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Trending in Telehealth: December 14, 2023 – December 20, 2023

Trending in Telehealth highlights state legislative and regulatory developments that impact the healthcare providers, telehealth and digital health companies, pharmacists and technology companies that deliver and facilitate the delivery of virtual care.

Trending in the past week:

  • Telehealth pilot programs
  • Standards of practice

A CLOSER LOOK
Finalized Legislation & Rulemaking

  • Effective February 1, 2024, the Wisconsin Hearing and Speech Examining Board clarified, by final rule, the standard of care for hearing instrument specialists and audiologists. The final rule defines telehealth; expands the scope of unprofessional conduct; and requires licensure for a person engaged in the practice of selling or fitting hearing aids to a patient located in the state, whether in-person or via telehealth.

Legislation & Rulemaking Activity in Proposal Phase
Highlights:

  • New Jersey continues to progress Assembly Bill 5311. If enacted, the bill will enter New Jersey into the Counseling Compact.
  • Wisconsin progressed AB 573 and AB 541. AB 573 directs the Department of Health Services to establish a pilot program to implement virtual behavioral health crisis care services for use by county or municipal law enforcement agencies in the field. The service will connect law enforcement officers who encounter persons in crisis to behavioral healthcare services. AB 541 provides that no mental health care provider may be required to be licensed, registered, certified or otherwise approved to practice in Wisconsin to provide mental health services by telehealth to patients located in Wisconsin if the mental health care provider satisfies certain conditions, including:
    • the mental health care provider is licensed, registered, certified or otherwise approved to practice in the state in which the provider is physically present when providing telehealth services;
    • the mental health care provider may provide telehealth services in Wisconsin within the scope of his or her license, registration, certification or approval from the state from which the mental health care provider is providing telehealth services; and
    • the mental health care provider informs the patient whether the provider is licensed in Wisconsin, what state he or she is providing telehealth services from, what states in which he or she is licensed, registered, certified or otherwise approved to practice, and which regulatory boards the patient may contact to file a complaint.
  • The Texas State Board of Dental Examiners issued a proposed rule that would amend 22 Tex. Admin. Code § 111.5 related to electronic prescribing waivers. The proposed amendment removes the requirement that a dentist must submit a written statement and supporting documentation describing the circumstances necessitating a waiver, and instead requires a dentist to attest to the circumstances necessitating a waiver. The board indicates that the amendment will make it less burdensome on the dentist when submitting a waiver request to the board and it will make the Board’s waiver process more efficient. The comment deadline is January 14, 2024.

Why it matters:




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Key Takeaways | What the Money Thinks: Investing in Innovative Care Delivery

During this session, digital health investors and finance experts discussed the trends they are watching in today’s market. The group also shared ideas on how companies can stand out from their competitors in the bid for limited investor dollars, and the role of venture capital and venture capital-backed companies in solving today’s healthcare challenges.

Session panelists:

  • Bill Evans, Founder and General Partner, Rock Health
  • Anna Fagin, Principal, Town Hall Ventures
  • Adam Heller, Managing Director, Healthcare Investment Banking, Ziegler Healthcare Investment Banking
  • Fazeela Abdul Rashid, Partner, Revolution Growth
  • Moderator: Dale Van Demark, Partner, McDermott Will & Emery

Top takeaways included:

