February 15, 2023

Healthcare Private Equity Activity for 2023

There's a lot of speculation about what impact the current economy will have on PE and M&A activity in the healthcare industry. Will there be more consolidation? Less investment in new products and services? More focus on cost containment? What, pray tell, is the "current economy" anyway?

For predicting capital trends in healthcare, the S&P 500 is about as useful a metric as body mass index. When predicting the impact we'll see from the swirling currents of the Inflation Reduction Act, continuing (if slowing) inflation, and the worries about a contracting economy, a few trends do stand out, and many experts are predicting that private equity firms will be cautious in their investments in the next few years even in the traditionally recession-resistant healthcare space. In light of this, we've compiled a list of six trends to watch out for in 2023:

1. More Consolidation Among Healthcare Providers

With healthcare reform bringing so much change to the industry, many providers are looking to consolidate in order to remain competitive. This could lead to more M&A activity among hospitals, health systems, and other provider organizations. Almost every week we read about another major health player reporting a staggering loss. Consolidation is a common salve here, providing a broader footing and scale efficiencies.

2. Increased Focus on Cost Containment

As reimbursement rates continue to decline, investors will be looking for companies that can demonstrate a commitment to cost containment. Benefitting from medical practices and facilities that can still offer returns means finding the organizations that provide innovative solutions for driving down costs, and/or those that offer value-based care models.

3. Fewer New Healthcare Ventures Launching

With uncertainty around healthcare reform, we may see fewer new ventures launching in the space. This could mean less investment in areas like digital health and biotechnology.

4. More Investment in Services that Drive Revenue Growth

In order to offset declining reimbursement rates, investors will likely look for companies that can drive revenue growth through new services and offerings. This could include things like population health management or care coordination services.

5 . A Shift Away from Traditional Private Equity Investors

If traditional private equity firms become more cautious with their investments, we should see a shift towards strategic investors or venture capital firms moving more risk into the healthcare space. These investors are often more willing to invest in startups, emerging technologies, and other riskier investments, and may be less wary of higher interest rates in the market.

6. Continued Focus on Healthcare Consumers

Agile companies that have been successful in developing consumer-facing health technologies for established payers and providers, such as telemedicine, communication portals, remote monitoring, and "find-a-doctor" web applications, are likely to continue multiplying and expanding, driven by cost containment, care quality considerations, an aging population, and the growing market for faster, more immediate responsiveness to patient needs.


No one can dispute the existence of huge healthcare opportunities in a market that's getting older and more frail, and consuming unprecedented volumes of products and services. It remains to be seen exactly what investors will fund in healthcare this year, but one thing is certain: Profits will be made.

February 13, 2023

Healthcare is the Healthy Thing, Right?

 An article out today in Fierce Healthcare looks at how the downturn in the economy is affecting healthcare funding and investment. Noting that 2022 was a bang-up year for private equity healthcare  deals, Fierce notes the drop in the S&P 500 of nearly 20%. So, what's happening in this rather healthy and "recession-proof" in 2023?

The article cites predictions from economists seeing recession ahead, and quotes Duane Fitch, national healthcare management consultant at Plante Moran as seeing "pretty much every dynamic going in the wrong direction" as a "perfect storm" for hospitals and systems.

I looked to some related reports to find that Bain Capital saw some optimism in January, particularly where "recession-resilient themes" are in investors' crosshairs. Followers of Jim Cramer will remember his December 2022 prediction of a banner year in 2023, and picking some winners: About Danaher (DHR), he says it's "one of the best-run companies in any industry." Cramer also held up Pfizer, United Health Group, Edwards Life Sciences, and he called the Humana the "best-of-breed" for managed healthcare stock.

Of course, no 30,000' overview of the market would be complete without taking a glance over at Motley Fool, where the merry jester noted that it all depends on the tune you're skipping to. Noting last July that, as is the conventional (and verifiable) wisdom, healthcare stocks are "one way for investors to hedge against recession risks." From there they danced through some of the familiar jigs, warning that "it wouldn't be too surprising if the economy actually did end up contracting in the near future," and recommending a fresh assessment of portfolio segments to see which are prepared for Fitch's storm, and which may not be.

The Fool sees continued, if muted, green in pharmaceuticals. Big pharma stocks won't sustain "major damage." Biotech, however, faces continued "headwinds."

CarePrecise is in contact with many technology-based business activities, including consumer-facing health-related applications and various healthcare marketing projects. Fourth-quarter 2022 was a busy time, particularly for marketing to clinics and medical practices. Development in provider management systems has been strong and growing, right up through January of 2023.

In a Chief Healthcare Executive article, Kristin Pothier, global lead, healthcare and life sciences deals advisory at KPMG, is quoted stating that providers have been stretched during the pandemic, and they "are also dealing with massive staff shortages, as staff have gotten sick, or sick of working." She says that hospitals should be using technology to reduce burden on their staffs, including telehealth and automation

A year ago, KaufmannHall pointed to the difficult year for hospitals in 2021, seeing the smaller number of M&A transactions being offset by a larger percentage of higher transactions. The trend has continued on a more-or-less steady roll.

