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April 7, 2021: It's been a wild year for digital health. How has the pandemic influenced this space? It's hard to imagine a one size fits all for addressing patient care. That’s where Xealth comes in. It’s a digital prescription platform that lets clinicians prescribe digital health tools to patients. Think of it like the SureScripts of digital health. Today their CEO Mike McSherry joins us. What is Xealth doing for payers and providers? How are digital tools impacting patients in terms of quality and experience? Have the demands from consumers changed over the last year? How will health systems start to differentiate based on new sets of digital tools that are in play and being developed? Can hospital systems afford to invest in a digital health feature or can they afford not to? And what will the healthcare consumer experience be in 2025?

Key Points:

  • One explosion in digital health was around virtual care for certain disease states. Diabetes management, behavioral health and hypertension remote patient monitoring increased exponentially. [00:03:55
  • The Teladoc Livongo merger is a sign of the rise of digital health and app based care management [00:04:10
  • Consumer expectations in healthcare are currently at an analog experience level [00:14:35
  • Healthcare is at the opposite end of the consumer experience spectrum. It needs to solve that magical middle and then bookend it to create a seamless consumer friendly care experience. [00:16:20
  • Parking is one of the biggest complaints of going into a health system [00:17:25
  • At the end of the day, convenience always wins [00:42:05
  • Xealth 
Transcript

This transcription is provided by artificial intelligence. We believe in technology but understand that even the smartest robots can sometimes get speech recognition wrong.

 Thanks for joining us on this week in Health it. This is a Solution showcase. My name is Bill Russell, former Healthcare CIO for a 16 hospital system and the creator of this week in Health, IT at channel dedicated to keeping Health IT staff current and engaged. Today I'm joined by Mike McSherry, the CEO of Zel, a digital health startup, and we talk a lot of different things.

We obviously, we talk about Zel a little bit, but we also talk about, I. How health systems can differentiate themselves using digital tools. I think this is gonna be a key differentiator moving forward. Great conversation. I think you'll enjoy. Special thanks to our influence show sponsors, Sirius Healthcare and Health lyrics for choosing to invest in our mission to develop the next generation of health IT leaders.

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You can also go to today in health it.com, and now onto today's show. All right. This morning we have Mike McSherry, the CEO of Digital Health Startup Zel online. Good morning, Mike. Welcome to the show. Hi, bill. Thanks for having me. Excited. You know, I, I, I'm really looking forward to this conversation. We've been near each other.

I mean, I was, I, I was at St. Joe's. You were incubated out of Providence, but we, we never really got to, got to work together. So I'm, I'm looking forward because I've been following for, for a number of years. You guys are doing some, uh. Yeah, no thanks. We, as you said, we were incubated inside of Providence up in Seattle, and, and while we were still being incubated, they merged with St.

Joseph's, but we were working on the epic side of Providence, and by the time we, we got to working with St. Joseph's, you had already left, uh, the system. But we're still colleagues. We're still trying to advance digital health and, and, you know, healthcare, it, you know, technology to the forefront of, of patient care.

Let's, let's start there. I I, I am gonna circle back. We're gonna talk about Zelle in, in the middle of this podcast, but let's start with digital health. You know, it's, it's been a, a wild year, a very interesting year in digital health. How has the pandemic really influenced the digital health space? Well, I mean e exponential growth when, when all patient care essentially stopped, you know, the, you, you went from maybe 3% of patients having done some telehealth experience to, you know, reaching 80% in some kind of targeted timelines.

But since come down, I think, I think what we're hearing across provider systems is there's gonna be a new normal of 60, 40, 60% back to like some in per in-person kind of care, and 40% . Remaining sort of loyal or, or convenient towards the, the telehealth experience. But that's just on the, you know, face-to-face or asynchronous kind of engagement level.

The other explosion in, in digital health was around virtual care for certain disease states. And you take a look at the diabetes management, the behavioral health, you know, hypertension, remote patient monitoring, that, that increased exponentially. And, and I guess the, the high watermark of that was . The Teladoc Livongo merger.

You know where Teladoc bought Livongo for $18 billion. And that's just a sign of the times of the rise of, of digital health and app-based care management, online telehealth, coaching specific to disease state RPMs. I like continuous glucose monitoring or, you know, patient engagement, you know, metrics, you know, tracking patient adherence and engagement to that.

So it, it's not just the telehealth, which oftentimes gets lumped into . You know, digital health and the new front door strategies, but it's the end end care referral into these apps and services and in-home care treatments. And the RPM associated with that. Did the, did the Livongo valuation surprise you at all?

Is that an indication of the potential that that exists in this remote patient monitoring and, and, and really digital care plans? I, it, it was absolutely shocking, I think, to me, and, and the market. But you know, I think Teladocs playing the long game here, that there's gonna be modality of of care delivered virtually and, and Livongo's expanded beyond just diabetes management.

