to access the service for $7.99 per month. K Health provides 24/7 access to doctors and an AI-powered symptom checker for virtual urgent and primary care, prescriptions refills, and mental health support.

In the announcement, Boost Mobile’s CEO highlighted the partnership’s ability to improve access to care for the company’s customer base, which is typically lower income and from underserved communities.

"Boost Mobile customers are disproportionately affected by rising health care costs. Boost Mobile is bridging the gap by providing affordable wireless access, and now we want to expand those efforts to address the health care divide," Stephen Stokols, CEO of Boost Mobile, said in a statement. "K Health is the perfect partner to create a pathway to better health for individuals and families who do not have affordable access to medical services, which we estimate is up to half of our user base."

Potential impact on you: As with CVS’ preventative screening program we discussed last week, we applaud any efforts to broaden access to care, especially primary care and prevention services. Hopefully, this partnership will allow Boost Mobile subscribers to more quickly address health conditions and better manage chronic diseases.

The partnership is also further evidence of the disruption of the traditional care model. Efforts around creating “alternative front doors” to healthcare will continue to proliferate, and traditional providers, especially primary care practices, will need to innovate to maintain patient volumes and attract employees.

Three Florida Men Charged in $46 Million Health Care Fraud, Kickback, and Money Laundering Conspiracy

Fascinating case for all of you with a criminal justice interest. Hit the link and enjoy the classic American tale of Medicare fraud, illegal kickbacks, and money laundering! It also shares some similarities with the uBiome saga we discussed back in March.

The Donut Hole