Following the raid, the company’s co-founders resigned
from the board of directors
Microbiome testing company, uBiome, a biotechnology developer that offers at-home direct-to-consumer (DTC) test kits to health-conscious individuals who wish to learn more about the bacteria in their gut, or who want to have their microbiome genetically sequenced, has recently come under investigation by insurance companies and state regulators that are looking into the company’s business practices.
CNBC
reported that the Federal Bureau of
Investigation (FBI) raided the company’s San Francisco headquarters in
April following allegations of insurance fraud and questionable billing
practices. The alleged offenses, according to CNBC, included claims that
uBiome routinely billed patients for tests multiple times without consent.
Becker’s
Hospital Review wrote that, “Billing documents obtained by The Wall Street
Journal and described in a June 24 report further illustrate uBiome’s
allegedly improper billing and prescribing practices. For example, the
documents reportedly show that the startup would bill insurers for a lab test
of 12 to 25 gastrointestinal pathogens, despite the fact that its tests only
included information for about five pathogens.”
Company Insider Allegations Trigger FBI Raid
In its article, CNBC stated that “company insiders”
alleged it was “common practice” for uBiome to bill patients’ insurance
companies multiple times for the same test.
“The company also pressured its doctors to approve tests
with minimal oversight, according to insiders and internal documents seen by CNBC.
The practices were in service of an aggressive growth plan that focused on
increasing the number of billable tests served,” CNBC wrote.
FierceBiotech reported that, “According to previous
reports, the large insurers Anthem, Aetna, and Regence BlueCross BlueShield
have been examining the company’s billing practices for its physician-ordered
tests—as has the California Department of Insurance—with probes focusing on
possible financial connections between uBiome and the doctors ordering the
tests, as well as rumors of double-billing for tests using the same sample.”
Becker’s Hospital Review revealed that when the FBI
raided uBiome they seized employee computers. And that, following the raid,
uBiome had announced it would temporarily suspend clinical operations and not
release reports, process samples, or bill health insurance for their services.
The company also announced layoffs and that it would stop
selling SmartJane and SmartGut test kits, Becker’s reported.
uBiome Assumes New Leadership
Following the FBI raid, uBiome placed its co-founders Jessica
Richman (CEO) and Zac
Apte (CTO) on administrative leave while conducting an internal
investigation (both have since resigned from the company’s board of directors).
The company’s board of directors then named general counsel, John Rakow, to be interim CEO,
FierceBiotech
reported.
John Rakow (center) is shown above with uBiome co-founders Jessica Richman (lower left) and Zac Apte (lower right). In a company statement, Rakow stressed that he believed in the company’s products and ability to survive the scandal. His belief may be based on evidence. Researchers have been developing tests based on the human microbiome for everything from weight loss to predicting age to diagnosing cancer. Such tests are becoming increasingly popular. Dark Daily has reported on this trend in multiple e-briefings. (Photo copyrights: LinkedIn/uBiome.)
After serving two months as the interim CEO, Rakow resigned
from the position. The interim leadership of uBiome was then handed over to
three directors from Goldin
Associates, a New York City-based consulting firm, FierceBiotech
reported. They include:
SmartFlu: a nasal microbiome swab that detects bacteria and viruses associated with the flu, the common cold, and bacterial infections.
What Went Wrong?
Richman and Apte founded uBiome in 2012 with the intent of
marketing a new test that would prove a link between peoples’ microbiome and their
overall health. The two founders initially raised more than $100 million from
venture capitalists, and, according to PitchBook,
uBiome was last valued at around $600 million, Forbes
reported.
Nevertheless, as a company, uBiome’s future is uncertain. Of
greater concern to clinical laboratory leaders is whether at-home microbiology
self-test kits will become a viable, safe alternative to tests traditionally performed
by qualified personnel in controlled laboratory environments.
Though patients get a big discount when paying for drugs, copay accumulators prohibit discounts from applying to plan deductibles, extending time it takes for enrollees to reach full plan coverage
There’s a new insurance/payer industry tactic in town and Dark Daily thinks clinical laboratories and anatomic pathology groups should know about it. It’s called a “copay accumulator” and it was designed by payers in response to pharmaceutical company copay assistance cards and discount coupons.
