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  • Healthcare Startups: Common Mistakes and Lessons Learned-The HSB Blog 6/14/21

    Our Take: Telehealth usage is increasing at a rapid pace as are the number of startups who are commercializing the use of telemedicine and digital healthcare tools. There are common mistakes that these startups can avoid as they begin to operationalize these tools. Some of the most common mistakes pointed out by Forbes and our recent presentation in collaboration with Georgia Bio include lack of diverse leadership teams, improper networking, unfocused go-to-market plans, and inept founders and strategic partnerships. There are approximately 63,703 startups in the United States of which 2,500 are healthcare startups (as of 2019) with an overall failure rate of 90%. In order for startups to succeed and avoid the most common mistakes, they should prepare beforehand, and spend money in the initial phases which will eventually lead to more cost savings and success in the long run. Key Takeaways: Being coachable and being realistic about your limitations, understanding the sales cycle and customer discovery and being conservative and realistic as possible with investors are key skills for founders Despite lacking early capital, startups should look to advisory boards, non-dilutive funding often available through grants and their advisors network of connections While there were almost 64,000 startups in the U.S. in 2019 and 2500 healthcare startups, with a failure rate of approximately 90% While every startup has its own unique set of opportunities and challenges, many tend to repeat a common set of mistakes that can be looked at in a five-part framework: founding, strategy/vision, funding, execution, scaling or growth The Problem: Healthcare accounts for approximately 18% of U.S. GDP amounting to a $640B industry that is projected to reach $1.3T by 2025 according to Pitchbook. They estimate that enterprise health and wellness startups raised approximately $8.1B over 330 deals in 2020 which was up over 80% in dollar amount with average deal size increasing to $150M from approximately $37M. According to Venture Scanner there were approximately 2,500 healthcare startups in the United States as of 2019. According to Fallory 20% of startups fail after one year, 30% of startups fail within two years and 50% fail within five years and the overall failure rate for startups is 90%, While there are numerous general and unique reasons for startup failure, lack of success are often traced to errors made in the following areas: 1) the founding principles of the company, 2) strategy or vision, 3) funding, 4) execution of the business, and 5) scaling or growth of the business. The Backdrop: While digital health was already growing rapidly before the Coronavirus pandemic, with the arrival of the pandemic and the waiver of many regulations limiting telehealth, usage of telehealth and other digital health tools as well as funding rose dramatically. For example, in 2020, global investments in healthcare startups reached a new record of approximately $81 billion in equity funding across at least 5,500 deals in North America, Asia, and Europe. To look at what may separate the winners from the losers and what pitfalls current healthcare startups should seek to avoid, our founder Jeff Englander recently moderated a session at the Georgia Bio MedTech and Digital Innovation Summit. This panel , entitled, “Startups: Common Mistakes and Lessons Learned”, featured Mr. Englander, Steve Tolle, partner at HLM Venture Partners and Nakia Melecio, Startup Catalyst at the Advanced Technology Development Center (ATDC) of the Georgia Institute of Technology. Using the framework noted above, the discussion highlighted a number of issues. With respect to issues that arise when founding a company Mr. Tolle noted that one of the biggest mistakes he sees is founders lacking or losing focus and failing to have a unique value proposition, Mr. Englander added that in finding your company’s own unique value proposition, startups should not seek to imitate the latest and greatest success as each company is unique. Mr. Melecio noted that new companies, particularly those that are making use of a university incubator or accelerator often fail to take advantage of all of the resources made available to them like subject matter experts (SMEs), executives-in-residence (EIRs), technology transfer assistance, etc. In terms of strategy and vision, two risks that were noted were the “celebrity CEO syndrome” and the “shiny penny syndrome”. Mr. Melecio defined the celebrity CEO syndrome as “where the hype around the founder doesn’t match the hype around the tech”, adding that “the technology and the problem you’re trying to solve should be the rock star”. Mr. Tolle defined “shiny penny syndrome” as startups letting their strategy get corrupted away from the original intent of the business by “going after something just because someone else got it”, not because it helps you reach your goals. Continuing with the five point framework, the panel then looked at the issue of funding. Mr. Englander began the discussion by noting that although the recent interest in healthtech and accompanying high valuations are often perceived as a positive they can have a downside as well. Mr. Tolle agreed noting in highly valued market like this companies may often stretch for an artificially high valuation but that may hurt them later. In addition, Mr. Tolle noted that many companies often make a mistake by taking too much convertible debt initially leading to valuation issues or problems should they need to raise money later. Mr. Melecio stressed that startups, particularly those that are coming out of academic labs, often fail to take advantage of non-dilutive financing and fail to de-risk their investment by accomplishing as many milestones as possible before seeking institutional funding. Mr. Englander also raised the issue of new entrants like private equity entering the market and potential risks that entailed. Mr. Tolle added that companies often don’t differentiate between the underwriting criteria that venture capital and private equity investors have to underwrite too and that can be a mistake. As companies move from the funding of business plan to execution phase the panelists noted a number of issues they should address. Mr. Englander noted that many companies lack a strong operating person or COO to maintain the focus necessary (noted earlier) and keep the company following its business plan. Mr. Melecio advised that many founders are not “honest with themselves about their limitations” and often neglect to consider bringing in a talent advisor or human resources consultant to advise them on helping find the right personnel for the business and help the founders evaluate their own roles within the company as it grows. Along those lines, Mr. Tolle pointed out that many startups often lack formal advisory boards and fail to meet with them regularly, suggesting that founders often rely on friends and family who are not true experts and who will not “speak truth to power”. Finally, in terms of the scaling or growth phase, Mr. Tolle advised that too often startups think nationally, advising startups to remember “healthcare is still a very regional and local thing, it is a lot of word of mouth between hospital CEOs or between hospital CIOs, or between providers.” Mr. Melecio also cautioned that as they grow company’s too often lose sight of “what problem they're trying to solve and ensuring how close the alignment is between your business model and their business model.” Mr. Englander and Mr. Tolle stressed that startups often make the mistake of giving away too much when trying to land a big contract with major partners, particularly those that are asking for exclusives to become part of their vendor network. Implications: Healthcare startups have an increasingly high failure rate given the risk averse culture, the siloed nature of the industry and the length of the sales cycle. However future founders can learn from the mistakes of previous startups and use them as lessons learned as they move forth with their new ventures. Keeping with the five part framework outlined earlier, below are some steps that startups can take to address the common pitfalls, to help ease the sales process and increase chances of longevity and success according to Englander, Tolle and Melecio. In terms of founding a company, Tolle stressed the importance of “getting traction” and that in healthcare “adoption is always the hardest part”. Mr. Englander noted the importance of startups taking the time to understand what they are really good at and positioning that correctly in the ecosystem. Mr. Melecio cautioned that for academically driven startups it is important to know where the IP will sit in the market, what it will be valued at and which tools may be open source and which ones you can protect. As they move forward into developing a strategy and vision, Mr. Tolle recommends the importance of “having a plan and critically and conservatively assessing where you are against that plan.” Mr. Melecio advises new healthtech companies to keep in mind that strategy is very different for every technology “drug discovery, medical devices, etc. all have very different runways, different pathways, and intent regulatory environments...you have to think about healthcare in its entirety and its whole value chain.” In terms of funding Mr. Tolle advised startups to be conservative in doing Series A and B rounds, particularly if they expect to need additional funding as of they get a valuation they have to “grow into” it can cause them to have to do a future down round which could lead to conditions and structures that would hurt them in the future. In addition he advised seeking to align themselves with angel or family office investors who are often more mission driven than institutional investors. Mr. Melecio stressed the advantages of Small Business Innovation Research (SBIR) and Small Business Technology Transfer Program (STTR) funds and other non-dilutive sources that allow emerging companies to run pilots and work and hit milestones thus de-risking the technology before going for institutional investment. With respect to execution both Mr. Englander and Mr. Tolle cited the need for operating talent but differed on ways to acquire the expertise. Mr. Englander suggested analyzing founders skill set or hiring a dedicated person with operating expertise, while Mr. Tolle suggested looking at a fractional hire. He added that “having the discipline [in sales forecasting] to know when to call something at a different stage in your pipeline and someone with the skill to do that is really important. As noted earlier, Mr. Melecio noted the importance of a dedicated talent advisor to both analyze the needs of the company as a whole and the skillset of the founders to determine if more permanent help at the senior level needs to be brought in. When looking at what new healthtech ventures can do to avoid pitfalls during the scaling or growth phase, Mr. Tolle strongly recommends the use of a formal advisory board that meets regularly, potentially with an ex industry executive who can help you in the market when you need it. All of the speakers noted the importance of drawing upon advisors and consultants who have strong networks who help you in growing your business. Along those lines, citing the local/regional nature of healthcare in general, Mr. Tolle advocated establishing “regional beachheads” to gain traction, pointing out that a startup's “best salesperson is often a customer talking to a friend of theirs on the golf course or at a conference.” In addition, Mr. Tolle also cautioned that when contemplating a partnership with an established industry player, consider how they are aligned to your business and how they will get paid for talking about your business observing that if there is no alignment it is unlikely to benefit your business. Finally, each of the panelists were asked to give some parting advice about actions startups could take to avoid mistakes going forward. Mr. Tolle advocated founders being “as conservative and realistic as possible when talking to investors”, Mr. Melecio emphasized the importance of understanding the sales cycle, the basics of customer discovery, understanding the healthcare ecosystem (who you’re talking to and why) and who’s paying for it. Mr. Englander concurred with earlier comments about founders being coachable and highlighted “the importance of being honest with yourself and your limitations” in order to be able to recognize when they needed help.

