Happy Tuesday, Welcome back to another edition of healthcare news. Healthcare never sleeps, fam. Hospitalogy hits your inboxes every Tuesday (news roundup) and Thursday (deep dives)! Let's dive in. |
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Walmart and UnitedHealth team up on MA plans |
Retail overlord Walmart announced a deal with fellow healthcare overlord UnitedHealth to collaborate on Medicare Advantage plans. Over the next 10 years, the two incumbent giants will target the fast-growing Medicare Advantage population on a number of healthcare initiatives. High-Level details: - Term: Initial 10 years, seems like a bit of a pilot in the grand scheme of healthcare starting in 2023
- Walmart gets access Optum's platform, which appears to be analytics and decision support tools. Details are a bit hazy beyond that but I'm sure the partnership will expand over time. On top of the decision support platform, Walmart will conceivably look to build out its healthcare presence beyond the 15 Walmart Health locations mainly in Florida and Georgia
Madden's Musing: From a bigger picture perspective, it's extremely prudent for Walmart to continue to creep into the fast-growing MA space. In 2020, the retail giant partnered with Clover to launch MA plans in Georgia. On the other hand, its problems with its Walmart Health strategy and slowing rollout are well-documented. Optum is the best positioned partner to enable the transition to value-based care and help Walmart continue to push its healthcare strategy forward. Walmart is also known for having an expansive database of high-quality providers and recently integrated a machine learning tool, Health at Scale, to personalize healthcare provider directory recommendations to Walmart Health plans. Of most healthcare providers, Walmart has a distinct opportunity to fill in the gaps in rural healthcare. My burning question is whether this is just a loosey-goosey partnership or a collaboration with real teeth for the future. I also have to wonder if the increased push for social determinants of health and Medicare Advantage supplemental payments for things like groceries is responsible for retail players' continued pushes into healthcare (Amazon + Iora, Walgreens + VillageMD & CareCentrix, now Walmart + Optum). It's truly a no-brainer and incredibly synergistic to your business model if you can use an MA plan to push business to the rest of your company via government subsidies/payment. Walmart's push into MA health plans is somewhat damning for cash pay services as well - Initially, I thought Walmart Health was going to aggressively undercut insurers by offering competitive low prices and DTC cash pay, but it seems as if insurance wins again. Resources: - Link to Press Release
- Walmart, UNH ink 10yr collaboration deal on value-based care (Healthcare Dive)
- Walmart Launches Provider Recommendation Tool for Health Plan Members (HPI)
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UnitedHealth-Envision spat continues |
UnitedHealth Group continues to push Envision physicians out of network and denying claims. As a result, Envision is dropping lawsuit after lawsuit on UHG, this time in the state of Tennessee, stating that "United puts profits above all else." Ironic. Backstory: Envision and other physician staffing firms have long feuded with payors. Most recently in May, Envision sued UHG in Florida, calling it an 'evil empire' in the lawsuit's language and accusing the payor of underpaying its contracted reimbursement rates. It's pretty clear what UHG's strategy is here - using its negotiating leverage and the No Surprises Act to push high-cost providers out of network and try its luck in arbitration or other hospitalist groups. UHG continues to crowd Envision out of contracts, cutting emergency physicians from its network and claiming that Envision was asking for double to triple the median reimbursement rate of other ER/Anesthesia physicians. What's even more interesting is the discourse on social media surrounding high-cost physician staffing firms and payors. We're really kind of dealing with 2 devils here. On one hand, physicians, tired of dealing with insurers, are more inclined to side with the physician / provider side and are tired of getting generally squeezed by payors on reimbursement. On the cost side of the equation, folks have noted that insurers are actually doing their job in this instance by driving down high-cost providers (like PE-backed Envision), especially if they're charging double to triple the going rate. No matter your leaning on the topic, one thing is clear: Healthcare is hard, and the finger pointing is rampant. |
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Business and Strategy: - Optum quietly affiliated with another huge physician practice - CareMount, a 650 physician group, a few months ago. Someone help me point out the irony as Amy Klobuchar cries foul Amazon's acquisition of One Medical. "In the Tri-State region of New York, New Jersey, and Southern Connecticut, Optum includes CareMount Medical, ProHEALTH Care Associates, and Riverside Medical Group. Together our more than 2,100 providers serve over 1.6 million patients annually across 630 practice sites."
- Privia Health partnered with OhioHealth Health System - under the collab, Privia will help OHHS launch a medical group for independent physicians throughout the state of Ohio within OHHS' clinically integrated network and ACO. The partnership adds to Privia's growing list of affiliated health systems.