How do Copay Accumulators Work?
Many consumers use manufacturer copay assistance programs, copay cards, and coupons to afford expensive brand-name medications. As payers attempt to make consumers pay a higher portion of drug costs, pharmaceutical companies have responded by offering financial aid to patients in the form of copay assistance cards and coupons. These discounts insulate patients from having to pay the full deductible required by their health insurance plans for medicines prescribed by their doctors.
However, payers say these deductibles were designed to motivate patients to monitor the price of prescribed drugs and discourage the overutilization of costly medicines. A primary goal of price transparency and precision medicine.
The upside to payers is, with a copay accumulator in place, the amount of those manufacturer discounts does not count toward the patient’s insurance deductible. And the longer it takes for patients to reach their deductibles, the longer the insurer gets to collect copays, which adds to the controversy of copay accumulators.
Also, prohibiting drug manufacturer discounts from counting toward a patient’s insurance deductible prolongs the time patients have to wait before full coverage begins. Thus, more upfront costs are shifted to consumers.
Others, however, claim manufacturer discounts are simply marketing schemes used by pharmaceutical companies to keep drug costs high.
“The true issue remains that drug pricing continues to skyrocket, with no clear explanation on how those prices are set,” Cathryn Donaldson, Director of Communications, America’s Health Insurance Plans (AHIP), told the LA Times. “Copay coupon programs hide the true impact of rising prescription drug costs.” (Photo copyright: AHIP.)
Patients Stuck in the Middle
Physicians and patient advisory groups worry that shifting more drug costs to patients may affect therapy adherence and cause confusion for consumers.
“But the Achilles heel for the pharmacy benefits manager is that you’re hurting the patient, who is stuck in the middle,” continued Vogenberg. “Patients may end up not taking or getting a drug, which is not good for anyone. And it’s not really affecting pricing because patients are still hurting. Unfortunately, it makes the third-party payer look like a crook.”
Managed Care notes that, according to a recent survey of 170 employers conducted by the National Business Group on Health (NBGH), 29% of employers plan on using copay accumulators in 2019. That’s up from the 17% of employers who are currently using them.
“They are not universal yet,” Steve Wojcik, Vice President of Public Policy at the NBGH, told Managed Care. “But they will probably continue to be one tool that employers use to keep costs down.”
Drug Costs Down, Cost to Patients Up
The struggles between payers and big pharma could be heating up. Studies show utilization of copay accumulators may be negatively impacting drug company revenue. Research conducted by Sector and Sovereign (SSR) found that retail drug prices in the United States fell 5.6% during the first quarter of this year. During the same period last year, prices fell just 1.7%. SSR’s report states that most of the decline in prices is due to copay accumulators.
“Unless manufacturers adapt their copay support programs fairly drastically, net price declines may worsen in 2019,” SSR analyst Richard Evans told Reuters.
Clinical laboratories might not directly feel the effects of copay accumulators. Nevertheless, anything that impacts patients’ ability to pay, especially those on high-deductible health plans, should be on the radar of smart lab managers and stakeholders.
Shift from fee-for-service to value-based reimbursement is fueling increase in joint ventures and co-branded insurance products, creating opportunities for nimble clinical laboratories and anatomic pathology groups
As healthcare moves from fee-for-service to value-based reimbursement, health insurers and providers are joining forces at a steadily increasing rate, with nearly three-quarters of partnered products in early 2018 being joint ventures or fully co-branded insurance products. This trend presents an opportunity for clinical laboratories to help providers become more effective in their use of laboratory tests as they aim for better patient outcomes and lower treatment costs.
While health systems integrating with insurance services is not new, the roll out of the Affordable Care Act (ACA) in 2014 and its emphasis on value-based reimbursement helped create renewed interest in vertical integration, notes Becker’s Hospital Review.
According to consulting firm Oliver Wyman, the number of payer-provider partnerships has grown rapidly over the past six years, with 73% of the 22 insurance products launched in the first quarter of 2018 being joint ventures of co-branded offerings.