They do pre-diabetes, they do behavioral health. I don't know if they've bought or built an Ms K solution yet, but you assume that they're gonna expand into all sort of chronic care disease states and, and I think Teladoc, you know, took a bet that this is gonna be a. Not, not quite a winner take all, but certainly, you know, an oligopoly type structure.

You know, against that, and, and it was worth $18 billion to them. I haven't looked at the stock price now, I don't know, you know, how much it's come down, whether it's still, you know, worth that on their balance sheet, but they're, they're playing to have, you know, the, you know, back to that 40% it's gonna be delivered, you know, telehealth and, and virtual care and then.

The downstream referral. If you can cost, contain and keep that into your own, in-house solution state, you're gonna be able to provide lower cost of care. And, and, you know, we all know that that's the end game. How do you provide a lower cost of care at, at, you know, equal or better outcome levels? And, and that's what they're betting on, on achieving.

And they're the first out the gate. You know, you have to assume that ADA and WellDoc and, and a couple of these other platform plays have achieved, you know, multi-billion dollar evaluations, you know, and creeping up into that level. But it was a shock to the industry and a real wake up call. How the industry is responding, you know, is measured in, in different increments depending upon which sector, payer, provider, you know, employer, pharma, et cetera, you know, as to how aggressively they're playing in this digital health game.

That, that feels to me. I, I'm already way off script here, but that feels to, it feels to me the, the. The entry point that you're going to compete with health systems appears to be, uh, to get in, get in the way of, uh, primary care, and also to figure out a way to essentially bypass all of it and go straight to the home.

And, and I've talked to some people about just this concept of, of the Airbnb. For, for beds, for hospital beds. I mean, if we can continue to build beds with a high acuity in the home, that appears to me to be the, the place that the digital startups can really, I don't know, sort of surprise is the wrong word.

It feels like it's wrong word, but, but, but really surprise start to take some of that, that revenue slowly take some of that revenue away from, from. Yeah, I, you know, I, at the end of the day, I think it's gonna be a hybrid model. I mean, look at Optum, you know, buying physician practices so they can actually have some face-to-face care delivery.

But, but you're right. I. So much is going to this virtual first touchpoint and, you know, payers of, you know, I mean Express Script, Cigna just bought, uh, MD Live so much is going to this telehealth first, and, and payers that that control the premium, control the, the patient, you know, out-of-pocket. Can, can incent like start with my telehealth experience and you know, then you've got the new entrance, you know, the Amazon care.

You've got the new front doors of, you know, what, what Walgreens is trying to do, what Walmart's trying to do, you know, and, and they're all starting with these virtual experiences. But if, if you start with a virtual first and, and you can kind of treat whatever that that care protocol is with, with that patient need virtually.

They're all trying to have asset light infrastructure to refer virtually, you know, Teladoc buying Livongo Express Scripts, building their digital health formulary, Optum, you know, United . Building and buying their own formulary. They bought able to, they bought vivify. They're building a diabetes management solution.

So in as much as they can refer patients virtually, they're going to, I mean, how, how many people start an e-comm experience then choose the in-store pickup option? No, you, you wanna closed loop in as much as possible on that virtual experience if, if it's satisfactory and, and achieves the, the need of, you know, resolving that, that patient issue and

Only then if you can't solve it virtually, do you refer them to the expensive hospital system infrastructure? And you know, keep in mind that you know, everything we just referenced, the Amazon, the MD live, the Teladoc, the Livongo, the, you know, they're all commercially insured patients. And so if these commercially insured patients get routed away from hospital systems, then that, that destroys the, the provider finances.

you know, if they're solely relying upon CMS and Medicaid Medicare reimbursement structures. Yeah. All right. So let's, let's talk about the viability of, of some of this stuff. We've seen a lot of progress over, uh, a number of years, a lot of money coming into the space, digital tools. Let's talk about that.

Progress. Does, does, and really, I'm, I'm gonna go in three different directions here, and the first being, let's see, which I, let's go. You know, have we seen digital tools impact quality? Do we have those kinds of metrics that we are showing people to say, look, we can provide a better level of quality if you implement these digital tools along the way.

So in, in our definition of digital health, it, it spans from patient education to shared decision making tools to apps that, that manage diabetes or, you know, hypertension or, you know, behavioral health as well as the. Facility of, of prep and recovery. So when you talk about quality in, in many cases, we're sending out pre, pre-surgical educational material or presid, pre-surgical digital pathways.

Stop eating here, stop drinking here. Make sure you bring this to the hospital system. Make sure you have this at home on the recovery pathway. And so that addresses quality. Even though it's a digitized patient education experience, so is that digital health? Maybe not in the app, app-based world, but it is digital engagement with the patient that's leading to better quality and and outcome measurements.