  1. The COVID-19 pandemic accelerated the adoption of digital health, and while digital healthcare delivery is here to stay, some correction in the market is expected. While the healthcare system was moving towards digital health due to technological advances, the COVID-19 pandemic accelerated patients’ and providers’ wiliness to utilize technology. This increased utilization has provided tangible evidence that digital health solutions have real efficacy, clinical quality, and can help lower costs and bring better, more efficient outcomes. At the same time, the COVID-19 pandemic distorted the market, as providers had no choice but to supply care virtually, and there was abundant capital for startups. As the pandemic unwinds and the market tightens, the panelists expect to see correction in the market.
  2. In this constrained capital market, successful digital health companies are those that can demonstrate they are self-sustaining, able to be a long-term solution and can add value. Investment funds have been funneled towards operating and managing portfolio companies, with fewer new investments as a result. With this in mind, new entrepreneurs in the digital health ecosystem need to demonstrate that they can make a core, clear difference, adding true efficiency to the healthcare system and demonstrating where their value resides.
  3. Digital health tools can address inequities in the health care system—but not every solution addressing inequity is venture-backable. There is a tremendous opportunity for digital health tools to address inequity if founders and investors are willing to ask hard questions and commit to addressing inequity as part of their goals. Returns can be equipped by mission, rather than acting in conflict with the mission. However, not every business that can affect outcomes is designed for scale and is venture-backable. The panelists agreed that it is okay that not everything is venture-backable—there are many ways to fund a business and many issues in the healthcare system that require different stakeholders.
  4. For ventures that are looking for capital right now, focus on finding the right partners and demonstrating value. The panelists recognized that it is a difficult time for ventures that are looking for funding, but urged companies not to give up if they have something unique and visionary. Even in this market, the panelists agreed that finding the right partner is key—the relationship must work in both directions and align with the venture’s vision. The panelists also advised that successful ventures that will be those that can achieve early, [...]

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Key Takeaways | Hospital and Health System Digital Health Spotlight: It’s all About the Patient!

During this session, leaders from health systems and digital health technology companies explored how they are leveraging their prowess to develop cutting-edge strategies to deliver accessible, easy to use and secure digital health solutions that work together seamlessly across the healthcare ecosystem and patient journey.

Session panelists:

  • Erica Davila, general counsel, Transcarent
  • Daniel Gottlieb, partner, McDermott Will & Emery
  • Nathan Leong, vice president, legal, Memora Health
  • Sudipto Srivastava, vice president, digital transformation, Hospital for Special Surgery
  • Paul Uhrig, senior vice president, chief legal officer and digital health officer, Basset Healthcare Network
  • Moderator: Bernadette Broccolo, partner, McDermott Will & Emery

Top takeaways included:

  • The patient relationship is the cornerstone of any patient engagement strategy. Most, if not all, of the panelists agreed with this statement, yet they also recognize that the consumer and patient engagement solutions flooding the digital health ecosystem have cast doubt as to where the primary patient relationship should reside. For health systems, there is no doubt—they are and must remain a central, trusted partner for delivery and coordination of care across a patient’s healthcare journey. In their quest to do so, health systems are aggressively pursuing strategies that combine digital and in person touchpoints to engage individuals, both as consumers and as patients, “where they are” so they can get them to the right healthcare, at the right place and at the right time. While many digital health technology solution companies pursued “direct-to-patient” offerings early on, some quickly recognized the complexities of that model and shifted their primary focus to becoming an “extension” of health systems and payors by providing the turnkey technology infrastructure and support services they need to remain the “front door” for healthcare for patients and consumers.
  • Patients, providers and self-funded health plans want a seamless, integrated and holistic digital engagement experience. Digital engagement solutions and the data strategies supporting them have been highly fragmented and lacking integration across the patient journey and healthcare ecosystem. This is due largely to their multiple points of entry into disconnected “point-to-point solutions,” which is particularly challenging for poly-chronic patients. Providers and their patients, and self funded health plans and their members, are frustrated and clamoring for single sign on platforms through which they can engage seamlessly, in a single encounter, with digital health applications and data sources. Health systems, in particular, are looking to “fill the white space” in functionality existing between inflexible electronic health record (EHR) systems that rely exclusively on traditional patient identifiers and less formal point to point digital health solutions. Individual providers want solutions that will alleviate the burden and stress of today’s technology tools. And everyone wants an approach that brings a holistic rather than an episodic experience.
  • It will “take a village” to achieve seamless, integrated and holistic digital health engagement. No single stakeholder in the digital health ecosystem has the solution for overcoming the frustrating fragmentation of digital health engagement solutions. There certainly is no “one-size-fits-all” approach. Health systems, payors and digital health turnkey solution providers are [...]