In comparison:
22% of partnerships were joint ventures or co-branded in 2014:
33% in 2015;
57% in 2016; and,
71% last year.
Of the 22 new payer-provider partnerships announced this year, 20 product announcements explicitly emphasized value-based compensation, while compensation was implied but not mentioned in the final two product-based partnerships.
“Payers and providers continue to be interested in forming product-based partnerships,” Oliver Wyman stated when releasing the new data. “Our analysis … continues to show a steady increase of trend toward deeper partnership, with more co-branding, greater levels of value-based financial alignment, and other forms of closer collaboration and joint ventures.”
Oliver Wyman cited several “notable” new entrants:
In addition, Oliver Wyman noted that national payers Aetna and Cigna added to their growing rosters of joint ventures in 2018.
Speaking with Healthcare Dive, Tom Robinson, Partner, Health and Life Sciences at Oliver Wyman, described this year’s new ventures as varying in type, size, location, and model. He noted that 50/50 joint ventures with co-branding have gained in popularity, however, accountable care organizations (ACOs), pay-for-performance, and bundled-payment models also are being formed. Robinson believes these vertical integrations offer opportunities for innovation.
“The point of these partnerships is to create something new, rather than just building the same old offerings with a narrow network,” Robinson said. “Successful partnerships will take the opportunity to innovate around the product and experience now that the incentives, insight, investment and integration are all for it.”
In the video above, Oliver Wyman Health and Life Sciences Partner Tom Robinson discusses the emerging trend of payer-provider partnerships, and he highlights unique challenges and opportunities of these joint ventures. Click here to watch the video. (Photo and caption copyright: Oliver Wyman.)
Lower Costs, Improved Access, Through Payer-Provider Partnerships
In announcing Blue Cross Blue Shield of Rhode Island (BCBSRI), and Lifespan’s launch of coordinated healthcare plan BlueCHiP Direct Advance, BCBSRI President and Chief Executive Kim Keck pointed to the plan’s ability to drive down healthcare costs.
“We hear a consistent theme from our members—they want more affordable health plan options—and through our collaboration with Lifespan we are doing that,” Keck stated in a news release. “BlueCHiP Direct Advance is an innovative product that features Lifespan’s vast network of providers who are positioned to more effectively manage and coordinate a patient’s care. And, our partnership allows us to offer this new product at a cost that is 10% lower than our comparable plans.”
When Allina Health System of Minnesota and Aetna last year announced their partnership plans, Allina Chief Executive Penny Wheeler, MD, praised the ability of “payer-provider” partnerships to improve care coordination and increase access to preventive care.
Jim Schowalter, MPP, President and Chief of Executive of the Minnesota Council of Health Plans, told the Star Tribune the joint venture between the for-profit insurer and local health system would accelerate the shift within the state to value-based care.
“This is another effort in our state that moves us away from old fee-for-service systems,” Schowalter stated. “Working together, doctors and insurers can deliver better personal care and hold down medical expenses.”
While the future of the ACA and other healthcare reforms is uncertain, clinical laboratories and anatomic pathology groups should expect healthcare networks and insurers to continue to find ways of partnering. That means pathologists can expect to have an expanded role in helping providers improve patient outcomes and reduce healthcare spending.
As healthcare continues to expand outside of traditional environments, clinical laboratories must adapt to providers’ changing needs
Healthcare settings continue to pop up in non-traditional locations. For years, clinical laboratories and anatomic pathology groups have had to adopt to a changing healthcare landscape, such as the trend to move care out of hospitals and doctor’s offices to lower costs and improve access.
It’s a win-win for healthcare organizations and patients alike that shows no sign of slowing down. Thus, it should come as no shock that retail giant Walmart (NYSE:WMT) would want to remain competitive in this high-value consumer market.
Walmart Continues Expansion into Healthcare Market
Walmart Care Clinics, which are primarily staffed by certified nurse practitioners, are currently operating in Georgia, South Carolina, and Texas, according to Healthcare Finance. Caregivers in those clinics are trained to diagnose and treat a wide variety of basic medical conditions, including:
Managing chronic conditions;
Performing lab tests;
Administering vaccinations;
Making referrals; and,
Prescribing medications.