So that's, that's one definition we definitely have. We've got data showing. Behavioral Health. Silver Cloud is a behavioral health app. We've launched that at three different systems and we're enrolling about two thirds of all the patients who've ever been prescribed that app actually adopt the solution.

And then 75% of them are showing improved PHQ nine. So that is definitely an outcome in quality measurement metric against that. We do an awful lot in maternity care and you know, in maternity, you know, highly expectant mom, highly engaged against her, her care, and the newborn child prep. The sort of what to expect when you're expecting on that level.

And what we're trying to do is correlate how much is an in, you know, in light of telehealth that all needed to have a di device accompaniment. So how is the blood pressure cuff and, and scale weight of, of the mom tracking against her healthy pregnancy so that otherwise healthy mom checkup can be done in a telehealth experience with that added device diagnostics.

So that's leading towards quality outcomes. We try to correlate that directly to low NICU events or, or reduced low birth weight events. But, but, you know, quality scores solely based on digital engagement is the only, you know, kind of a attribute is, is probably a little difficult against all the other social, uh, determinant and, you know, other kind of, uh, considerations associated with that mom and, and the healthy birth of a child.

Yeah. So, so.

Areas that's really in the wheelhouse of a, a digital, digital solution, a digital set of tools are the, have the habits, have the demands from the consumer changed, do you think, over the last year to say, look, digital first standpoint.

Their, their, you know, their online visits. They were happy with remote monitoring for chronic conditions. And the reason they were happy is because they were told that it was unsafe to go to the hospital. And so they found a solution that they felt was more safe. But after doing that for nine months, do you think that changes a behavior?

Do you think there's gonna be more engagement from that perspective and, and conversely, a better experience all around? Yeah, there's absolutely, and you know, we all talk about the consumerization of healthcare and you know, we can all do mobile banking transactions, we can book flights on our phones or you know, websites, et cetera.

So much of your consumer life can be transacted digitally. But when you hit the healthcare world, there's phone calls, there's faxes, there's it, it, I, I jokingly call it the lowest common denominator, you know, hospital system's like, well, not if a hundred percent of people can't do something on their phone, then let's go to the lowest common denominator.

Make sure everyone makes a phone call, or comes in for a face-to-face visit. And, and, and that does not meet consumer expectations. They, they can so easily. Transact and, and their consumer life against every other element of, of life digitally. But in healthcare it sort of hits, it hits this analog experience level.

But, you know, that's changing and, and it, and it transacts with booking an appointment. You know, I mean, I think almost in most scenarios now, you can book appointments with . Digitally, but, but maybe not that specialist referral that has to be a phone call that, that, you know, transacts with that. And then all the way through to the patient experience and whether it's done telehealth or virtually and, and then the resulting, you know, care protocol and, and treatment and whether or not the, the person felt that they had a successful outcome.

When you look at that whole, like transaction experience, compare that with like, say Uber. The magic of Uber is press a button, phone shows up, you leave and, and you don't have to give cash or pay a credit card or, you know, deal with that. Like, you know, two minute delay climbing out the tax while you're taxi, while you're in a rush to go do something.

So, but, but the ride itself is kind of hit or miss. You know, am I gonna wanna talk to the driver? You know, am I gonna trust the driver? Is the car gonna be clean? You know, especially in this kind of covid pandemic, who was in it before? Is my mask safe? All that level of like, you know, uncertainty. Compare that with the patient experience here.

The pain in parking and navigating through the walls of a hospital system and just getting there in the waiting room and lobby your little 15 minute window with that hospital system. You know, the, with the doctor, with the nurse. That's magical. Everyone loves it and says, oh, I had a great visit with my doctor, but boy, it's such a pain on the front end to book and transact and, and get to that appointment.

And then upon leaving like you're handed a, you know, brochure full of papers or go here to get that or make this phone call to follow up on that front, or it, it just, it's an opposite end of the experience spectrum and, and what healthcare needs to do is solve that magical middle. And, and the bookends to create a, you know, seamless consumer friendly experience to that patient care.

Yeah, it's, it's, it's interesting when I talked to some people that talk, talked to me about they were implementing wayfinding to make it easier to go through, I'm like, well, you know, step back one step from that and figure out a way to make it so easy that they don't need way finding and Well, you know, I mean, do.

They were putting Epic in. He goes, why putting Epic in? And it was a health system executive who was asking him the question and he said, you know, do you think you're gonna be able to compete with health systems? And he said, yeah, I absolutely think we're gonna be able to compete for some services with health systems.

He said, well, why do you think that He goes, parking . That was, that was, that was the answer. Yeah, that's, that's true. I mean, that was one of the, I mean, parking is one of the biggest complaints of, of going into a, a health system. The campus is big. It's hard to find where you need to go. Yeah. And, and, and that just devolves even further to just convenience and, and, and convenience spans a whole range of, of activity and, and interactions.

