Jan 7, 2020

Axios Vitals

By Caitlin Owens
Caitlin Owens

Good morning. I could not be more thrilled to announce that this season of "The Bachelor" is off to a very strong start, and if you have any predictions as to who makes it far this season, send 'em my way.

  • Predictions do not equal spoilers. Please do not send those.

Today's word count is 811, or a ~3-minute read.

1 big thing: AI's strong start to 2020

Illustration: Sarah Grillo/Axios

Two new studies highlight artificial intelligence's potential to improve patient care, specifically by aiding or improving cancer detection.

Why it matters: AI could create enormous benefits for patients and the doctors who treat them, but some experts warn that the explosion of new health technology could put some patients in danger, as the LA Times and Kaiser Health News recently reported.

Driving the news: Brain surgeons are using AI and new imaging techniques to diagnose brain tumors just as accurately as human doctors, but much faster, according to a study released yesterday in Nature Medicine.

  • Just last week, Google's health research unit said — in Nature — that it has developed artificial intelligence technology that can detect breast cancer at least as well as radiologists, WSJ reports.

Yes, but: "Many health industry experts fear AI-based products won’t be able to match the hype.

  • "Some doctors and consumer advocates fear that the tech industry, which lives by the mantra 'fail fast and fix it later,' is putting patients at risk ― and that regulators aren’t doing enough to keep consumers safe," KHN's Liz Szabo writes.
  • For example, a widely used algorithm was proven to discriminate against minorities, and many new AI products are untested and unproven.

The bottom line: We've got a long way to go before AI lives up to its hype within the health care system.

Go deeper: Medical AI has a big data problem

2. Hospital charges spiked, especially in the ER
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Reproduced from Thomas M. Selden, 2019, "Differences Between Public and Private Hospital Payment Rates Narrowed"; Chart: Axios Visuals

The rates charged by hospitals — especially for emergency department care — have skyrocketed over the last two decades, according to a new study in Health Affairs.

Why it matters: While most patients with insurance don't pay these prices for their care — insurers typically negotiate lower rates — those who are uninsured or out-of-network often do.

Between the lines: The ER is a common source of surprise medical bills. It's no surprise that the issue has become more visible as out-of-network patients have received bills for increasingly eye-popping amounts.

Bonus: The same study found that the gap between what private insurers and the government pay hospitals narrowed between 2012 and 2016, after drastically widening between 2000 and 2012.

3. One Medical's growing reliance on hospitals

One Medical has filed paperwork to go public, and the growing chain of physician offices has made it clear to prospective investors that large, dominant hospital systems are becoming a lot more crucial to its business, Axios' Bob Herman reports.

The bottom line: "[O]ur growth depends on maintaining existing, and developing new, strategic affiliations with health network partners," One Medical executives wrote in their IPO filing.

How it works: One Medical, which preaches convenient and lower-cost primary care, earns money in three main ways.

  • Employers, most notably Google, pay a membership fee so their workers can have unlimited access to One Medical's clinics. Or, a membership on your own costs $199 annually.
  • Hospitals, large medical groups and employers pay fixed monthly rates for a certain population of people, and One Medical is responsible for that group's care.
  • Health insurers create traditional "fee-for-service" agreements where they pay One Medical for each service it provides.

Between the lines: Hospitals are essentially finding a new way to buy patient referrals. They pay fixed sums to One Medical, and patients who need more intensive and expensive care will go to those hospitals instead of competitors down the street.

  • But One Medical benefits, too. In some instances, instead of fixed rates, hospitals "extend their health insurance contracts to us," according to One Medical's filing.
  • One Medical partners with hospital systems that hold a lot of market or brand power, which allows One Medical to piggyback on those hospitals' lucrative contracts with insurers.
4. Complications can double childbirth cost
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Reproduced from Premier; Chart: Axios Visuals

Complications can nearly double the cost of delivering a baby, according an analysis from health care alliance company Premier.

Why it matters: Vaginal births with complications cost about 80% more, on average, than ones without complications, Axios' Marisa Fernandez writes.

  • Cesarean deliveries cost about double those with no complications. And more women are experiencing complications during labor — the rate rose by 36% from 2008 to 2018, per Premier.

A separate study, published Monday in Health Affairs, shows that out-of-pocket costs for maternity and childbirth care rose from $3,069 to $4,569 between 2008 and 2015 for women with employer-based insurance.

Go deeper: Medicaid expansion helps improve infant mortality rates

5. Controversial antidepressant isn't widely used

President Trump said that he'd directed the Veterans Affairs system to buy "a lot" of a new antidepressant, but so far the agency has treated only 15 veterans with it, STAT reports.

The intrigue: The drug — Spravato, a nasal spray developed by Janssen — has been cautiously rolled out, partially because of questions surrounding the data used for the drug's approval and, thus, its effectiveness.

  • The VA's medical advisory board declined to approve coverage of Spravato for all veterans over the summer, and restricted its use to limited scenarios.
  • The drug's rollout in private clinics and hospitals has also been slow, as providers have struggled to get preauthorization from insurers to administer the drug or reimbursement for monitoring patients after they take it.

The bottom line: Although Trump touted the drug as having "incredible" results, it's available in only seven VA facilities out of 1,200.

Go deeper: Concerns mount over depression drug Spravato as VA approval looms

Caitlin Owens