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Key Takeaways | Playing the Long Game: Investor Outlook on Late-Stage Funding

During this session, panelists discussed what strategic and late-stage investors are looking for in today’s market, offered practical tips on how to make organizations attractive to investors, and described innovative funding arrangements for use during tough times.

Session panelists:

  • Julie Ebert, Managing Director, Silicon Valley Bank
  • Adam Kaye, Managing Director, Sixth Street
  • Noah Lewis, Managing Partner, Ardan Equity
  • Irem Rami, Principal, Norwest Venture Partners
  • Moderator: Thaddeus E. Chase, Jr., Partner, McDermott Will & Emery

Top takeaways included:

  1. The days of funding growth at all costs are over, particularly for late-stage businesses. Investors are looking for strong unit economics at the gross-margin level, proven return on investment, customer retention and product-market fit.
  2. Consolidation and other M&A activities may be the best plays for late-stage companies in this market. Investors are skeptical of soaring valuations and customers have been overwhelmed with point solutions over the last few years. Strategic and other late-stage investors are focused on consolidation opportunities.
  3. Companies should build for profitability, not for exit opportunities. For example, instead of launching with a national sales strategy, companies should focus on proving return on investment (ROI) in one or two markets before expanding, noting, “Slow is smooth, and smooth is fast.”
  4. Although investment activity has been slower over the past year, investments are expected to pick up again during the next 12 to 24 months. The panelists were most bullish on life sciences, followed by payor solutions, then provider solutions.



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Key Takeaways | Innovative Partnerships in Action: Fireside Chat with Covera Health and Nuance Communications

During this session, leaders from Covera Health and Nuance Communications provided insights into their companies’ collaboration to improve patient outcomes and operational efficiency through innovative technology solutions. The panelists also shared their perspectives on what makes for a successful collaboration in digital health. The discussion shed light on broader trends surrounding novel strategic partnerships between digital health companies that are changing healthcare delivery and accelerating value-based care.

Session panelists:

  • Jacques Gilbert, Vice President, Healthcare Strategy, Partnerships and M&A, Nuance Communications
  • Ron Vianu, Founder and Chief Executive Officer, Covera Health
  • Moderator: Jiayan Chen, Partner, McDermott Will & Emer

Top takeaways included:

  1. Covera and Nuance decided to partner because they were aligned on solving the same problem: longstanding challenges in driving quality in radiology care and aligning incentives among payor and provider stakeholders. The collaboration made particular sense because each company has a unique lens and business model in the space, with Covera building offerings for payors and Nuance interfacing with radiology providers. Both companies are also highly technologically driven, committed to advancing healthcare quality through artificial intelligence (AI) and deriving insights through data.
  2. While “collaboration” and “partnership” are used quite liberally in the digital health context, Covera and Nuance have a truly integrated partnership that requires alignment, shared vision, tenacity and a willingness to overcome challenges. This is not a vendor/provider relationship or merely a cross-selling or cross-promotion arrangement. Each party brings a unique set of tools, strengths and relationships to the table, whether it is dexterity in the managed care space or a wide network of integrated technology and data platforms used by providers. Overcoming challenges in this kind of partnership requires the teams—at even the highest levels—to align around a common goal and a belief that they can accomplish the goal. When they run into areas of conflict, that fundamental alignment allows them to move forward and find solutions.
  3. Some of the biggest barriers for technology-driven partnerships can come from each team’s desire to build and own the technology. Overcoming these barriers requires constant focus on the collective goals of the partnership and for each party to engage in ongoing internal reflection and calibration.
  4. There can be particular challenges when one party is a startup and the other is an established, larger company. For a startup, it can be difficult to scale the company while simultaneously collaborating with a much larger company that, for its part, must manage more extensive and varied strategic goals. In turn, larger companies often must be sensitive to the fact that a startup partner can be built to move quickly and is positioning itself for growth and potential future acquisition. To better navigate these differences, the larger company could consider carving innovation opportunities out of its core business and staffing it with people who understand how startups operate.
  5. There’s an increasing recognition that the path to success is through partnerships. For companies looking to enter partnerships, understanding each party’s incentives is crucial. This concept goes beyond the partnering companies and includes [...]