  • Scouting Report-NUE Life Health: Taking Ketamine from Party Drug to Effective Depression Treatment

    The Driver: NUE Life Health, a telemental wellness platform, raised $3.3 M in funding from investors including Jack Abraham, Shervin Pishevar, Martin Varsavsky, Jon Oringer, James Bailey, and Christina Getty. Founded in Miami, NUE Life uses the oral form of ketamine, Esketamine which was approved by the FDA in March and is given as a nasal spray. NUE Life has operations in California, Texas, and Florida and aims to expand its services with the new funding. The Takeaways: Although ketamine has been associated with being a “party drug” and was once used mainly as an anesthetic on battlefields and in operating rooms, it may hold promise for those who have not had success on other medications. While researchers don’t know exactly how it works, “a leading theory proposes that it stimulates regrowth of synapses (connections between neurons), effectively rewiring the brain.” The company believes ketamine will strengthen the neural connections weakened by chronic stress and depression thus allowing newer connections to form. Because ketamine uses a new mechanism to deliver its antidepressant effects, it may be able to offer help for those people whose depression has resisted previous interventions. The Story: Christina Getty, a co-founder, and investor in NUE Life Health stated that with approximately 20% of women in the U.S. on antidepressants and over 20 veterans a day committing suicide, they “felt compelled to launch a different kind of mental wellness company.” NUE Life offers treatment for major depression, anxiety, post-traumatic stress disorder, and bipolar disorder. Ketamine therapy itself is unique to the individual as there are variations in experiences, duration, absorbability, and dosage. NUE Life offers three different programs: Basic, Stabilize or Complete which offers a differing number of “experiences” (dosage). On their website, NUE Life listed their pricing which ranges from $850 for the Basic program to $2,750 for the Complete program. Currently, insurance does not cover ketamine-assisted therapy with NUE Life. The Differentiator(s): While COVID-19 gave rise to many telemental health platforms, NUE Life is offering at-home ketamine therapy combined with Artificial Intelligence recommended music therapy and treatment plan(s). According to an article in Psychedelic Spotlight, patients who are open to music therapy are more likely to experience lesser symptoms of depression than those who are not open to music therapy. According to the company, NUE Life “creates a detailed ‘knowledge graph’ of the patient which allows it to understand everything about them in order to diagnose and treat their mental health condition, using an approach called integrated psychiatry.” NUE Life most often ends up recommending the Stabilize program. This program contains 6 experiences that NUE Life suggests be taken twice per week over a period of 3 weeks. Depending on the patient’s needs, the program can assist patients with up to 18 experiences over 3 months. According to a report in the Harvard Health Blog, “people who experience some relief from depression within one to three ketamine treatments are probably likely to extend these positive effects if the treatment is repeated several more times”. However, the blog goes on to say there are now standard dosage guidelines and “the subsequent sessions may help prolong the effect of ketamine, rather than achieving further dramatic relief of symptoms.” The ketamine tablet is to be administered orally after completing the initial screening and sitter agreement form. During the experience, patients are asked to fill out their “experience tracker” which is followed up with NUE Life’s Medical Director. The platform creates the above mentioned Knowledge Graph that illustrates the patient’s mental health condition, diagnosis, and ongoing treatments. The HIPAA compliant platform will also provide the patients access to a community where they can resume their treatment even after completing the program. The Big Picture: Currently, ketamine-assisted therapy is the fastest-acting antidepressant for major depression. Focused on providing holistic mental wellness services, NUE Life taps into three key areas “mind, body, and lifestyle” which are essential for mental health wellbeing in the long run. NUE Life offers sustainable relief from mental health conditions as it disrupts negative thought patterns and guides patients into forming healthier neural connections. Patients are able to access NUE Life from the comfort of their homes and are able to partake in their daily activities, as there are no long-term side effects from ketamine. The traditional therapy approaches often risk poor compliance and outcomes leading to treatment-resistant depression (TRD). According to BMC Psychiatry, treatment resistance occurs commonly in up to 30% of those treated for major depressive disorder. In addition, the Society of Biological Psychiatry, reports that TRD is relatively common where at least 50-60% of the patients report poor health outcomes. As there is an existing gap in research surrounding the biology of depression, the traditional treatments haven’t proven to be very effective. A patient’s health status, age, and gender are factors associated with the probability of TRD, where women and senior citizens experience TRD at higher rates. NUE Life has the potential to help alleviate the mental health burdens on vulnerable populations by offering a sustainable and quick treatment plan. Ketamine For Major Depression: New tool, New Questions; NUE Life Health Raises $3.3M For Its Psychedelics-Meets-Tech Mental Wellness platform

  • Biden’s Plan to End Cancer Won’t Succeed Without Social Infrastructure-The HSB Blog 6/7/21