My take-away is that healthcare technology should remain a healthy segment through a recession, though we do see the potential for a growing impact on hospital mergers and acquisitions. 

February 10, 2023

AI Stumbles and Soars in Science and Healthcare

CarePrecise is all about hard, authoritative, verified provider data, so it's odd I find myself again talking about Artificial Intelligence in the science and healthcare space. But the stories keep coming in.

This time my source is 
Samantha Holvey's excellent healthcare IT newsletter, Whealth Care (available via LinkedIn). I know Samantha's work from her years with the Workgroup for Electronic Data Interchange (WEDI), an industry collaborative to support and implement data standards in healthcare. Her weekly post offers a concise, insightful index to the most significant stories in HIT,  spanning government, research, and industry developments.

Google's $100 Billion Software Glitch


The first story that popped out was how, oops!, #Alphabet shares dropped $100 billion (not a typo) when a demo of its new #ChatGPT rival, #Bard, pulled a Hindenberg landing on an international stage.



Developers will soon be looking for an exoplanet to hide behind. 

Oh, the robotity.

ClosedLoop Gets KLASsy, Again

The Best in KLAS rankings for 2023 are out, with  #ClosedLoop claiming 2023 Best in KLAS gold in the Healthcare Artificial Intelligence: Data Science Solutions category. Industry heavyweight Epic came in a distant second. ClosedLoop repeats its 2022 win, with enviable scores.

"
ClosedLoop...earned an A+ or A in all customer experience areas: culture, loyalty, operations, product, relationship, and value.

"Further, 100 percent of customers surveyed said that ClosedLoop 'avoids charging for every little thing' and keeps all promises. About 96 percent said they would buy its solution again."

(But We Have a Better Halftime Show)


Sounds like they are gunning for our own pledge of Fanatical Support. Hope they don't hire Beyoncé to screen their calls.

February 9, 2023

Who's Speaking Up for Universal Healthcare? Well, ChatGPT for One

I've been enjoying reading Michael Mann's remarkable newsletter, "Planetary Health First Mars Next," available via LinkedIn. In today's issue, he asked ChatGPT what we could do to fix healthcare. The first response was to increase funding for medical research. The second and final response was to improve access to healthcare "by reducing the cost of insurance, expanding Medicaid, or creating a universal healthcare system."

He also got it to provide an extremely clear explanation of the Social Determinants of Health (SDoH).

I might have to change my mind about that little robot.

The newsletter also posted a link to a presentation by Russell Robbins, Chief Medical Information Officer at PurpleLab, discussing SDOH's impact on prescription medications, going beyond the conventional fill, reversal, and denial rates to address the harder-to-measure root causes through the lens of social determinants that underlie the missed med problem.

I've got a strong recommend rating on one of the smartest newsletters around. PurpleLab also looks like a cool company.

February 8, 2023

Why Do Biologics Have Such Funny Names?

If you still watch commercial television, chances are you've been lambasted with appeals to ask your doctor to prescribe you one of the new biologics coming out. The big print will feature the brand name, which is then repeated many times throughout the narrative. But the small print will give the generic name, which always seems to sound like a certain Phil Collins song.


Every year seems to bring a new parade of miracle cures, and every year the price of miracles seems to go up. I've started to refer to this trend as "Ransom-Level Pricing," because, at least in the US, the wonder drug revenue formula seems to be based on YMOYL.

I fully expect the next big med to be named after an actual rock and roll band.

What's the Rx Industry Expert Gab for 2023?

Death Cab For Cutie t-shirt
And, indeed, there is a site that blabs about all the money expected to be spent on the lab-tested snake oil in this year's pipeline. Or, if you'd rather limit your reading to a Fierce little summary, you could read an article about the drugs that will try to nab our hearts.

Or stab our kidneys. 

Or clear our minds, whatever.

But before you do even that, you might want to check out this fab decoder ring, which explains what all the suffix is about.

It's a -Mab -Mab -Mab -Mab World

Maybe the well-pharma wagon bringing just the medicine you need is coming down the street, right into your town, bearing a big shiny IV. You might even be one of the first to sign up for a jab!

 [And now, a word from our Sponsor: If you want to reach those doctors directly, check out the CarePrecise Enhanced Prescribing Clinician Fax Database™. Tell them Marty sent you.]

#
aducanumab #donanemab #epcoritamab #lecanemab #mirikizumab

February 1, 2023

How to Save Money on Healthcare Provider Data

It might seem like this is a shameless, self-serving promo for CarePrecise provider data packages. Unsurprisingly, our name does come up a lot when companies stagger away in shock from the prices our competitors charge. But that's not what this post is about. We're going to talk about (mostly) free data.