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Top Takeaways | 2023 Digital Health Forum | Innovative Partnerships in Action: Fireside Chat with Best Buy and Atrium Health, a part of Advocate Health

In this lively and practical conversation, panelists elaborated on the recently announced partnership between Atrium Health, a part of Advocate Health (Atrium), and Best Buy Health. The partnership is designed to leverage technology, empathy and expertise to deliver high-quality care in the home following patients’ transition to a hospital-at-home program.

Session panelists included:

  • Deborah Di Sanzo, President, Best Buy Health
  • Rasu Shrestha, MD, MBA, Executive Vice President, Chief Innovation and Commercialization Officer, Advocate Health
  • Moderator: Stephen Bernstein, Partner-In-Charge of Healthcare Practice Operations, McDermott Will & Emery

Top takeaways included:

  • Partnership focus. Atrium, one of the largest academic medical systems in the United States, partnered with Best Buy Health to improve care delivery in the home. The partnership is aimed at creating smoother paths for care, shifting from episodic brick and mortar treatment to care in the home.
  • Trust and diligence. The partnership between Atrium Health and Best Buy Health was the culmination of two years of discussions. Trust, communication with common purposes and measurable outcome goals were identified as crucial factors in establishing successful partnerships in healthcare.
  • Offering and collaboration. The partnership aims to combine Best Buy’s technological expertise, including the remote patient monitoring (RPM) platform from Current Health, with Atrium’s cutting-edge clinical protocols and hospital-at-home (H@H) program. The collaboration focuses on improving the patient care experience and automating processes to identify and enroll suitable candidates for H@H programs.
  • Geek Squad involvement. Best Buy’s Geek Squad plays a role in ensuring the functionality of devices used in home care. Geek Squad’s responsibilities in the partnership parallel its traditional role with Best Buy and include setting up and maintaining the devices when patients are discharged from the hospital and offering customer service and troubleshooting tips.
  • Impact and growth. The partnership also addresses capacity issues and drives the growth and expansion of H@H programs. By treating patients at home, the program is seeing signs of successfully freeing up intensive-care unit (ICU) and operating-room resources while still monitoring and treating patients effectively. The collaboration between social workers and nurses in home care, combined with the technological expertise of Geek Squad, is beginning to provide evidence of improved quality of care and patient outcomes, with services being delivered in this manner to some of the most ill patients with multiple chronic conditions.
  • Best Buy and Advocate/Atrium are continuing to monitor progress of this joint effort.



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Key Takeaways | CEO and Founder Perspective: Provider Spotlight

During this session, CEOs and founders of transformative digital-health companies shared their experiences and offered thoughts on today’s market and where care delivery is heading next.

Session panelists:

  • Priyanka Jain, Chief Executive Officer and Co-Founder, Evvy
  • Naveen Kathuria, Chief Executive Officer, GoCheck Kids
  • Kristina Saffran, Chief Executive Officer and Co-Founder, Equip
  • Moderator: Marshall E. Jackson, Jr., Partner, McDermott Will & Emery

Top takeaways included:

  1. Virtual-care platforms and digital-health technologies continue to reduce barriers by bringing care directly into the home and expanding access to culturally competent care.
  2. Digital-health tools help increase provider access to data and inform patients about new research findings and other relevant developments they may wish to raise with providers during care visits.
  3. Advances in women’s health continue to lag, but digital-health providers are closing the gap by using enhanced data collection and analysis to develop new care pathways designed specifically for women.
  4. Patient and provider education is critical to the successful adoption and use of digital-health tools. However, choice of technology impacts adoption and continued use of digital-health platforms. For example, the leveraging of smartphones that providers and patients are already accustomed to using may yield greater results, as compared to the use of unique or custom devices that require training to use correctly.
  5. Market focus is shifting from access to quality. As economic conditions change, digital-health platforms that seek new funding will face pressure to prove that their offerings not only increase access, but actually improve outcomes.