    Our Take: Though President Biden’s proposed new biomedical research agency (Advanced Research Projects Agency for Health or ARPA-H, modeled on DARPA (which is credited with creating the internet) can provide “cutting edge solutions” unless healthcare’s underlying social infrastructure issues are addressed first, the initiative will not succeed. While President Biden has proposed this initiative to potentially eradicate major diseases such as cancer, Alzheimer’s disease, and diabetes, the plan will have to reach populations most impacted by these and other chronic conditions who are often those most impacted by significant health disparities. As such, the success of such a plan will be a function of President Biden’s American Job’s Plan which expands the traditional definition of infrastructure (ex: roads, bridges, ports, etc.) to include other human infrastructure elements such as broadband, childcare, and skills training. While we would not argue that every provision of the initial proposal must pass or would qualify as infrastructure even in a modern sense, we must expand our definition beyond the traditional definition for ARPA-H to succeed. Key Takeaways: Modeled after the Defense Advanced Research Projects Agency (DARPA) the ARPA-H is a high-risk, high-rewards development agency aimed at enhancing medical advancements without the limitations of bureaucratic red tape. While only one example, a recent study found the social determinants of health in Texas have resulted in $2.7 billion in excess medical spending, and another $5 billion in lost productivity. The budget of ARPA-H is tied to the National Institutes of Health (NIH) where $6.5 billion is reserved for ARPA-H. With the many competing demands on the NIH budget many researchers have urged the existing functions of the NIH be protected and suggested that healthcare-related research remain grounded in clinical trials and testing. The Problem: ARPA-H’s goals are to eradicate chronic conditions and, essentially, to improve overall population health. In order to improve population health, the definition of infrastructure must also include human infrastructure improvements such as programming and resources that also improve access to education, resources, food and water, and healthcare services. As demonstrated by the COVID pandemic, while there can be dramatic breakthroughs in healthcare and healthcare technology, these developments often bypass the underserved and increase disparities. For example, although there was a dramatic increase in healthtech funding during COVID and there was a surge in the number of telemedicine and remote care services to address healthcare needs due to the lack of in-person care, people of color were inordinately impacted by COVID and often were disproportionately unable to utilize these advancements. These disparities were evident even prior to the COVID crisis and appear to have been magnified by it. For example, data from the National Telecommunications and Information Association revealed that “the proportion of households that accessed health or health insurance records online grew from 30 percent in 2017 to 34 percent in 2019” that “households communicating with a health professional online increased by two percentage points, and households that researched health information online grew by one percentage point between 2017 and 2019.” However this data also revealed that a majority of those who used telehealth and telemedicine type resources were higher educated, wealthier and lived in more metropolitan areas. In addition to broadband, issues like child care and prenatal care can contribute to healthcare disparities all of which hurt us economically. For example, in Texas, Black and Hispanic children are more likely to grow up in neighborhoods of poverty and their families are more likely to lack health insurance, causing large disparities in health status, disease prevalence, and premature death. According to Episcopal Health Foundation, Texas is incurring $2.7 billion in excess medical care spending annually as well as $5 billion in lost productivity due issues associated with social determinants of health. In addition, this lack of care leads to 452,000 life years lost due to premature deaths valued at $22.6 billion. The Backdrop: The first step to addressing the lack of broadband access and other disparities is to redefine what infrastructure means as noted by President Biden when he unveiled his proposal in the American Jobs Plan. The plan redefines what infrastructure means in modern-day America, placing an emphasis on improving infrastructure for both child and home health care. The care infrastructure notion entails improving access to healthcare services, clean water, and broadband enhancements; these elements are important to promote health and wellbeing for all Americans. Given the digital nature of our society broadband is at the heart of many problems that impact healthcare and social determinants of health. For example, according to USA Today, prior to the pandemic an estimated 10-16M of the nation’s school age children completely lacked access to the internet to aid them in their school work. Even for those that do have access, the situation may not be all that it seems. In 2019, Microsoft released a study illustrating that at least 163.2 million Americans are not accessing broadband at its optimal speed. The study, backed by 6 different independent studies, foreshadowed America's system inefficiencies marking the correlation between broadband access, and job and GDP growth. This lack of broadband access also impacts health as many health experts now have begun to classify broadband access as a “super-special” determinant of health. This is due to the fact that broadband access is needed to book appointments, monitor bus schedules and ride-share apps, navigate the health insurance platforms, and so on. The lack of broadband access has put the burden of care back onto the consumers. As a result, this can lead to consumers in underserved communities facing higher barriers to access and or even becoming unable to access digital health platforms entirely. In fact, data from the National Telecommunications and Information Administration indicate that only 12% of those with an annual household income of $25,000 or less used the internet to communicate with their healthcare provider compared to 40% of those making $100,000 or more in 2019. Hispanic, American Native/Alaska Native and African Americans had the lowest rate of internet use for health related activities, trailing White and Asian Americans. Similarly, these racial groups also represented some of the most underserved populations in America. Implications: Redefining what infrastructure means is an uphill battle. Edward Glaeser, a Harvard University economist working on infrastructure projects for the National Bureau of Economic Research, noted that a cost-benefit analysis must be established with each proposed program to fully grasp the impact of the proposed care/human infrastructure. We risk increasing racial and health inequities if the lack of broadband access and other care infrastructure programs do not pass. In addition to this digital divide, there is also a large inequity among those suffering from chronic diseases such as cancer and diabetes and other diseases. For example, over 40% of Black females suffer from hypertension and over 10% have diabetes. Prevalence rates of many chronic diseases like these are concentrated among those who are less affluent. As noted in a 2020 study published in Health Affairs, there is a strong correlation between socioeconomic status, patient care access, and lack of health insurance and rural living. Telehealth is a vital tool and in fact one of the advancements like those envisioned by ARPA-H to improve the quality and delivery of health care to millions of underserved Americans. The proposed ARPA-H program and its mission to “end cancer” have potential but it will not reach those who are truly impacted unless it addresses issues like broadband access, education and childcare. As noted in the earlier example of Texas, the state is incurring almost $3B in additional medical costs and $5B in lost productivity. Any CFO facing a similar decision about factory equipment which would save a significant amount of money and effectively extend the useful life of the equipment would be hard pressed not to make it. Lastly, health experts agree that for an improvement in population health and to sustain the positive influence of these interventions and medical advancements, health literacy must be prioritized. The social and super special determinants of health must be sustainably addressed to close the racial and health gaps amongst Americans. Related Reading: In His Biggest Speech Yet, Biden Pitches a New Health Agency to Help ‘End Cancer As We Know It’ President Biden Proposes Creating Two DARPA-Like Agencies Biden Plan Spurs Fight Over What ‘Infrastructure’ Really Means Economic Impacts of Health Disparities in Texas 2020