So are health systems gonna be able to start to really differentiate? With each other, against each other potentially, and differentiating their communities based on a, a set of digital tools. Well, I, I don't know if the question so much. Is health systems differentiating against each other or against the new entrants and, and new competitors?

Yeah, that's probably a better question. And, and you know, there's gonna continue to be consolidation in the US provider industry. I think, you know, and, and rightfully so. You don't want too much density in a single market, et cetera. But, I mean, take a look at, you know, the two biggest systems, you know, not-for-Profit, Providence and Ascension.

Both probably do 25 billion a year in revenue. What did United Optum do? 250 billion NA National Scale, 10 x the revenue. Frankly 10 x the profit probably. So they can just reinvest in these convenience, these digital platforms, these, you know, behavioral elements. And so I, I think that's the, that's the differentiation that hospital systems are going to have to do is how do I remain.

Viable and not, not viable. I mean, there're always gonna be entities, the acuity, the ed, you know, infrastructure and, and you know that that element but is a lot of the low acuity and chronic care are gonna get siphoned off to these more virtual solutions and, and payer kind of directed solutions. And, and with payers even kind of building a lot of, you know, clinics, they don't have to do the high acuity surgery centers.

They, they can just focus on the chronic care, which is the bulk of the cost in, in the country. And if they're, you know, so, so acutely managing steerage on that front, the unnecessary surgical procedures and, and you know, the MSK before the spine, you know, surgery, you know, kind of, you know. Remediation, those types of opportunities will, will certainly hurt the finances of hospital systems.

So if I were hospital systems, I don't know that I'd be looking at my, you know, neighbor across the across town as being my competitor. I'd be thinking, you know, 5, 10, 10 years down the line, how am I more effectively competing against these payers and new entrants to have, have skin in the game and, and, you know, maintain that patient relationship.

And as we just discussed earlier, I think there's gonna be a. 60, 40, 60% still gonna be the, the in in-person, you know, care and 40% is gonna go virtual. And if you use those numbers, the hybrid model wins. But, but you have to have the seamless experience that bridges between telehealth is appropriate for X, Y, z.

You know, I'll go in face-to-face for this procedure or you know, this annual wellness visit or, or whatnot. But, but if you can't seamlessly intermingle those two different dimensions for, for ease of. You know, consumer and patient convenience, you're gonna, you're gonna risk losing all of them. Yeah. Well, Mike, let's, let's talk Zel for a little bit.

My understanding, digital prescription platform for integrating digital solutions into treatment plans. Is that, is, is that still where it's at? Or, or give us, give us an idea of, of what you do for payers and providers. Yeah, so we're a platform that lets clinicians prescribe digital health tools to patients.

We engage the patients typically under the hospital systems patient portal, so it's all white labeled to the hospital system and the, and or the doctor themselves. And then, because it's all digital, we track whether the patient. Used is using, you know, device data, remote patient monitoring. So we've integrated over 40 different vendors on behalf of our hospital systems.

Patient ed articles, videos, apps, maternity care, diabetes management, behavioral health, pre-op surgical pathways. Op PT, rehab, SK solutions. We've done a number of device integrations, CA devices, continuous glucose monitoring, RPM solutions, uh, covid specific, and then more generically services we've done.

Pre-surgical product fulfillment. We've done meal deli, several different meal delivery services. We did Kroger quarantine kits, uh, for covid positive or suspected patients. We've done Lyft rides for patients, Amazon product recommendations, so our platform's pretty broad and that whatever the clinicians think can be digitally facilitated to improve that patient care or

Or ease of experience, we can put it into our prescribing. And, and then engagement, you know, workflow, what certainly kicked up post covid is the degree of RPM associated with that and, and the heightened need for that to make telehealth visits more appropriate and applicable and even be able to bill for, because of the device requirements against some of the RPM code bill billing.

All right. This is the part where I ask very basic questions, not 'cause I don't know some of these answers, but just to get, get into the, the meat of it. So if, if a, how a physician interacts with this is generally through the EHR interface. They'll go in there and just like they're prescribing a medication, they'll prescribe a device, a glucose monitor.

Is that, is that pretty accurate an idea of how the physician interacts with idea how? Yeah, so, so on the physician side, the analog is 10 years ago, physicians did to hand write on a piece of paper and hand a piece of paper to a patient and, and the, they take that to a pharmacy and then, uh, a company Surescripts came along.

And the ACA is sort of mandated usage of that. So now, 90 plus percent of all medications get e-prescribed via Surescripts to the pharmacy of your choice. So think of us as the surescripts of digital health, a clinician. We're clinical decision support. We take a look at in real time basis, the patient's vitals, clinicals, diagnoses, you know, insurance, eligibility age, gender, et cetera.