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In Case You Missed It: Highlights | When Digital and Life Sciences Intersect

In this session, panelists discussed common pitfalls that life sciences companies face as they explore ways to incorporate digital-health strategies into product and service offerings, as well as approaches for successful integration and launch. Seasoned veterans in developing and deploying digital-health solutions from within the life sciences ecosystem, the panelists shared lessons learned and offered practical suggestions for listeners addressing similar projects.

Session panelists:

  • David S. Klimstra, MD, Founder and Chief Medical Officer, Paige.AI, Inc.
  • Suhas Krishna, Vice President, Head of Product Management, Digital Health, Bristol Myers Squibb
  • Betsy McSheffrey, Head Counsel, Data, Technology and Innovation, Takeda
  • John Rootenberg, MD, Principal Director, Digital Safety and Decision Support, Genentech (Roche)
  • Ryan Sysko, Chief Executive Officer, Amalgam RX
  • Moderator: Jennifer Geetter, Partner, McDermott Will & Emery

Top takeaways included:

Challenges

  1. Last-mile conundrum. Panelists observed that for typical products manufactured by life sciences companies, a disproportionate amount of the hard work occurs prior to regulatory approval. Once the product is approved (by, for example, the Clinical Laboratory Improvement Amendments (CLIA) or the US Food & Drug Administration (FDA), the company’s most difficult work is done. For digital-health solutions, the inverse is often true. Even sophisticated digital-health products and services typically have a shorter development timeline, but once released in the market, challenges around adoption, adherence, persistence and integration must be addressed. In addition, customers will expect regular software updates. Life sciences companies are not always adequately prepared for this reverse last mile—i.e., the longest mile—of the development and marketing lifecycle.
  2. Risk appetite. Panelists noted that the life sciences industry is typically risk averse. This is in sharp contrast, for example, to the software industry, which is attuned to software innovations and is designed to anticipate missteps and optimize, when necessary, the “fast fail.”
  3. Blurry strategic vision. The panelists discussed “digital-health FOMO” (fear of missing out). Life sciences companies want to offer digital-health products and services because they recognize the strategic value of participating in the market explosion at the intersection of healthcare and data/computing. Sometimes this enthusiasm outpaces the speed with which life sciences companies can develop dedicated digital-health strategies, either as companions to existing products or as complimentary clinical services. Having a clear strategic objective governing the development of a product and realistic investment goals are critical.
  4. Deployment. The panelists emphasized that once a digital health tool is developed, companies should ensure physicians and patients actually adopt and continue to use the tool. Specifically, one panelist stated, “The one who wins is the one who has the right deployment [of the tool].”

Opportunities

  1. Hidden value. Digital-health strategies, such as using the data obtained from digital-health tools to promote research, offer hidden value for life science companies. As a component of development and marketing strategy, life sciences companies need to be prepared to articulate these benefits, especially those that may not be readily apparent or may be ancillary benefits. The successful deployment of a digital-health tool—for example, a patient- or consumer-facing app—is predicated on the persistent adoption of [...]

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Top Takeaways | 2023 Digital Health Forum | Behavioral Health 2.0: Post-Pandemic Priorities

In this session, the panel discussed the opportunities digital health offers currently for behavioral-health care, and what might be around the corner.