  • Scouting Report-Clearing: Addressing Non-Addictive Pain Management

    The Driver: Clearing is developing a digital healthcare platform for chronic pain sufferers looking for non-opioid pain relief. According to Crunchbase News the New-York based company recently raised $20 million in a seed round led by Bessemer Venture Partners and Founders Fund with additional backing by Flatiron Health, Curology, Hims & Hers, Seamless, Grubhub, and Forward Health. With the funding, Clearing plans to address the chronic pain market’s shortage of pain specialists, by prescribing patients non-addictive treatment plans. As noted by CrunchBase, Clearing is moving the pain management market online and then combining clinician visits with a combination of affordable physical therapy and compound pharmacy programs. Clearing claims to already have 10,000 patients on their waiting list and the company hopes to expand its platform and work with sports teams and other medical professionals. The Takeaways: According to the CDC 1 in 5 or 50M Americans suffer from chronic pain, yet there are currently only 7,000 pain specialists in the U.S. Chronic pain causes loss of productivity and costs America up to $635 million, a year according to American Health & Drug Benefits. Although there were a number of root causes of the opioid epidemic, part of it can be attributed to the fact that prescribing opioids was cheaper than detailed pain management plans which require multiple visits and referrals Approximately “70% of chronic pain sufferers reported an increase in chronic pain” during the pandemic due to disruptions in care and the need for non-addictive pain management plans. The Story: According to the CEO and Founder, Avi Dorfman, each year an additional 2 million Americans are added to the roles of those with chronic pain and in need of pain management plans.. Clearing offers “stage one intervention” or holistic treatment plans with non-addictive elements which includes anti-inflammatory creams and at-home exercises. The ingredients in the topical pain relievers (creams) are FDA approved and the prescription strength can be adjusted according to the patient’s needs. Importantly, Clearing does not require insurance plans as their treatment plans are extremely cost effective and cost less than typical insurance copayments. According to the company, after completing a virtual consultation, patients are paired up with a pain management specialist who prescribes a comprehensive plan and follows up with the patients on a regular basis. The direct-to-consumer platform delivers their prescription right to the patient’s doorstep, eliminating the hassle of having to pick up prescriptions. One notable risk is that CEO and Founder, Avi Dorfman is currently in the midst of a jury trial to validate his status and ownership stake in Compass, a real estate brokerage platform. Given his role as CEO this could divert management attention and focus at Clearing as he prepares for and participates in the trial. The Differentiators: Currently, Clearing is the first digital platform to offer comprehensive pain management at a low price point. This is particularly important because the digital aspect of Clearing can make pain management accessible to millions of Americans, particularly the underresourced, who may currently lack health insurance. Clearing validates its treatment protocols through the use of a medical advisory board that has accumulated over 150 years of combined experiences and represents leading medical institutions such as Mass General, Johns Hopkins and Harvard. The company notes that the medical advisory board demonstrates a clear understanding of pain management and its members have authored over 465 peer-reviewed journals on chronic pain. The platform relies on self-assessment of the patient’s pain-level and symptoms. Moreover, given the role that patient self assessment plays in the Clearing platform it has the potential to alleviate some of the racial and gender bias patients often face when doctors conduct pain assessments. A number of studies have demonstrated that black patients are consistently undertreated for pain due to false beliefs held by doctors. In addition, though women are disproportionately affected by conditions that cause chronic pain, several studies have demonstrated that they are less likely to be properly diagnosed or receive proper pain management treatment than their male counterparts. The Big Picture: As noted above, chronic pain impacts the quality of life for over 50 million Americans and has been clinically linked to depression and anxiety and other behavioral health disorders. During the COVID pandemic where access to in-person care was difficult or impossible for many, access to medication and providers who could help alleviate this pain disappeared and the need for comprehensive pain management via telemedicine emerged. Clearing’s direct-to-consumer digital platform is less likely to be disrupted by external factors and can simultaneously help address the shortage of pain management specialists. In addition, many lack insurance or cannot afford the high costs of insurance deductibles or co-pays, Clearing’s low-cost direct model offers an affordable and efficient solution. Clearing aims to provide pain relief for millions of Americans without adding to their expenses. Moreover given the movement towards increased consumerism in healthcare, Clearing offers a straightforward platform allowing patients to self-assess their pain levels without having to get caught in the healthcare coverage/reimbursement maze. This should reduce barriers in accessing pain management treatment plans for people of color and women and result in improved care at lower costs. Clearing Targets Chronic Pain With $20M Seed & Clearing Revolutionizes Relief for Millions of Americans Suffering from Chronic Pain

  • Fixing the Female Venture Funding Gap Will Boost Innovation and Returns-The HSB Blog 5/24/21

    Our Take: An increase of women’s representation on both ends of venture capital-investments and startup entrepreneurship- will result in substantive benefits. By providing opportunities for women-founded companies, venture capitalists create room for billions of dollars in GDP growth and work toward closing the gender gap. Differently, if left undealt with, the lack of women in tech roles could have detrimental effects on the economy, rewind the progress made in gender equity, as well as stunt the growth of industries where women compose large portions of users and intuitively help drive innovation such as healthcare. Although the recent COVID-19 pandemic revealed and exacerbated cracks in venture capital, there are a few areas where improvements can be made to solve this issue such as hiring more women into leadership roles in venture capital firms and supporting women founded startups. Key Takeaways: Despite almost a 15% increase in venture funding in 2020, women-founded companies raised just 2.2% of the total, down from only 2.6% in 2019 For every $1 in funding, women-founded companies returned more than 2.5x in revenues per dollar invested than companies founded by men Women venture capitalists are twice as likely to invest in women founded companies Gender-neutral venture evaluation is a false premise. Investor standards are applied in gendered ways and female entrepreneurs must be prepared to navigate within this flawed system The Problem: As noted in an article entitled Venture Capital Funding Boomed in 2020. But Women’s Share of the Pie Shrank to 2.2%, while venture capitalists raised a total of $150 billion in 2020, a 13% increase from 2019, startups founded by women were left behind. For example, while venture funding increased 13% in 2020, women-founded companies raised just 2.2% of the total, a slight decrease from the 2.6% of total venture funds raised in 2019. By contrast, the percentage of venture capital funds allocated to male-founded companies increased to 85.8% from 83.5% in 2020. While there isn’t yet a clear understanding for this year’s drop in venture capital received by women-founded companies, many have speculated it is related to the continued effects of the COVID-19 pandemic and women’s roles as primary caregivers for children and family. The Backdrop: From child care to caring for sick family members, women’s lives were disproportionately affected by the pandemic in 2020. A Harvard Business Review analysis showed that women’s jobs were 1.8 times more likely to be affected than men’s jobs. Furthermore, even though women make up only 39% of the global employment, they were affected by over 50% of the job losses in 2020. The loss of women in employment has major repercussions not only on gender equity but on the economy as a whole. According to a Boston Consulting Group analysis, for every $1 in funding, women founded companies returned more than 2.5x in revenues per dollar invested than companies founded by men. Although according to the U.S. Census Bureau women hold more than three quarters of healthcare jobs, an Oliver Wyman study showed women hold only 13% of CEO roles and 33% of leadership positions. Furthermore, as one looks at the leadership of venture capital firms, there is a minimal women’s presence. Many women serve as associates and analysts but only 12% of decision makers at venture capital firms are women, while many don’t have any female partners at all. An analysis conducted by All Raise found that only 27 women joined venture capital firms in 2020 compared to 54 in 2019. Of these 27 women, only one woman was Black while none identified as Latinx. All Raise founder Pam Kostka named another impact of the COVID-19 pandemic that affected women in venture capital; due to social distancing, fear and increasing illness, less networking events occurred that allowed women to network and promote their ideas. Kostka called this inability to connect with new startups, “known founder effect”, where investors essentially stuck to what and who they knew prior to 2020 which, in a historically male dominated field, means men. This was best illustrated by the increase of funding given to later-stage deals in comparison to such in 2019. Harvard Business Review writers, Ashley Bittner and Brigette Lau, likened the current state of the venture capital community to a “boys club”, making it even more difficult for women founders to participate. An article entitled, Why Women-Owned Startups Are a Better Bet, looked at why the disparity exists in venture capital and came to three conclusions. First, women generally received more pushback and challenges during their presentations when compared with men and were less likely to directly address criticism. This was particularly true around the amount of technical knowledge they possess regarding their own ideas. Secondly, men were more likely to over-sell themselves and their ideas during pitches while women remained generally conservative- even asking for less than men. Lastly, male venture capitalists were generally less familiar with the services and products that women were founding. As one founder noted in the article “this lack of understanding shows up also in terms of social class when entrepreneurs pitch products for people at socioeconomic levels significantly lower than that of the typical angel or VC investor.” Implications: The lack of women in venture capital has a number of effects that if left unaddressed may lead to an undoing of progress in social equity, contribute to a continued lack of diversity in the workforce and potentially leave a number of market opportunities poorly addressed or even unaddressed entirely. This issue is one that is representative of matters of gender inequity, difficulties in women’s employment, and minimal growth of women in leadership roles across the industry. For example, since studies show that women venture capitalists are twice as likely to invest in women-founded companies, women who have the means to do so are empowered to build a virtuous cycle by starting their own firms and even their own venture capital firms. Women owned firms also help increase diversity in the workforce as they tend to fill their staff with 2.5 times more women and these startups often have social (as well as financial) missions that create lasting, long term impacts for others. When women create, they create companies that focus on making social contributions and build healthy relationships with employees. Also, as noted by Frost, “with 50% of the global population as target customers and a market potential of $50 billion by 2025” female entrepreneurs are ideally positioned to capture a good portion of this market. Failing to empower them to do so would clearly lead to missed opportunities. That being the case, what can be done to improve the amount of capital directed towards female founders? The 2018 Canada-United States Council for Advancement of Women Entrepreneurs and Business Leaders Report on increasing women’s access to capital recommended the following things, among others, 1) given that female entrepreneurs ask on average for $89,000 in debt financing while males ask for $124,500 lending institutions must work with female entrepreneurs by shifting their conversation from a transactional one to a strategic one; 2) examining the business plan to assess which amount of capital can be reasonably required given the business potential; 3) lenders could be encouraged to invest concomitantly with government-funded loans, as well as cooperate with their female entrepreneur customers to seek out lower cost financing sources that, in turn, can be leveraged further with private debt; 4) Governments…should continue to pursue programs that ensure female-owned businesses are included in Government tender processes on a preferred basis. In addition, a recent article in the MIT Sloan Management Review entitled, How Women Can Improve Their Venture Pitch Outcomes, noted that in dialogues where women stress risk, the likelihood of obtaining a positive funding proposal was significantly reduced. Avoiding words such as ‘risk’ and ‘defend’ increased the likelihood of women getting what they were asking for. In addition, based on the difference in perception by investors the authors suggested that female entrepreneurs specifically focus on promoting goals and upsides rather than highlighting how they will prevent downsides. Moreover the article noted that female founders are encouraged to do their homework on the gender composition of investors well in advance of pitching their ideas and they should go in being prepared to shift their pitch so as to ensure a focus promoting returns. As the authors note in concluding the article, “these findings indicate that gender-neutral venture evaluation is a false premise ...our results show that investor standards are applied in gendered ways.” As such, female entrepreneurs must be prepared to “navigate within this flawed system” to increase chances of success. Related Reading: Venture Capital Funding Boomed in 2020. But Women’s Share of the Pie Shrank to 2.2% Women-Led Startups Received Just 2.3% of VC Funding in 2020 Achieving a Better Gender Balance Across All Levels of an Organization Why Women-Owned Startups Are a Better Bet COVID-19 and Gender Equality: Countering the Regressive Effects

