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Impressions from JPM Healthcare week

Okay, so, like many of us, I visited San Francisco during the JP Morgan Healthcare gathering.  I attended a networking (cocktail) event each night, met people for coffee (lots of coffee!) and attended sessions at the EY event – many thanks to my friends for invitations and Ernst and Young for the opportunity to attend their programs.  Here is what I heard being discussed over the visit.

Healthcare continues to attract new funds to the sector, driving valuations higher, to the frustration of investors who have been in the sector for years.  There is still a perception that healthcare is poised for all manner of disruption, restructuring and digital innovation.  “Digital” seems to be the newest cool buzz word.   There is a lot of interest in post-acute care service providers.  Pressure on hospitals resulting from advances in treatment, emergence of specialty and alternative care delivery sites, focus on “pay for performance”, revenue challenges and shifts to lower cost venues all are playing a role in making acute care tough (contrarian opportunity?).  Home Health, hospice, rehab, long term care, preventive care were all topics of great interest this year.  Innovation and investment in these services is long overdue.  The opportunities for additional capacity, improved quality, safety, access, transparency and convenience are huge.  The pressures on acute care driving patient care elsewhere are likely to provide sustained growth in these “downstream” services.

Interest and excitement in Machine Learning and Artificial Intelligence opportunities persists.  IBM Watson has been joined by other platforms.  While these products and services struggle to gain traction in regular medical practice, there continues to be excitement and enthusiasm for the opportunities they present.  In particular, application to imaging analysis, and administrative functions (supply chain, revenue cycle, logistics/scheduling) is gaining momentum.

Excitement about wearable medical monitoring applications and the Internet of Medical Things seemed less obvious this year.  These technologies offer value to post-acute service delivery, chronic disease management and recovery support.  There was buzz of course, just not as loud as might be expected for technologies that are still emerging into practical application.

Precision medicine is a topic that seems to be building a following.  A lot of progress with cancer, genomics, and medication guidance all illustrate the potential to make medical care safer, successful and less expensive.

I appreciate Jonathan Bush’s observation (paraphrasing) that “healthcare is the one industry in which someone can declare the same direction ten years in a row and still be a luminary”.  That said, I see several initiatives slowly coming together (continental drift?) to enable exciting synergies to emerge.  What are they?  Meaningful Use Stage Two made patient charts electronic (only partially digital), our largest healthcare systems are growing comprehensive clinical chart repositories internally that offer disease/condition analysis opportunities for sound diagnostic algorithms and precision treatment discovery.  Natural Language Processing can read and interpret medical notes and orders (EMRs did solve the handwriting problem!) to close the “electronic chart” to “digital chart” divide.  Big Data technologies can handle storage, retrieval and manipulation of growing patient case records.   Patient image studies can be combined with the rest of the chart to “learn” diagnostic algorithms from “completed” medical cases, improving consistency and accuracy of evaluation.  Genetic data can be created and added to patient records, supporting discovery of physiologic connections between medical conditions, health risks, medication selection and heredity.

Big Data and AI/machine learning may finally combine to deliver effective new tools, treatments, and services that create significant value for patients and investors.

I did not hear as much this year about consumer enabling technologies, apps and services.  This was a really active, hot area of interest last year.  Price and quality transparency intended to enable patients to make informed decisions (and move volume to those providers who use them and compare favorably) were a big deal last year.  Apps enabling access convenience, personal health data tracking and record management and e-visits with doctor suppliers were in abundance.  These tools are still around, but the excitement of a class of innovation expected to experience rapid uplift and meaningful healthcare system disruption on the scale of an Uber or Lyft has cooled.  As one CEO commented, consumerism as a strong market force in healthcare is still a few years (or more) away.  Sadly, many citizens continue to take health for granted until a condition or event is encountered, making it a priority.

Telemedicine may finally be poised to take off.  Pressures on non-urban, sole community hospitals to reduce services, close or be acquired may finally drive emergence of broader service offerings, getting away from specialty specific offerings that have dominated this space for years.  40% of Americans live and work in small, often remote communities.  Preserving local access will become a practical and competitive necessity for providers and payers alike.

Thanks again to everyone that I chatted with, shared coffee with, hosted networking events and to EY for access to their program.  I look forward to working with some of you to bring vital new services and innovation to healthcare.  Please visit www.brightworkadvisory.com to check out our offerings and perspectives.  Best!  Looking forward to the 2019 JPM Healthcare week.

Strategy should be revisited at least annually.  Contact BrightWork Advisory, LLC to schedule our participation in your next review to bring experienced, fresh perspective to your discussion.

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