Now, possibly in a bid to compete with CVS and Walgreens, Walmart has announced plans to allocate part of an $11-billion remodeling project to include private consultation rooms in hundreds of its store pharmacies. These rooms will allow customers to have confidential discussions about their medications and healthcare with pharmacists and other pharmacy staff members.
The majority of the store renovations will occur in Florida and Texas where the company has allotted $477 million to remodel 82 stores and add 14 new stores.
Walmart Health App and Wellness Days
Another step Walmart is taking to compete in the healthcare space involves mobile software. In May, Walmart announced it was partnering with digital health company Sharecare to provide employees and community members with access to the Sharecare mobile healthcare app. The app enables users to complete personalized health profiles and track their health.
Walmart Wellness Days are a quarterly in-store event designed to educate community members on ways to make positive changes in their health. Might clinical laboratories one day be performing medical laboratory and pathology testing ordered by physicians and nurse practitioners located in retail Walmart pharmacies? (Photo copyright: Walmart.)
“Walmart is committed to helping our associates, their families, and communities to improve their overall wellbeing through wellness programs,” Jacqui Canney, Executive Vice President and Chief People Officer at Walmart, stated in a press release. “Partnering with Sharecare will provide our associates additional tools to inspire them on their wellness journey, help our programs continue to grow, and be a force for change in the communities we serve.”
Sharecare sees this relationship as both disruptive and transformative, not just for a company’s employees and customers, but for the entire nation.
“As we have learned from our research through the Gallup-Sharecare Well-Being Index, a person’s holistic wellbeing is defined by five essential elements—purpose, social, financial, community, and physical—and when those elements are in alignment, individuals and places exhibit greater adaptability to change, resiliency, and productivity in the workplace, among other benefits,” noted Dan Witters, Research Director for the Gallup-Sharecare Well-Being Index, in the press release. “As the nation’s single largest employer with more than 1.5 million associates, Walmart and Sharecare have the potential to disrupt the status quo of workplace wellness and transform the health not only of the communities in which Walmart operates, but also, ultimately, our country.”
Lofty expectations, to be sure. Nevertheless, for clinical laboratories to remain competitive, they must be prepared to adapt and serve healthcare providers in any location. Increasingly, these caregivers are finding themselves treating patients outside of traditional healthcare environments in locations convenient to healthcare consumers, such as retail environments.
Genetic counselors struggle to explain direct-to-consumer genetic test data—or correct provider misinterpretations of results—while often encountering resistance and anger from patients who don’t accept their counseling
Healthcare consumers who want to know more about their family’s genealogy are purchasing direct-to-consumer (DTC) home genetic tests in record numbers. It is a trend that worries some medical laboratory professionals and certain federal government agencies.
MITTechnology Review (MIT) dubbed 2017, “The year consumer DNA testing blew up.” As a result of record-breaking sales of DTC genetic testing last year, about 12-million people have now been tested, MIT reported. “The inflection pointed started in the summer of 2016, and from there it’s gone into the stratosphere,” David Mittelman, PhD, Molecular Biophysics, told MIT.
Clearly, consumers are becoming comfortable with the concept of genetic testing on themselves and their family members. However, major issues—such as who owns genetic information and how patient privacy is protected—have yet to be resolved.
Dark Daily recently reported that more than 1.5 million kits were sold by Ancestry.com during the four-day Black Friday/Cyber Monday weekend prior to Christmas 2017. That e-briefing also explored related privacy issues and informed readers about efforts by federal lawmakers to explore genetic testing companies’ privacy and disclosure practices.
According to a news release, by the end of November, sales of AncestryDNA kits exceeded the total number of subscribers the Utah-based company had when it started the year. Now, more than seven million people are in Ancestry’s database.
Meanwhile, 23andMe, a personal genomics company established in 2006, has genotyped more than three million people worldwide. In addition to an ancestry test, it offers a health and ancestry service providing information on genetic health risks, carrier status, traits, wellness, and ancestry, according to the company’s website.