  • Scouting Report-RubiconMD: An Integrated e-Consult Platform, Reducing Barriers and Costs

    The Driver: The explosion of growth in telemedicine during the COVID pandemic gave rise to a corresponding increase in demand for additional services like second opinions and e-consults. As increasing amounts of care shifted to virtual delivery, payers soon realized they had to look at managing the costs of specialty care and turned to providers of second opinions and online or e-consults like RubiconMD. Rubicon, which raised an additional $18M in a Series C funding in March 2020 just before the pandemic, has raised $40M to date backed by Deerfield Management Co. and existing investors, Optum Ventures, HLM Venture Partners, Waterline Ventures, and Heritage Provider Network. The Entrepreneurial Insights: When dealing with the underserved, it's incredibly important to understand the cultural and social context of products designed for them. Early on during COVID as virtual healthcare took hold it actually exacerbated health inequities, however, gradually disparities became more broadly recognized and inequalities are slowly being addressed although there is still much more work to be done. The U.S. had a mental health crisis before the pandemic hit and still has a mental health crisis that requires more holistic/integrated care for patients Many healthcare organizations falsely assume that they can’t make money by creating products or services specific to underserved populations. The Story: Founded in 2013 by CEO Gil Addo and President Carlos Reines, RubiconMD enables primary care doctors to electronically consult with specialists in order to determine appropriate treatment protocols, care plans and if needed an in-person appointments with a specialist. One of the company’s primary missions is to eliminate barriers to specialty care given that underresourced patients must often confront the obstacles of transportation costs, time off from work and an inability to determine medical need when evaluating the need for specialty care. We spoke with RubiconMD CEO Gil Addo who stressed their recognition of the urgency of bringing their vision to reality with the onset of the pandemic and the civil unrest shining a light on the existing health care disparities. RubiconMD is currently in operation in 37 States and covers 130 specialties and subspecialties. RubiconMD hires verified specialists who are academic clinicians and well-versed in current practices and methodologies for its second opinions. RubiconMD’s specialists fill in the “second opinion” gap and provide clinicians with the best possible solutions for each case, allowing the PCPs to make the final decision. There are significant costs associated with referring patients to a medical specialist and it has proven to be a barrier for the best standard of care for patients. RubiconMD’s e-consult visit improves patient’s health outcomes, increases satisfaction, and reduces healthcare spending. Moreover, RubiconMD is adding to and reinforcing general practitioners’ knowledge of current practices which boosts confidence when treating patients. RubiconMD has found that patients often do not need an in-person visit with a specialist and can be more effectively treated with continued monitoring and additional follow up care. When necessary they are referred to a specialist. The Differentiator(s): According to Addo, most Rubicon e-consults have a response time of 3 hours since RubiconMD retains over 300 specialists and connects them directly with clinicians. Rubicon’s e-consult platform significantly cuts healthcare costs by avoiding the unnecessary referrals, additional testing and lab services often associated with referrals to specialists as well as proactively reducing ER utilization through early detection and improved care protocols. RubiconMD provides clinicians with the best possible solutions for their complicated cases. It improves patient care by 80% and reduces healthcare spending. Addo was proud to report that a recent claims-based analysis of Rubicon’s e-consults from a national payer-partner over a two year period, found a 50% lower per member per month cost for patients where an e-consult was conducted, which persisted over the entire two year period. Addo has noted that “we are in a major mental health crisis in this country, there is a dramatic lack of supply [of mental health professionals] in this country” and mental health conditions are a major driver of costs in the healthcare system. The Big Picture: The U.S. has one of the highest rates of healthcare expenditure at almost 20% of GDP of which a large portion is often attributed to the practice of defensive/invasive medicine. In addition, the COVID pandemic has highlighted the presence of significant inequities of access to healthcare and disparities in levels of health literacy. RubiconMD is working to shift the narrative by facilitating how medicine can be practiced less defensively and more equitably in the U.S. as the use of telemedicine and virtual care becomes cemented into our healthcare delivery system. Rubicon will also help address the U.S. physician shortage and particularly the scarcity of specialists predicted by the American Association of Medical College predicts to be between 34,000 and 87,000 positions. Rubicon has had great success in expanding access to practitioners in fields such as orthopedics, cardiology, general pediatrics, and more, in underserved and rural areas thereby improving access to convenient high-quality care. RubiconMD has also seen the need to broaden its footprint to include holistic care of a patient’s physical and mental health. Patient’s direct mental health expenditures account for only 5% of healthcare expenditures while those same patients' health related expenditures can account for up to 60% of all healthcare expenses. Finally, given their success in reaching patients impacted by disparities, Rubicon has demonstrated that as noted in the words of CEO Addo, “when dealing with the underserved, it is incredibly important to understand the cultural and social context of products designed for them” not just redesign or repurpose products designed for other populations. RubiconMD Launches COVID-19 Vaccine eConsults and Resources to Improve Access to Latest Vaccine Insights, The Confident Generalist: Putting The Primary Care Physician Back At The Center

