9/22/21 Weekly Update

Summarizing the week that was in the business of healthcare

Sep 23, 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.

CareFirst unveils virtual-first primary care practice

Baltimore-based health insurer CareFirst BlueCross BlueShield has launched CloseKnit, a virtual primary care practice. The offering includes preventive and urgent care, behavioral and mental health, care coordination, and insurance navigation at no additional cost. CloseKnit clinicians will also offer referrals to local providers for in-person care when needed. The program was designed to address care gaps for the estimated 40% of health plan members who do not have a primary care provider.

Commentary: This feels like the logical next step for virtual urgent care. Payors will offer their own services or white label offerings from companies like Teladoc as they aim to control more aspects of the member experience and reduce the use of emergency room visits for low acuity needs, particularly for those without primary care clinicians. These services will face competition, though. Traditional provider groups and more niche, virtual-first upstarts will continue to expand their virtual capabilities as well. Ultimately, most patients will likely go to the lowest cost offering as long as the clinician quality is good enough, but there will be others who are willing to pay for 1:1 relationships with specific clinicians (i.e. concierge) and more personalized or holistic care experiences.

Apple Is Working on iPhone Features to Help Detect Depression, Cognitive Decline

After all of the recent Google and Amazon healthcare news, it’s good to see Apple making some noise again! According to the Wall Street Journal, the company is reportedly working on ways to help detect and diagnose conditions such as depression, anxiety, and cognitive decline using an iPhone. Researchers hope that analysis of data such as mobility, sleep patterns, typing behavior, and facial expressions could spot behaviors associated with those conditions. Apple is collaborating with UCLA and Biogen (manufacturer of controversial cognitive decline therapeutic Aduhelm) on the studies.

Previous studies have suggested that people with certain conditions use devices differently than others, but it’s not yet clear whether developers can build algorithms that can detect mental health conditions reliably and accurately. If successful, Apple will likely introduce new alerts that prompt users to seek further care with licensed clinicians.

Commentary: Even if these efforts produce impactful new features for Apple, they are years away. Nevertheless, there is a lot of potential in these new digital biomarkers (e.g. Mindtsrong’s work) and it’s likely they will be clinically useful at some point in the future. The one major concern we see is from false positives. Apple already has an infamous false positive problem with its arrhythmia feature where many people who didn’t have an actual cardiac condition still received abnormal readings from the Apple Watch. That’s bad, but taxing an already overburdened behavioral health system with individuals Apple mistakenly flags as having behavioral health conditions could be disastrous.

CMS suspends enrollment in UnitedHealthcare, Anthem MA plans

The Centers for Medicare & Medicaid Services (CMS) has suspended enrollment in three UnitedHealthcare and one Anthem Medicare Advantage plan for 2022 because the plans did not spend enough of their premium incomes on medical benefits and claims. Medicare Advantage (MA) plans are required to spend at least 85% of premium income on medical benefits and claims (i.e. the medical loss ratio, MLR). When a plan fails to meet this threshold for three consecutive years, CMS suspends the plan’s ability to enroll new members. The three UnitedHealthcare plans represent about 80,000 enrollees, a small percentage of its nearly 7.5M MA members as of August 2021. The Anthem plan is a Part D prescription drug plan in Puerto Rico, but it’s unclear how many members are impacted.

UnitedHealthcare blamed the pandemic for the MLR miss as people deferred office visits, surgeries, and other care. United may need to issue rebates to 2021 enrollees to ensure they meet the target MLR this year.

Commentary: This serves as further evidence of COVID’s impact on care delays, although it seems like these particular plans experienced MLR issues in 2019 as well. The story also is a reminder to play by the rules. We’ve seen what happens when providers try to game the system and when startups like Theranos play fast and loose with our regulatory framework. Now it’s payors in the spotlight, albeit for a far less serious offense.

Abbott seeks expanded indication, national coverage for CardioMEMS device

Abbott’s implantable device was first approved in 2014 to prevent hospitalizations in patients with class III heart failure. The device measures pressure on the patient’s pulmonary artery as an indicator of worsening heart function. If the pressure is out of range, their doctor can adjust their medication and hopefully avoid the need for in-patient treatment. Now, following an additional clinical trial and publication in The Lancet, the company is seeking the Food and Drug Administration’s approval to use the device in class II and IV patients as well.

Concurrently, CardioMEMS is on the CMS’ national coverage determination waitlist. Abbott hopes to secure reimbursement for the expanded indications as well as shore up concerns some insurers had around mixed data in the device’s original clinical trial.

Commentary: As we’ve talked about with digital therapeutics (Pear’s reSET-O dtx), clinical trials and evidence generation is just one step in the long path of commercial success. The CardioMEMS story illuminates the arduous tasks of FDA approval, indication expansion, and payor coverage determinations. And even when all of that is achieved, medical device, biopharma, and digital health companies must convince physicians to actually prescribe and use their products.

The Donut Hole