And we use all that data to filter what digital tool is most appropriate to address that patient care. And the clinician can click a button. Doctor, nurse Ma, we can have rule configurations that require the doctor to do it. You know, akin to prescribing a med. Or can let anyone do it. We can also automate it.

So if you have enough confidence with what you wanna do against a conditional match. Just automate the enrollment to that patient. And we do that against pre-surgical prep, pre-appointment prep, pre-consult, shared decision making, post discharge and enrollment in A-P-T-O-T rehab program or, uh, product recommendations in the, in the recovery against that surgical procedure, whatever.

So 90% of the prescribed activity we do is on some automation routine versus a clinician clicking a button. In maternity care, we automate enrollment in in maternity care app to all moms over the age 18, but if under the age 18, it's a subjective decision by the clinician to click that button or not, depending upon the circumstances.

So we've got that flexibility. On the patient experience side, we send emails and SMS to the patient message from your doctor branded to the hospital system. It's that message from your doctor. We typically get 60 to 80% open rates on the material we send to patients. In some cases even higher. No direct mail campaign from any consumer company, insurance company, and anything else.

We'll get that level of, of, of usage because it's coming from your doctor and it's teed up against a face-to-face encounter you just had, or you're prepping from an appointment or you just left . Uh, a surgery or an appointment. So it's just kind of immediacy and timely against the patient mindset that they're coming in for some care, treatment and, and recommendations against that.

So, email, SMS, we can force the patient to log into their patient portal, uh, web, mobile, or we can bypass that with a more simple date of birth configuration. Authentication for the patient and then their click to download, click to register, click to buy, click to watch, click to answer. It's whatever that third party solution is providing is, depends upon the level of patient experience and and engaging with that app content, you know, article, video, et cetera.

But again, since everything's digital, we API integrate to all these third parties and then back in the EHR. We monitor the patient usage of that app or device or program and bring that data in real time for clinicians to make care assessments. And we've got a number of alerting mechanisms to trigger alert notifications when patient is non-compliant, or device or app.

Data is falling outside of threshold ranges. Or, or, you know, it's a necessary step in the completion of the next step in a routine IE consent form or shared decision making or something else. So we just closed loop that whole experience level. And I'd say over time we hope to be the, uh, benchmarking digital health effectiveness in the us.

We're working with the largest IDNs in the country and . We've integrated, you know, again, 40 plus different vendor solutions and we're seeing the efficacy of engagement levels and, and ultimately trying to marry it up telcom levels so that we think we'll have the segmentation of knowing what apps and tools produce the best results against patient segmentation.

And, and so much of this is folks focused on chronic care management, and it's hard to, that's behavioral change. It's hard to imagine one size fits all at addressing patient care and, and that something that works for a 70 year old Hispanic ma. You know, grandmother might not work for that. 17 year old kid going through teen angst and, and measuring some level of, um, you know, care treatment.

There's gonna be different tones, different voices, different segmentation of telehealth specialists supporting, you know, that, that certain disease state. And we think we're gonna be in the position of being the, the quantitative aggregator of all that data. So you're really a pla I mean, we use, we overuse this word, but uh.

Digital, digital transformation, uh, is too much of a buzzword, I would say the, uh, delivery of, of digital health through existing IDNs that have very traditional models. But once the platform's in play, they can then look at their workflows, they can then look at their, their care plans and whatnot. The digital components, you guys just sit there and help them to just integrate those, those things and, and really, I mean, help them to, to make that leap into, uh, a digital future for healthcare.

Is that, is that closer to what you guys are doing? Yeah, and, and back to that Surescripts analogy, they have 90% market share of EHR. I mean, they're ubiquitous at e-prescribing meds. We want to be ubiquitous at e-prescribing digital. Tools and digital apps and devices and, and, and I think that manifested itself, you know, one, one of the, the positive or to, to our business, Cerner invested in us a few months ago and are reselling us to their provider base.

So they, they're essentially chose us as their default platform for being . Digital digitally enabling all of their provider systems. And we're already working with, I dunno, 13 of the largest epic systems. Prov, Providence, UPMC, mass Gen, Brigham Advocate, Aurora, duke, atrium, Baylor, Scott White, Allina, Memorial Care, atrium, et cetera.

So we, we think we're. Working our way towards that ubiquity level, and, and, and we're building the two-sided marketplace. We add all these large provider systems. They tell all these vendors to integrate to our platform, and, and then we've built this two-sided marketplace of provider distribution and. And the cross cross platform enablement.

A vendor does a single integration to us, and then we can span them to both Cerner and Epic deployments. And we've got other EHRs on, on the roadmap in the future as well. So talk about the, talk about the buying decision, uh, specifically for healthcare providers at this point. What's the, what's the progression that they usually follow to get to a self implementation?