  • Reducing AI Biases in Healthcare: Follow These Four Steps-The HSB Blog 5/17/21

    Key Takeaways: With increased interdependence of medicine and data sciences, new physician/data scientists are needed to help develop and audit AI models, Most data fed into AI tools tend to be homogeneous patient populations, thus companies must institute frameworks for responsible data use. Minimizing racial and ethnic bias in AI requires auditing both the development and output of models to ensure their clinical accuracy and relevance. Transparency and explainability, particularly around data privacy and security will be key in ensuring trust in models The Problem: AI systems contain biases for many reasons, two very common ones are 1) cognitive biases and 2) incomplete data sets. According to Verywell Mind a cognitive bias is a systematic error in thinking that occurs when people are processing and interpreting information in the world around them and affects the decisions and judgments that they make. Cognitive bias often works as rules of thumb that help you make sense of the world and reach decisions with relative speed. They may manifest themselves as feelings towards a person or a group based on their perceived group membership. More than 180 human biases have been defined and classified by psychologists, and each can affect individuals for whom we make decisions. These biases could seep into machine learning algorithms through developers unknowingly introducing them to the model or a training data set which includes those biases. Data completeness refers to “a structured and documented process performed to ensure that any database is complete for its intended use” and that all of the data needed is included and available. In addition, in healthcare, “data are considered complete if a patient record contains all desired types of data (i.e., breadth), contains a specified number or frequency of data points over time (i.e., density), or has sufficient information to predict an outcome of interest (i.e., predictive)”. However given the inequalities in access to healthcare for some underserved communities, data will often be incomplete. According to a 2020 study entitled, Ethics of Big Data and Artificial Intelligence in Medicine, “most data fed into AI tools tend to be homogeneous regarding patients’ characteristics. This may result in an under-representation or an over-representation of certain groups in the population”. For example, according to the COVID Racial Data Tracker, while Blacks accounted for over 15% of COVID deaths, they made up less than 10% of the population for clinical trial participants for both the Pfizer and Moderna vaccines. If the data available for AI is gathered primarily from a White population, the resulting AI systems will know less about other populations and therefore will not benefit Black patients or patients from other ethnic groups, per se. As noted in Ethics of Big Data and Artificial Intelligence in Medicine, “common practice is that minority populations are often under-represented, which makes them vulnerable to erroneous diagnosis or faulty treatment procedures as a result”. The Backdrop: Applying AI to clinical issues in healthcare is difficult. Healthcare data can be unstructured with data privacy and security issues further complicating data sharing. In addition, as we have seen during the COVID pandemic for a variety of reasons, underserved populations are underrepresented in training data sets and these data sets themselves contain elements of conscious and unconscious bias. As noted in Algorithms, Machines and Medicine in The Lancet “ training only on patients from one health service or region...runs the risk of overfitting to the training data, resulting in brittle degraded performance in other settings.” Data scientists and clinicians may approach data through a different lens. For example data scientists may seek to optimize models without considering the ability of clinicians to impact the variables they are trying to optimize. On the other hand, physicians often struggle with the balance between application of their clinical experience and trusting treatment protocols derived from technologically complex, often unexplainable AI tools. Along those lines, patients and clinicians want to understand the factors that went into data driven models, what factors these models consider, how these models arrive at their conclusions and how clinically valid treatment protocols derived from these models are. If nothing else, patients want to be assured that they will not be harmed in any way by following the advice of AI derived models. Implications: As we merge medicine and data sciences together, we must keep equity, transparency, explainability and trust in the forefront; these suggestions on eliminating biases in AI are crucial. AI and machine learning tools are products of the human mind and human beings inherently carry biases and by proxy their products/creations are prone to contain many of these same biases. As the novel pandemic exposed the existing disparities within the healthcare systems, efforts must be made to consciously assess models to ensure that they do not contain bias both conscious and unconscious going forward. First and foremost data scientists should ensure that data and data training sets collected for research and treatment must be heterogeneous enough to build deep learning algorithms that represent the diverse patient populations they are meant to serve. This will help ensure historically marginalized groups are treated fairly and accounted for in the algorithm development process to improve health outcomes. As outlined in Enhancing Trust in Artificial Intelligence: Audits and Explanations Can Help, “companies [should institute] a framework for responsible data use, particularly in the context of avoiding bias”. In addition, greater formal collaboration between physicians and data scientists is required to ensure that models are looking at the appropriate data and impacting treatment plans correctly. In fact, a number of programs including the Cleveland Clinic’s Center for Artificial Intelligence (CCAI) and Inception Labs at the Medical College of Wisconsin are pursuing interdisciplinary training and development to improve the application of AI initiatives in healthcare. Audits should also become a consistent and required part of the AI development process. As noted in a 2018 report from the Information Systems Audit & Control Association (ISACA), audits “should focus on the controls and governance structures that are in place and determine that they are operating effectively”. Audits should occur both pre-development and post-training/prior to implementation to guarantee that models do not have disparate impact, that they follow all existing laws and regulations as well as following all best practices. One approach may be to evaluate and map all such models for any potential disclosures of Protected Health Information (PHI). Data scientists and clinicians must take steps to ensure models are transparent and explainable to gain the trust of patients and clinicians. This must include explaining the factors that go into building models including demographic data, the nature and types of training data and parameters the models are trying to optimize. In addition, to the extent possible, developers of AI models in healthcare must be able to provide answers to patients’ questions surrounding data privacy and security including the availability and exchange of data. “Patients must have the right to decide: who will own their data, where that data will be stored, and what that data will be used for.” These suggestions coupled with incorporating evolving metrics for ‘fairness’ and equity are non-negotiable for improving overall health outcomes. Ultimately, by correctly combining the processing capability of artificial intelligence with the experience and insights gained from the human minds, healthcare systems can improve the quality of care, drive better patient outcomes and reduce burden on the healthcare system. Related Reading: Ethics of Big Data and Artificial Intelligence in Medicine Enhancing Trust in Artificial Intelligence: Audits and Explanations Can Help Auditing Artificial Intelligence Bias in AI: What it is, Types & Examples of Bias & Tools to fix it Tomorrow's Doctors Seek Training in Data Science, but Will That Be Enough?