Session panelists included:

  • Robert Hasty, General Counsel, Pelago (formerly Quit Genius)
  • Tiffany Lin, Co-Founder and Chief Executive Officer, Daylight Health
  • William Robinson, Head of Policy and Strategy, Big Health
  • Moderator: James A. Cannatti III, Partner, McDermott Will & Emery

Top takeaways included:

  • Accessing quality care. Digital health—including the technology itself and the care models based on it—has become a valuable addition to the healthcare ecosystem, offering increased access to critical behavioral-health care through, for example, 24/7 chat services, that otherwise may be out of reach for patients, especially for those in rural and marginalized communities. It also has played a significant role in destigmatizing behavioral health by breaking down barriers to treatment and providing platforms for individuals to seek support in convenient settings.
  • Filling the gap. The shortage of clinicians has contributed to a tangible absence of specialty behavioral health providers. One example, pediatric psychiatry, continues to have a high demand but, unfortunately, many patients are met with a low supply of clinicians. Digital health helps fill an important gap in providing access to behavioral-health care.
  • Hybrid treatment options. Implementing a hybrid treatment model that incorporates digital and in-person touchpoints can optimize scalability in digital healthcare. A hub-and-spoke model, in which digital tools are embedded within existing systems, offers a balance between prioritizing patients’ needs to receive care in a comfortable setting and the importance of assessing and referring individuals with more serious conditions to appropriate outpatient or inpatient programs.
  • Across the pond. In markets such as the United Kingdom, the National Health Service (NHS) has actively explored and adopted digital-health solutions to enhance patient care and streamline healthcare delivery. In many cases, patients have access to digital-first mental health services at no cost to them. Lessons learned from the UK and other markets may help shape future approaches to digital behavioral health in the United States.
  • Reimbursement landscape. Coverage and reimbursement often lags behind the science. This is particularly true regarding digital behavioral health. Finding market strategies that allow for patients to access care is critical. Expect to see continued leveraging of business-to-business (B2B) models and value-based care arrangements as new opportunities and approaches are also explored.



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Key Takeaways | Regulatory Roadblocks and Opportunities: How to Thrive in a Shifting Healthcare Landscape

During this session, panelists offered insights into the regulatory action, rulemaking and legislation shaping the future of digital health, with a particular focus on artificial intelligence (AI), data privacy and the end of the COVID-19 public health emergency (PHE).

Session panelists:

  • Lucia Savage, Chief Privacy and Regulatory Officer, Omada Health, Inc.
  • Latoya S. Thomas, Head of Policy and Government Affairs, Included Health
  • Kate Tipping, Deputy Director, Regulatory and Policy Affairs Division Office of the National Coordinator for Health Information Technology (ONC)
  • Moderators:
    • Kristen O’Brien, Vice President, McDermott+Consulting
    • Rachel Stauffer, Senior Director, McDermott+Consulting

Top takeaways included:

  1. As the landscape changes, multiple regulatory entities continue to look closely at digital health, especially telemedicine and AI. Agencies are contemplating how to regulate effectively while focusing on the advancement of health equity and social determinants of health.
  2. ONC is proposing additional transparency requirements for AI in Certified Health IT through its recently proposed rule Health Data, Technology, and Interoperability: Certification Program Updates, Algorithm Transparency, and Information Sharing (HTI-1). Through these new proposed transparency requirements, ONC is focused on promoting trust and increasing adoption by providers of AI tools embedded within Certified Health IT products. However, given that certain uses of AI in healthcare are already regulated by the US Food & Drug Administration, these new proposals may add additional regulatory layers to AI outside of current authorities.
  3. The end of PHE flexibilities is causing frustration and increased costs of compliance among digital-health providers. For example, the expiration of eased restrictions regarding the cross-border practice of medicine and other scope-of-practice limitations is requiring digital-health platforms to confirm that providers are appropriately licensed in applicable states and that care teams comprise providers practicing within the scope of their license.
  4. Industry stakeholders would like to see the US Centers for Medicare and Medicaid Services (CMS) take action on reimbursement for asynchronous telehealth services, primarily because the historical paradigm of reimbursing for synchronous telehealth services provided by a distant site to an originating site no longer reflects effective telehealth modalities in use today.



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