Well, you know, selling to hospital systems, it depends on who's got the budget and got the, you know, the, the clout. But you know, as we've just been discussing at a platform level, we need a clinical champion. We need doctors, nurses, MAs saying, I need to digitally engage my pregnant patients, my surgical patients, my diabetic patients, my behavioral health needs.

You need the clinical champion saying, I want to digitally engage my patients in x. You need the CIO that our, our aggregation strategy, our our IT scalability, the IT security framework that is gonna provide an ROI cost savings versus them trying to do it themselves. And then increasingly at hospital systems, you've got a chief digital officer or patient experience population health.

They care about adherence and engagement and RPM. So that if they're earning the capitation risk, they, they can effectively monitor the, the patients. So we need to convince that that swath of, of executives at a provider system, that our platform has benefits. And, you know, our budget almost always comes from the CIO.

But in some cases, the CIO is also the chief digital Officer and the innovation lead and chartered with digital transformation. And in other cases there's a chief medical officer who's on the front of the transformation experience. In other cases, it's the chief digital officer and innovation. That oftentimes, you know, coincides with, with investment, you know, kind of leaning out into the market.

And six of our large hospital systems have also chosen to invest in z Providence, UPMC, Cleveland Clinic, atrium, et cetera. Wow. So, uh, I, I'm, I'm curious though, I mean, 'cause you, you guys have been around now for, for a little bit. I mean, in, in, uh, startup years, you're, you're well past your teen years. The, you know, gimme an idea.

Does, does the sales process change? I mean, early on you, you talked about incubation and, and that was probably very focused on a, a set of use cases that you were working with, with, with Providence, and then you go out to market and there's probably a, a different kind of sales phase and, and then you start to scale it.

It, I, I would assume that there's sales looks a little different as, as you progress, but I, I could be wrong. What's what? What does sales look like? Well there, there's pre covid and post covid and um, sure. And, and you know, where, where systems are leaning into a more expansive future, like to, to better compete and, and, you know, they, they assume they're gonna be the consolidators of, of other systems in the market.

And then you've got systems that are, and, and retreat against their, you know, you know, financial impact and, and how are they gonna. How are they gonna out-compete, you know, the, the new entrant. So, you know, there's a classic innovator's dilemma. Can hospital systems afford to invest in a digital health future or can they afford not to?

And, and some are making that decision. And we'll see how that plays out in the competitive dynamics. In know, in the coming years, it's, it's been a huge boon for our business in, in that we literally a hundred x the volume of prescribed activity during covid. And the, the level of the digital engagement.

And part of that was just the, it was the only way to engage patients. So it's several systems. Were reaching a hundred percent of the patient populations against education on how to do telehealth, prep education around covid safety and protocols, or a hundred percent of. Pre-surgical patients got got reached with covid safety protocols and awareness and, and pre-surgical product kit fulfillment, et cetera, to, to incent all the elective surgeries back to back to the, you know, and again, safety protocols.

So as we go forward in the future, I don't know that hospital systems can ignore digital any, any longer, but you are finding that, and, and this is probably my big lament in the market here. You know, we talked about Livongo and $18 billion valuation and, and the MSK solutions and the behavioral health solutions and, and that massive, massive rise against all that.

Most of those solutions in chronic care have been targeted at payer and employer. And that valuation escalation has been focused on those distribution channels, not provider distribution channels, and, and providers need to step up their game and both capitation, exposure and risk, as well as digital enablement of convenience and options.

Otherwise, they're gonna risk, you know, losing that new front door strategy. But it's been a, a massive boon in success for Zel in how we're interacting with existing customers and the large IDNs that, that are coming to the, to bear. Our smallest customer, I think, does two and a half billion in revenues.

So we're mostly targeted the large tier IDNs. And, and then it's gonna be a question of how are the mid-size systems going to adopt a digital engagement future? And, and we've got some strategies, especially in in . Line with Cerner reselling Zel that are gonna address that market, I'd say. Interesting. Well, I've, I've got really two questions to close.

One is just another way of trying to have this discussion of, of, of the future and then the other sort of catchall. But let's just start with the, the future, which you just brought up. Let's, let's try to paint a picture of, you know, really what the consumer experience will look like in 2025 in healthcare, given what we know about the impact of the pandemic.

The investment dollars rolling into digital health startups, the role of big tech, the, the pace of technology change in healthcare. What might the consumer experience look?

There's certainly gonna be more proactive care delivered regardless. Hos, you know, the payers own the insurance. They, they own the risk mitigation, which is proactively engaging with patients before they start, you know, reaching a level where they have to go to ED visits or. I, I don't know, in injured things that could have been dealt with on A-P-T-O-T, you know, results in surgery because of lack of, you know, intervention, et cetera.

And, and I think with the rise of RPM, be it, you know, your Fitbits, your Apple watches, your in-home sensors. Along with the rise of RPM kits that manage CHF or, you know, recovery or more high acuity levels and, and all the monitoring against that is going to lead to signals that, that provide more proactive intervention and, and the payers have been capitated the insurance.