  • Scouting Report-Caremerge:Improving Collaboration & Care in Sr Living w/Clinical Engagement Software

    The Driver: One of the many things demonstrated by the COVID pandemic was the need for improved care coordination, record keeping, and collaboration in the care of seniors. In addition, since caregivers and families were unable to visit patients due to the pandemic, seniors became socially isolated, taking a toll on their physical and emotional health. As a result of the devastating impact of COVID in senior care facilities, many have looked to examine their entire systems and models of care, looking to leverage technology to improve care and solve for workforce shortages post-pandemic. The Takeaways: Lack of communication between families and clinicians/senior care personnel often creates unwarranted friction and mistrust early on in the relationship. Interoperability in data sharing is key for healthcare, however, poor charting and high employee turnover rates are major obstacles in care delivery and diagnostics for seniors. A comprehensive EHR can seamlessly integrate quality and personalized care, facilitate care transparency, maintain compliance with regulations and reduce medical errors. Incoming senior residents are going to be more familiar with technology and there is an opportunity to invest in a technologically-capable approach when providing care for senior residents. The Story: Caremerge was founded in 2015 by Fahad Ahiz, who was originally seeking to create a “Facebook for seniors” but soon realized there was a broader need for communication and collaboration that included connecting senior care facilities and families/caregivers. Azix, now the company’s chief technology officer, soon realized there was a large, untapped market in leveraging technology to strengthen care coordination to improve the quality of life for senior residents and their families. Caremerge realized early on that applying technology could not only help free up caregiver’s time but also fosters patient satisfaction and by boosting communication of providers with patients and families. To date, the company has raised over $25M, most recently completing a Series D financing in July of 2019 raising an additional $5.2M from Echo Ventures, Ziegler and other undisclosed investors according to PitchBook. The Differentiator(s): Early on Caremerge realized they could leverage technology not just to improve communication and collaboration but to help improve care and reduce costs. By continuing to seek ways to apply digital tools to senior care, Caremerge has reported positive health outcomes and a decline in healthcare costs. Breaking down the overall communication scheme into three main parts has essentially allowed for a multi-faceted care coordination approach. Starting with pre-admission profile building, moving to involving the family and managing expectations and finally, synchronizing wellness and clinical efforts, the overarching care coordination system allows for innovative ways to monitor and improve the patient’s health. For example, Aziz noted that the company realized they could leverage artificial intelligence technology not only to improve communication but to analyze a patient’s condition. By “anticipating” such things as falls they could then apply AI to help avoid them. In addition, in senior care facilities recording keeping is still paper based, manual and difficult to share. In addition, Aziz noted that senior facilities often have high turnover rates and patients often have interactions with providers, outside facilities like hospitals, and physician groups. Consequently, Caremerge had looked to deploy EMR technology within senior care facilities to allow for more robust communication. An article in Electronic Health Reporter noted, “a centralized and digitized record of contacts invites everyone to the conversation about a resident’s health”, improving care and patient/family satisfaction. Their forward thinking has allowed for creative solutions like “Caremerge Voice”(with Amazon’s Alexa) and “Calendar Central”. These solutions improve overall communication and programming events between departments, patients and their families, and the care teams. The Big Picture: As demonstrated by the COVID pandemic, families and caregivers of residents in senior care facilities are an important component of the care team, often helping to advocate for patients and relieve stress on overburdened staff. In addition, social isolation is proven to have a detrimental impact on the physical and mental health of residents. Maintaining ties for seniors can be crucial for improving their care and well being. Tools like Caremerge, which help keep families and caregivers involved and informed, can simultaneously improve quality and lower costs for providers. In addition, Caremerge demonstrates how technology such as AI can be used to enhance care and allow for more human-based care delivery when providers are not tasked with mundane administrative duties. Caremerge helps healthcare providers improve accuracy in data collecting, develop a better longitudinal care record and ensure better care delivery and diagnostics. However, current EHR and electronic Medication Administration Record technology (which automatically documents the administration of medication into certified EHRs) are lacking. The industry also suffers from poor handoffs of patients between facilities and providers, improper data recording (due to variations in training), and incomplete health records which can often lead to or contribute to poor health outcomes. Integrating families into the patient’s care plan, improved documentation and enhanced interoperability through Caremerge can enhance a patient's health outcomes and wellbeing. Technology with the Human Touch EHR Integration Is Key To Running a Five-Star Senior Healthcare Facility