Hopefully this post will help you find provider data that's available for free from the U.S. government. Using free data you can boost the information value in any provider contact list. If you're working with a helpful data vendor, chances are they'll help you find where you can download particular kinds of data you're looking for. For instance, we have a lot of customers who use our basic hospital database who need additional components that we don't package with the product, but we know where to find them and we're glad to share our knowledge. 

Of course, we could pull all of that data into our hospital dataset, but there's SO much out there, and if we did that the product would be very expensive indeed. That database sells for $939 but would be a couple of orders of magnitude pricier with all of just the 70 U.S. hospital data files listed in just one spot on the Centers for Medicare and Medicaid Services (CMS) website.

So, instead of trying to pack everything in, we bring together the hard-to-find/basic-necessity data, and assist customers in finding additional information specific to their particular need. Here are some of our more common recommendations.

Search for healthcare provider data

When on the hunt for data gold, it can be painfully difficult to locate that needle in the haystack. The screenshot shows the count of the results of a search on the federal data website, data.gov, for "healthcare provider data." 127,500 datasets would be a daunting place to start digging. It's like, "Go get the gold! It's somewhere in that there mountain." Fortunately, we have had some experience with healthcare data excavation, and can often point our customers to pay dirt.

If you have talented data people, a good starting place is the NPPES dataset (National Plan and Provider Enumeration System), which contains about 7.4 million NPI records for individuals and organizations. The download file is much to large to use in ordinary office software, so your team will have to cut it into pieces. Or you can get the full NPPES already processed into a form to be used with Microsoft Office programs from CarePrecise. The CarePrecise product also contains additional data, such as sanctions, and whether or not a practitioner is enrolled to bill Medicare.

Once you have basic data on the providers, you'll want to add linkages between the clinicians and their practice groups and hospital affiliations. You can download the free Physician Compare database and have your tech team work its magic here, too, to make it useable on ordinary office computers. This used to be easier back when CMS included hospital information in the database, but now just to get all the hospital names and basic info you have to ingest ten additional datasets. The list is too big to include here, but highlights include the Licensed and Certified Healthcare Facility Listing where you'll find hospitals' CCN numbers matched to their names and addresses, and Medicare Inpatient Hospitals where you'll find some payment information. You'll want to head on back to CMS to pick up outpatient hospital info. These are just a few of the dozens of datasets we ingest on an ongoing basis to produce our monthly updates. For the datasets we monitor but don't regularly ingest, we're more than happy to help customers dig it up.

Hospital data is a bit easier to find and work with than practitioner data. For instance, the list of U.S. physicians is about 1.1 million doctors long, and that's too big to open in Excel. You'll need to get the physician files into a relational database for them to be very useful. If you're starting from the provider data catalog, you'll see the datasets for hospitals, home health agencies and other kinds of healthcare providers, as well as those doctors and other clinicians. You can also find physicians' CAHPS (patient experience metrics), as well as many of the types of procedures physicians perform.

Perhaps the best advice we find ourselves giving our customers who want to go it alone is to have a crackerjack tech team, or at least one person with a lot of database savvy, and start with buying a basic provider data product that you can use as a data structure template. Most federal data on clinicians is linked to their NPI number, so that's where you'll start building your relational database. Your next step is to talk with whoever sold you your basic data, and ask for help finding any missing components. CarePrecise prides itself on offering most of these, all ready to use, but some customers just enjoy the hunt, and even our most comprehensive data package can't contain everything you might want.

We don't shy away from telling our customers where they can find what they're looking for, even if the only place happens to be one of our competitors. In fact, CarePrecise data is compatible with data structures used across the industry. We even provide the Placekey for almost every record in our products, which connects our data with visitor traffic data and other Point of Interest (POI) products offered by other companies.

Many CarePrecise customers get our extended provider data package. CarePrecise Platinum has those elusive practice group and hospital affiliations, and software that makes it possible to get at exactly what you need without knowing anything about databases. It makes a great starting place for building your own bespoke database. 

About Updates

When you're finding and ingesting data, it's important to plan for updates. Some data sources are updated weekly, others monthly or quarterly, and some only on an annual basis. Create a table listing the resources and their update frequency, and build in the necessary automation to re-ingest them regularly.  This is especially important if your use case requires up-to-date information. This often overlooked step of building-in updates can be costly to do later on. Best if it's baked-in from the beginning. This includes your ingestion process for data you get from us, which you can automate to import the monthly or quarterly updates. We offer FTP delivery as an option, which can put the data directly onto your server, ready to be ingested by stored procedures that are triggered by the upload of the data, or by the modified date on the files.

If you want some help finding data sources, just speak with your CarePrecise representative. We may already have an affordable solution that will save you many hours of understanding an unfamiliar and often cryptic dataset. If we don't have it, your representative will help you find it.

One quick note... We offer these sourcing services to current CarePrecise subscribers. It would be great if we could open it up to everyone, but we have to keep our focus on our customers.