Most, most employers are capitated against our members, so they want to pay for all this hospital systems because they lost such large chunks of procedural revenue this year. Are now trying to aggressively move into the the capitation risk management. And so they themselves are gonna have to get into this more, more proactive.

It's gonna take longer for them to adjust their business model, I'd say, but, but I think that is an absolute and. Some people might see that as an intrusion of their privacy and you know, over my dead body, nothing's tracking me, et cetera. But I think there's gonna be financial and business models and incentives that for the majority of Americans, they're gonna say, I.

Yep. You can monitor, you can reach out to me, you can try to intervene with my care because it's cost effective and worthwhile to me against these high deductible plans or, you know, kind of other out-of-pocket expense, you know, considerations. So I, I think that's probably where things are going. And, and don't discount Amazon's rise.

I mean, I think even just this week they announced, or there's rumors that they're now licensed to operate their Amazon cares, their, their virtual primary care and, and their nurse care delivery in home in all 50 states. And I'm fairly convinced that Amazon's gonna eventually get in the insurance game.

And, and provide all those economic incentives and proactive measurements and and di device accompaniments. And they're gonna have a financial business model that most people like we've done with most of our consumer lives. I'm willing to give up a degree of my privacy. I. You know, be it Facebook or Google or whatever other big tech, you know, kind of mechanism we use for free because of the convenience and cost savings that, that benefits me and, and I think Amazon's gonna crack that nut pretty wide scale here over the coming years.

What's your take? I, that's interesting. I wrote an article. Uh, a little over three and a half, four years ago that said, the next move for Amazon is to, uh, essentially what they built out, which is Amazon care for employers and then get into the insurance game. So, I agree with you a thousand percent on that.

The, the announcement I read last week is that they, they have licenses in 19 additional states, and they are going to expand. I think they, you know. What, what does it really look like for Amazon to be in care? And I said, well, you know, think about it from vaccine distribution standpoint. If they'd given a hundred percent of the vaccine to Amazon, how efficient do you think that would've been?

I mean, my guess is they would've had people come to your door and vaccinate your entire family and they would've just knocked it off by zip code and you. Completely different experience because they have a ton of information. They have the logistics capability. You know, they, they could have handled the, the, the deep freeze for Pfizer, the, the moderate freeze for Moderna and the, uh, distribution of j and j and I, it just would've been very different.

And I think between now and 2025, that is, that's gonna be one of the big. Cs and Uhum are gonna be another impact that you're gonna care get pulled away from providers, in which case the activities of the consumer starts to get, you know, directed by someone else, someone else with a different set of interests.

And, and essentially, it's funny 'cause I say CVS and, and Optum and people are like, oh, they're two totally different companies. Well, they're not. They're the largest payers in the country who have significant, uh, presence in, in terms of primary care and directing care. And that's, that's where they want get digital care platform.

And. Whatnot, but the show is about you. I, I mean, if people, people, people, I mean, to, to go one step further on that, you know, we're I, I'm in Seattle, you know, think Providence is headquartered in Seattle and in this market, Optum bought several large clinics. So they're vertically stocked up. You've got Kaiser here, and now you have Amazon telling all hundred thousand of their employees independents in this region to start with their primary care experience.

So. Gain of any of those three new entrants towards market share utilization or, you know, ver. Becomes a net loss for Providence and, and to the blues here. So they're gonna have to become bedfellows to more effectively compete against the verticalization of, of those services. So I think you're gonna start, start to see a number of like different partnerships and entities and payvider kind of collaborations.

'cause it's all gonna be about scale and, and, and these individual hospital systems with their geographic monopolies or, you know, strong positions don't. That that's great for surgery and you know, the a hundred mile radius of, you know, high acuity care treatment. But, but you know, things that can be done in, in lower cost settings or virtually, they're gonna have a hard time stacking up a digital platform that, that meets the patient expectations against more convenience options.

And at the end of the day, convenience always wins. Yeah. You know, the other thing I'm looking forward to Mike, and I think it's right around is, is insurance products. That feel like they give me more choice, right? So I'm sign, I, I will sign up for a digital first insurance product if somebody comes out with it and offers it to me.

Right? So if they say, haven't, haven't, some of the payers come out with these like virtual first insurance plans and Yeah, and, and we have that now. We have a, we have a virtual, all your primary care begins with a virtual visit. As far as it goes right now, but I think where it goes next is okay. You know, even, even larger than that, it it, it, it elevates above the geography and they say, look, here's what we're gonna do.

And it's, it's what Walmart and others have done. Right. So it's. It's, I, I'm a small business owner and they come to me and say, look, digital first, remote patient monitoring for your patients. We're gonna do a, you know, a, an employer type program for fitness and, and wellness and, and behavioral health. And oh, by the way, if you have a cancer diagnosis or something to that effect, you can get care at Mayo or at fill in the blank.