  • Telehealth Revolution Could Increase Malpractice Risk-The HSB Blog 5/10/21

    Our Take: The COVID-19 pandemic has increased the use of telehealth and medical technology as federal restrictions were loosened and waivers were put into place. Although telehealth is used more frequently to treat acute conditions, physicians need to be wary of the potential for malpractice issues in the future. There are outstanding concerns around whether providers are aware of particular guidelines to ensure the standard of care has been met. Post pandemic, waivers will be lifted, in-person medicine will likely return closer to pre-pandemic levels and limits could be placed on practice guidelines posing a risk to providers practices. Key takeaways: ● The Federal Government’s decision to expand services covered by telehealth included removing licensing restrictions and extending coverage to Medicare patients. ● The retightening of telehealth regulations could result in providers being held liable for breaching the standard of care if patients are harmed during telehealth visits if providers don’t remain on top of regulatory changes. ● Telehealth significantly reduced the barriers to telehealth utilization but placed significant concerns on how providers can practice safely and within their jurisdiction in the future. ● In response to concerns providers face, there are at least four preventive steps providers can take to avoid malpractice claims. The Problem: As telehealth use increases with the greater acceptance by patients and providers for care following the pandemic, and the increasing potential to use it for higher acuity cases there are concerns about the potential for higher incidence of telehealth malpractice claims. In particular, two areas of concern center around providers’ ability to adhere to data privacy and security regulations and the potential for misdiagnosed conditions. While state and Federal regulators waived a number of regulations around data privacy and security during COVID, once the public health emergency ends, there are questions about whether providers will be able to ensure full adherence to federal privacy and security rules. Given the increased number of platforms and methodologies by which patients participated in telehealth during the pandemic (including non-HIPAA compliant textng and video-chat) more opportunities will present themselves for intentional and non-intentional violations of the Health Insurance Portability and Accountability Act (HIPAA) and the California Consumer Privacy Act (CCPA). With regard to misdiagnosis, while the pandemic moved patients towards greater use of telehealth, some remain skeptical that telehealth can effectively diagnose and treat patients particularly as it moves to treat higher-acuity conditions. For example, misdiagnosis may occur due to ineffective communication, an inability to establish a robust physician-patient relationship, or providers being unable to get a complete and detailed patient history. In addition, given the lack of an in-person physical examination there is also the potential that providers may miss non-verbal clues more easily picked up in a physical examination. The Backdrop: Many years prior to the pandemic, in 2005, The Public Readiness and Emergency Preparedness Act (PREP Act) authorized the Secretary of the Department of Health and Human Services (HHS) to make certain emergency declarations providing immunity from liability to aid in addressing a public health emergency (PHE). In January 2020, President Trump declared a PHE allowing the HHS to institute certain emergency measures. Following the declaration Federal and state regulators eliminated or suspended barriers to implementing digital health, resulting in dramatically increased usage. According to a study by the American Medical Association (AMA), the Federal Government’s decision to ease provider privacy requirements, expand services coverable by telehealth, remove licensing fees restrictions, and extend telehealth coverage to all Medicare via the increase in covered services significantly reduced the barriers to telehealth utilization. Among some of the policy changes implemented were: 1) allowing physicians to provide telehealth services to out-of-state Medicare beneficiaries, 2) relaxing strict enforcement of fines for non-compliance with HIPAA rules, 3) paying providers the same rate for telehealth services as in-person visits for Medicare patients, and 4) $200 million in increased funding from the Federal Communications Commission (FCC) under the CARES Act to support eligible health care providers in obtaining the necessary devices to facilitate the provision of telehealth services. Despite this loosening of regulations during the pandemic, a recent article in Becker’s Hospital Review pointed out that there are a number of potential medical malpractice concerns providers should be aware of when delivering telehealth services. The article, which cited the Wolfe Pincavage law, noted that telehealth malpractice concerns center around five areas including: 1) data breaches of patient’s protected health information, 2) misdiagnosis or possible improper prescription of patient’s medications 3) software limitations and/or internet glitches that may lead to diagnostic errors, 4) accurate documentation by providers which ensures patient confidentiality and standards of care are met, and 5) providers being significantly well versed in their respective states telemedicine laws to ensure they are meeting all of the specific requirements of state law. Telehealth delivery exacerbates the concerns providers may face, which can hold them liable for breaching the standard of care if patients are harmed as a result of incomplete or inadequate care during telehealth visits. Implications: The COVID-19 pandemic completely changed the outlook on telehealth services and how care is delivered. While traditional approaches to seeking medical advice were effective, telehealth provided added convenience and flexibility, particularly for people who were afraid of exposing themselves to the Coronavirus during the pandemic and did not want to visit medical facilities, like hospitals. In addition, telemedicine can broaden healthcare access by allowing patients in remote areas to access care where care options may be limited. Nevertheless, telemedicine poses its own unique set of risks and challenges compared to the in-person practice of medicine. For example, due to state and Federal laws there are unique requirements regarding jurisdiction, procedure, and duty of care. In addition, given that numerous legislative and regulatory changes are expected as the waivers during the PHE end, providers and clinicians must ensure they remain diligent in following rule changes to ensure their practice does not exceed the scope of their medical licenses as telemedicine often crosses state lines. Also, while telehealth usage has declined sharply from the peaks seen during COVID, overall utilization levels are expected to remain higher than pre-pandemic levels as is the level of acuity of conditions treated via telemedicine. As a result, the potential for malpractice issues is likely to be greater in the future. As noted in a recent article entitled “Is the Doctor In? Medical Malpractice Issues in the Age of Telemedicine” providers can take four steps to help avoid malpractice: 1) be vigilant and ensure effective telehealth visits, 2) be more cautious with consent and proper documentation prior to the telehealth visit, 3) ensure the technology used for telehealth visit comply with HIPAA, HITECH and state regulations and providers abide by all in-person medical practice standards, medical licensing boards, and 4) seek advice from their legal departments to better understand potential liabilities as there may be certain medical malpractice risks towards telehealth as compared to in-person care. As telemedicine becomes a more consistent part of the mutli-channel care delivery model, providers will want to ensure successful telehealth encounters as demand increases. Similarly, they will want to ensure strict adherence to state regulatory mandates, including regular checks with counsel and routine audits to reduce the risk of licensure violations and malpractice liability. The successful adoption and usage of telehealth and adherence to the prevailing regulatory standards will ensure their practices remain on the cutting edge of healthcare delivery in order to increase the role of preventive care, lower hospitalization rates and decrease healthcare costs. Related Reading: 6 Things to Know About Telehealth Medical Malpractice Concerns Uptick in Telehealth Reveals Medical Malpractice Concerns Is the Doctor In? Medical Malpractice Issues in the Age of Telemedicine CARES Act: AMA COVID-19 Pandemic Telehealth Fact Sheet

  • Scouting Report-Adyn: Optimizing Women's Health Through Personalized Birth Control

    The Driver: Adyn, a Seattle startup, raised a $2.5 million seed round co-led by Lux Capital and M13. Adyn plans to use the funds to launch its birth control optimization test later this year. It has already sparked demand and has a waiting list for users. The Takeaways: Adyn’s at-home kit measures hormone baseline levels and assesses genetic risk for two of the most serious birth control side-effects: depression & blood clots Women’s health is often understudied, resulting in medically unexplained symptoms according to a report in Cogent Psychology. Women are more commonly misdiagnosed than men due to the medical research gap per the Association of Health Care Journalists. The Story: Adyn’s co-founder, Dr. Elizabeth Russo came up with the idea when she encountered side-effects of changing her birth control medication and “was thrown into suicidal ideation”. Given her background as a Ph.D. in genetics and genomics, Ruzzo was able to recognize this was due to the change in medication. However, as a result of the experience, she became dedicated to defining how gender gaps in research can lead to differences in disease and drug response particularly with birth control medications. For example, the company notes that over 50% of women try four or more birth control medications before finding one that works for them. Following her experience, Ruzzo launched a platform to address health disparities in women’s health while improving health literacy for her clients. Adyn’s mission is to close the medical research gap in women’s reproductive health. The Differentiator(s): While there are platforms that offer birth control without a doctor’s prescription, Adyn is attempting to change healthcare diagnostics and delivery through its telemedicine platform by using precision medicine to better match patients with accurate birth control prescriptions that attempts to minimize side effects. For example, while there are over 200 birth control contraceptives on the market they are generally prescribed for specific patients without any kind genomic testing for side effects, etc. (not to be confused with side effects and efficacy testing during the approval process) . Since the 1960s, birth control users have generally gone through a process of trial and error with multiple birth control prescriptions before finding one that works for them. For example, according to an article in Business Insider the “average time spent on contraceptive counseling is 12.9 minutes” and both patients and providers have become accustomed to this unscientific method when it comes to finding the best birth control. Due to gender and racial gaps in medical research, the pill selection process remains shrouded in mystery and frustration resulting in a broad range of reported side effects. These can range from weight gain to blood clots to depression when the patient and provider’s actual goal would be to have birth control be side effect free. Adyn’s telemedicine platform is equipped with specialized birth control specialists who aid in the pill selection process after testing and reviewing a patient's history. Adyn’s optimized at-home test collects information about an individual’s hormone level (through multiple readings) and genetic risk (via a single reading). These results are then explained to the patient, providing them access to their own biological data to help them make the decision in a comprehensive manner. Adyn is aiming to improve both the diagnostic approach and delivery of birth control contraceptives, and Adyn expects to offer reproductive healthcare recommendations (family planning, fertility, birth control) through their trained specialists. The Big Picture: For the past 30 years, women have generally been using an opaque process when choosing their birth control and certainly not one as scientific as many would expect given the wide range and severity of potential side effects. By closely monitoring and pairing birth control users with contraceptives that have minimal side effects, women's daily life and reproductive health should be improved. Through feedback and surveys with their patients, Adyn will also have the opportunity to investigate other reproductive problems such as polycystic ovary syndrome (PCOS) is a hormonal disorder common among women of reproductive age than can cause infrequent or prolonged menstrual as well as other menstrual irregularities. Lastly, by rejecting the outdated ‘trial and error’ method for birth control selection, Adyn can help demonstrate the quality and effectiveness benefits of personalized medicine and genomics on a broad scale which is likely to shape healthcare delivery well into the future. Precision Medicine Company Adyn Raises $2.5M Seed Funding for Personalized Birth Control