Experts Concerned About Privacy and Use of ‘Raw’ DNA Data
“2018 will bring a regular drumbeat of new experiences and enhancements across both DNA and family history,” Howard Hochhauser, Ancestry’s Interim Chief Executive Officer, predicted in the news release.
However, a recent study published in Translational Behavioral Medicine (TBM) which noted the robust sales of DTC genetic tests in 2017, also called attention to a new concern surrounding the impact of “raw” DNA interpretation results.
“People often enter the direct-to-consumer market for recreational purposes, such as learning about their ancestry. Yet, what we started seeing was that these same individuals subsequently come across third-party interpretation services where they proceeded to learn more about their ‘raw’ DNA made available by the ancestry testing companies,” stated Catharine Wang, PhD, Boston University (BU) Associate Professor of Community Health Sciences, and the study’s lead author, in a BU statement.
The study cited sales of DTC genetic tests at $99 million in 2017 and explored potential negative implications of consumers’ access to “raw” DNA data.
“We were especially interested in the downstream implications of receiving unexpected disease risk information from these newer services that subsequently lead consumers to seek out a genetic counselor’s consult,” Wang noted.
Catharine Wang, PhD (above), Associate Professor of Community Health Sciences at Boston University and lead author of the study, notes, “There are a lot of people saying, ‘I’m smart enough to make decisions; give me the information and get the doctors out of the way. But they’re making some serious decisions about their health after seeing only part of the picture.” (Photo copyright: Boston University Research.)
After Getting DNA Data, Consumers Turn to Interpretation Services, Genetic Counselors
The research team surveyed 85 genetic counselors. Fifty-three percent of them reported meeting with DTC test costumers who had accessed ‘raw’ DNA data and used genetic interpretation companies, which are not regulated by the US Food and Drug Administration (FDA), to get more information about themselves. However, results of the sessions were not always positive for either patients or counselors.
According to the study, counselors reported their biggest challenge as “undoing misinterpretations and correcting patient beliefs about their raw DNA results.”
The study noted, “When genetic counselors tried to clarify misunderstandings, patients were not only resistant but sometimes appeared hurt and frustrated that counselors were not taking their results seriously.”
Other negative experiences counselors reported while interpreting “raw” DNA test results for patients include:
“Time required to review and understand interpretation reports;
“Feeling ill equipped and uncomfortable providing the service;
“A lack of supportive organizational structure; and,
“[Having to] correct a patient’s misunderstanding, following a primary care physician’s misinterpretation of her raw DNA results.”
“Counselors expressed concern about the quality of the raw data and the clarity and usefulness of interpretation reports. Efforts to better support both consumers and genetic service providers are needed to maximize the effective translation of genome-based knowledge for population health,” the study authors concluded.
Providers Should Improve Ability to Help Patients with DTC Genetic Data
In a MedCity News blog post, Peter Hulick, MD, Director of Personalized Medicine, NorthShore University HealthSystem, called for healthcare providers to assist patients who are dealing with new DTC genetic services and possible data overload.
“Findings show having widespread access to personal genetic information—without the knowledge of how to interpret results—can lead to problems ranging from misinterpretation to emotional distress,” he noted. “The medical community must work harder and smarter to incorporate this information into practice and empower patients as consumers and partners in healthcare decision-making.”
Anatomic pathologists and clinical laboratory leaders also should acknowledge and monitor consumers’ growing interest in these tests. Once patients’ have their DNA sequenced, the likelihood they will seek to know their predisposition to diseases is high and increasing. Thus, opportunities exist for medical laboratories to help physicians and consumers interpret DTC test results.
January’s press release confirmed the tech company is working to integrate critical medical data into its mobile devices, while further promoting interoperability and patient access
While interoperability has improved since the earliest electronic health record (EHR) systems, today’s active patients often need to sort through multiple healthcare portals—including those of clinical laboratories and anatomic pathology groups—to get a comprehensive view of their medical history. Not only can this be time consuming, but also inconvenient if the patient lacks access to a computer.