And, and essentially what they do is they stitch together, you know, the, the programs that are the best in the country that I'm able to offer to my employees. That essentially, because I'm, I'm saving money here, I can make it up with maybe a higher level of service, uh, across the board in other areas. I, that's, I, I, I'm hopeful they get very creative with these new tools that they have available to them.

I mean, take a look at, you know, you've probably seen HIMSS and hers. And you know, it's a three-year-old company. I think they did two and a half tel million telehealth visits, which is in last year, which is most than more than most large hospital systems. And now, and they did a spac IPO, they were valued at, you know, one and a half billion or whatever, but they want to be the new front door for millennials.

And, and they, I think they bought a company that does in-home diagnostics and, and you know, blood draws and, and things like that where they'll send people, so they wanna be this closed loop, you know, and entirely virtual, entirely like patient oriented, you know, experience and convenience option on that front and.

That's what millennials are adopting. That's where they're all shifting their needs to. They don't have these, you know, long-term standing. You know, I, I must see my doctor face-to-face because that's what I've done for the last 50 years. And, and so new modalities are, are cropping up and, and certainly the, the convenience options gonna win out on large swats of consumer slash patient expectations here in the future.

Yeah. Well, all right, last question and, and, and I promise this is the last question. Okay. And I, I, I've started to close my interviews with this catchall and it's, it's really, it's produced some really great results and interesting conversations, and it is, is there a topic we haven't touched on that you think would be interesting for the community to hear about?

Well, so, you know, I've talked a lot about the payer, you know, dynamic of reimbursing against this chronic care management, and that's all commercially insured. Reimbursement. But if you're on CMS, Medicaid, Medicare, digital tools have not been reimbursed yet. And, and so arguably they, they have the most difficult time getting to that face-to-face doctor appointment.

Is that taking time off from work? Is that, you know, taking the bus to get there, is that the expense of getting there, parking or, or whatnot? Through all that, and. Why is it that commercially insured patients have all these great digital convenience options on managing patient care when, when Medicaid, you know, and and Medicare patients still have to go to that, you know, face-to-face visit and like, oh, I'm sorry, you're on Medicaid.

Book an appointment with my therapist. Yeah, we're kind of booked up. That'll be three months from now that you'll get some FaceTime with them. Good luck to you in the meantime. That's, that's not, you know, there's a health inequality that, that's kind of reached a, a level here that, that's been exposed that I think needs to, to get addressed.

And, and CMS needs to look long and hard at the efficacy and engagement and results of, of these digital solutions. They're proving the worth in, in the commercial market share and, and employer kind of world. , I think CMS needs to look at a reimbursement structure for those in, in the most acute need, you know, in, out in the Medicaid, Medicare world.

Well, during this emergency time though, aren't, aren't we reimbursing some of those things? Telehealth, but I don't, you know, we haven't seen that. You know, the, the Livongo's of the world, the behavioral health apps of the world, the models of the world are being covered at Medicaid, Medicare reimbursement levels.

That would, that would be an interesting, it's interesting as you were talking, you know, why do we focus on consumers commercial?

Just, yep, yep. The, uh, the economic, you know, incentives here, you know, geared towards the commercially insured because of the reimbursement rates attained from there. You, you're seeing huge drives for that to, you know, sort of put caps on, on that level, you know, against what Medicare, Medicaid, you know, kind of pricing, you know, billables are, et cetera.

But, we'll, we'll see how all that plays. But, but, but is the, is the answer more bu reimbursement, more government money. Is the answer to reduce the costs on the, and this is a, it's a different question, but reduce the costs on the, on the provider side to actually, you know, figure out a way to make money on Medicare reimbursement rates and, and Medicaid rates.

Because traditionally they haven't. I mean, if, if you, if you. Force caps on the provider systems, bundles, you know, some, some, you know, increased cap, you know, to what, what exer existing, you know, Medicare, Medicaid rates are. And, and if you required hospital systems to cost, contain against that commercial market share and, and bring all prices down in line.

Then they're gonna be forced to more digital automation. Every other industry has used digital enablement, you know, process automation, you know, you know, uh, software infrastructure to reduce costs. Hospital system, hasn't. They continue to add more bodies, more resources, more face-to-face exposure, which in itself is, is good for, you know, employment numbers, bad for the total economy and, and the cost of healthcare and, and it gets distributed unequally out to, you know, the patient population trying to manage their care against the costs.

Yep. Absolutely. Hey Mike, thanks. Thanks for your conversation and. No thanks Bill. I appreciate having me on and, and always great chatting with you. What a great discussion. If you know of someone that might benefit from our channel, from these kinds of discussions, please forward them a note. Perhaps your team, your staff.

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