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The inside story of internal dissent over a popular UnitedHealth algorithm
A new investigation out this morning reveals how UnitedHealth‘s acquisition of a popular Medicare Advantage algorithm developed by NaviHealth sparked internal dissent over denied care for seriously ill patients.
My colleagues Casey Ross and Bob Herman previously reported that NaviHealth’s algorithmic denials terminated insurance payments for Medicare Advantage patients, who were forced to either forgo care or pay thousands of dollars out of pocket. Their new investigation shows the denials weren’t just impacting patients and physicians — clinical staffers within NaviHealth itself told STAT they had become increasingly distressed by the way their bosses were letting an algorithm override their discretion on patients needing continued care.
Ultimately, the decision to cut off payment for a patient’s care was left up to one of the company’s physician reviewers. But former employees told STAT that the process itself was built around the algorithm, and the timeline it set.
“They have so many stops to keep a nurse or a therapist from going rogue and just pushing past that [discharge] date,” one former patient chart reviewer said.
Palantir’s nascent health care team caters to hospitals
I recently dropped by an AI conference hosted by analytics company Palantir — the sometimes shadowy and often controversial behemoth perhaps best known for its government intelligence and military data management contracts. I was especially intrigued by the handful of large health systems demo-ing the technology at Palantir’s Palo Alto headquarters, including Cleveland Clinic and Tampa General Hospital.
Palantir, co-founded by venture investor, entrepreneur, and former Trump adviser Peter Thiel, has been quietly building its health care business from the ground up. The goal, health care leads Jeremy David and Drew Goldstein told me, is to apply some of the same services Palantir uses in other complex and highly regulated industries to mitigate hospital pressures like clinician shortages, burnout, and limited hospital beds.
Palantir has just nine U.S. health systems, also including HCA Healthcare, using the technology to manage dynamic and often difficult-to-predict factors like staffing or lab test needs. And though it’s early days, it’s still not clear if Palantir can unseat health IT incumbents offering similar technology.
The technology is largely designed for hospital administrators and clinicians, not patients, and health systems told me they do not share identifiable patient information with Palantir. But especially given Palantir’s roots in government and intelligence — and the aversion to any potential perception of privacy risk — I was surprised that no health system I spoke with explicitly disclosed their Palantir contracts to patients within consent forms, though they did promote the partnership publicly. Read the full story here, and send your thoughts my way.
Digital health funding stays low as new reality sets in
Digital health startups raised $6.1 billion in the first half of 2023, and funding is on track for the lowest year since 2019, according to new data released by Rock Health. The second quarter, meanwhile, saw just $2.5 billion in funding.
At this point, it’s not a new trend: Health tech funding numbers have been falling for some time from their 2021 peak, when companies raised $29 billion. Ultra-low interest rates and changes in health care prompted by the pandemic aren’t creating investor frenzy any more.
“This sector now is a smaller sector and that’s not necessarily a bad thing,” Adriana Krasniansky, the head of research at Rock Health told STAT’s Mario Aguilar. “It’s just time for us to all kind of acknowledge that reality.”
The new funding environment has placed pressure on companies that raised when the money was flowing and now have more limited options. We’ve already seen companies go bankrupt or sell off their assets. Many companies have resorted to raising rounds that aren’t given a letter name so that they can avoid publicizing lower valuations, the report notes. This is all part of a larger recalibration that needs to happen, said Krasniansky.
“If a startup has been wondering whether or not they have to adjust their valuation from what they might have raised in 2021 or in a different market context, It’s probably time to make that decision, and it could be really helpful in the long run,” she said. “We’ve seen a lot of companies really bogged down or limited by the valuations that they established in early 2021.”
HCA discloses data breach affecting 11 million
Speaking of HCA, the Nashville, Tenn.-based health system said Monday that hackers had stolen patient data from an external storage system and posted it online, my colleague Tara Bannow reports. Exposed information includes patients’ names, email addresses, and service locations. HCA said it didn’t believe clinical or payment information was compromised, but did not disclose when the breach — likely the largest ever reported by a health provider — occurred.
Health systems are increasingly vulnerable to cyber attacks, potentially because the industry spends much less than other sectors on protection, Chad Holmes from health cybersecurity company Cynerio told Tara.
“Other industries care about protecting dollars; health care cares about protecting people,” Holmes said. “They’re adopting modern technology to care for patients, but they think anything not spent on patient care is wasted.”
Info blocking enforcement is imminent
The federal health department will soon start enforcing the ban on interfering with health data transfer — a practice known as information blocking — with an up to $1 million penalty starting Sep. 1. The Office of the Inspector General is responsible for enforcement against health IT developers and health information exchanges and networks, but not health care providers; HHS is working on a separate rule establishing disincentives for providers.
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