Thus, it’s no surprise that in a January 24 press release, mobile technology giant Apple announced plans to enter the development ring and create an improved EHR for its mobile device users by updating its existing “Health” mobile application (app). The iOS 11.3 update, among other things, is designed to enable Apple iPhone owners to receive critical medical data, such as medical laboratory test results, directly on their devices.
“Our goal is to help consumers live a better day. We’ve worked closely with the health community to create an experience everyone has wanted for years—to view medical records easily and securely right on your iPhone,” said Apple COO Jeff Williams in the press release.
Jeff Williams (above), COO at Apple, notes that, “By empowering customers to see their overall health, we hope to help consumers better understand their health and help them lead healthier lives.” (Photo copyright: Apple.)
The new features are already available to developers in the latest iOS 11.3 beta 3 release. However, release to the public is expected soon with the issuance of the iOS 11.3 final release. This means that patients will not need to download extra apps—or remember to use them—to take advantage of the feature.
New Way to Improve Patients’ Access to Health Data or Just Another Data Silo?
The Apple Health Records platform adheres to Fast Healthcare Interoperability Resources (FHIR) protocols for transmission of data. Providers send information to Apple which then aggregates the information, transmits it to patients’ iPhones and notifies them of the updates.
All information stored on the device is encrypted in storage and protected from unauthorized access by the user’s password.
Through the new Health Records interface, users view this aggregated data as a timeline, conduct searches, and share information with other parties as they deem appropriate.
Current medical information listed in the press release includes:
Allergies;
Conditions;
Immunizations;
Clinical laboratory results;
Medications;
Procedures; and,
Vitals.
Currently, the platform integrates data from three major EHR developers:
Epic;
Cerner; and,
AthenaHealth
Apple’s update to the Health app makes it easier for people to access and control of all of their health records and data. This included medical laboratory tests. (Image and caption copyright: Apple.)
Apple is also working with 12 health institutions across the US in the first phase of the project, including:
In the Apple press release, Stephanie Reel, CIO at John Hopkins Medicine in Baltimore, stated, “Streamlining information sharing between patients and their caregivers can go a long way towards making the patient experience a positive one. This is why we are excited about working with Apple to make accessing secure medical records from an iPhone as simple for a patient as checking email.”
Previous Attempts at Mobile Health Record Devices Got Mixed Results
This isn’t the first time a major technology company has attempted to enter the mobile health market. Google Health was shuttered in 2011 citing low adoption. Wearable fitness trackers, such as Fitbit (NYSE:FIT) enjoyed a bubble, but are now seeing mixed success in terms of long-term adoption and use, according to The Motley Fool. More to the point, they’ve never quite become the holy grail of monitoring and data collection that some experts predicted, Huffington Post reported.
Larry Dignan, Editor-in-Chief at ZDNet, builds a compelling case for why this could be the attempt that succeeds in providing a consolidated platform for clinical laboratories, physicians, and other care providers to push data directly to patients and—with the patient’s permission—to each other, regardless of the platforms healthcare facilities use to store and transmit data.
He notes that much of Apple’s newest features build on foundations laid by the healthcare industry to create scalable, functional EHR systems. By working with existing protocols, Apple’s Health Records platform is already positioned for compatibility with many healthcare providers.
Furthermore, Apple is already known for partnering at the enterprise level with major businesses and industries, while also holding the trust of millions of Americans who store their personal information on Apple devices.
Is Apple the Future of EHRs?
Despite this, until the platform—and adoption by the public—is proven a success, it will be yet another walled garden of medical information. Even then, Apple is only one segment of the global mobile market.
Unless Apple provides access to other platforms (such as Android), those patients—and the medical communities serving them—are left consolidating information on their own through a sprawl of various portals. This also means that medical laboratories, pathology groups, and other service providers must continue to invest time and funding into communicating data in ways compatible with a plethora of internal and external systems and software.
Still, the platform offers an intriguing glimpse at the future of medical records and heralds a shift toward empowering patients with easy, comprehensive access to their own data, which would be a boon to the medical laboratory industry.