- Premier Health made an interesting, very under the radar move this week. For $177.5M, Its subsidiary Contigo acquired the rights to contracts that gives it access to 900,000 providers across 4.1 million diverse service locations (hospitals, ASCs, labs, imaging, etc.). Contigo seems to be making a very clear bet on the future of self-funded employer health plans to offer an extremely competitive product on an out-of-network coverage/wrap for these players looking to shake up at least a portion of the employer-sponsored, lucrative commercial market.
- Health Care Services Corp is collaborating with Teladoc to roll out a virtual primary care offering starting next year.
- New CEOs inbound:
- LifeStance Health appointed Ken Burdick, an executive with experience in the managed care space (WellCare, acquired by Centene), to CEO.
- Duly Health and Care, a huge, multi-specialty physician practice, appointed former UHG exec Tami Reller as CEO.
- Prime Healthcare Services completed its repurchase of 9 acute care hospitals and 2 MOBs from healthcare REIT Medical Properties Trust for about $360M.
- Prime Healthcare also partnered with Steer Health to launch its platform PrimeHealthNow, which will invest in better care coordination and other care delivery tools (patient scheduling, intake, etc).
- Following its merger with Vera Whole Health, the combined Castlight-Vera entity has rebranded into Apree Health
- Verily, a data-driven Alphabet (Google)-led venture into the life sciences space, raised $1B this week led by Alphabet itself.
Regulations and Rates: - The White House released an executive order stating its intention to incentivize biotech innovation through multiple initiatives.
- The AHA released a report on rural hospitals' long-term struggles and the dire need for policy change before access becomes an even bigger crisis.
- The HRSA released a list of total 340B drug purchases by entity type. In total, covered entities bought $43.9B worth of outpatient drugs under the 340B program, $34.2B of which stemmed from disproportionate share hospitals.
- The AHA also released commentary in support of the Saving Access to Laboratory Services Act - ahem…SALSA - Act to bolster laboratory reimbursement
Other: - This WSJ feature (paywall?) on the potential for ketamine in revolutionizing mental health treatment was fascinating. It's interesting to see a recreational drug and common anesthetic repurposed for depression and other disorders. Really entirely out of my wheelhouse here so it'll be interesting to watch!
- The Galleri blood test successfully found dozens of types of rare, early-stage cancers in a trial of 6,600 adults in a super promising turn for cancer detection. Super exciting stuff here. Next up - a 165,000-person trial!
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- So this was pretty cool - the great folks over at JTaylor invited me to be on their healthcare podcast (my first ever healthcare pod appearance) and I had a blast discussing the latest trends in healthcare with them across a number of the latest issues! They even bought me lunch afterward in Fort Worth. Class acts if you ask me. Listen to the podcast here.
- This was a good, deeper dive into the Atlanta Medical Center debacle I covered last week. The local Atlanta outlet does a good job of diving into the issues on both sides here.
- I really enjoyed this deep, long-form essay on Johnson & Johnson, consumer protections, and its talc defense.
- In other consumer protection long-form pieces, the NY Times dropped a piece (paywall - NYT) on Abbott Laboratories, Jones Day, and the powdered baby formula recall causing infant infection. Honestly I had no idea that Abbott had about 50% share in the $2.1B baby formula market.
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Here are some jobs that I'm curating for the healthcare industry. Use this link to submit your role to be featured if you're looking to hire. Director, Strategy and Transformation - Nursing, Option Care Health Option Care Health is looking for an individual to lead strategic initiatives in the Nursing Network and for Option Care Health nursing operations. Senior Business Analyst, Truepill Truepill is looking for a senior business analyst with 3+ years of experience to help with internal planning and product execution. Product Manager, Workflows, Zus Health Zus Health is looking for a hands-on, technical, healthcare-savvy product manager to help enable digital health providers and the next phase of interoperability. |
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- Even though Texas couldn't pull out the W over Bama this weekend, things are shifting down in Austin. Optimism is back. The fans applauded the efforts of the players trotting off the field after the game despite the heartbreaking loss. What a game! Although the entire team is now in injury shambles…proud to be a Longhorn regardless.
- Fyre Festival con artist Billy McFarland is out of jail and he's already plotting his next move (NYT paywall)! Incredible. Seriously, if you have an NY Times sub, this was a pretty solid read into McFarland's life post-Fyre.
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Thanks for the read! Let me know what you thought by replying back to this email. — Blake |
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