Thinking Out Loud About A New Approach To Digital Health Innovation – PART 1

Note To Reader – As some of you know I recently left Health 2.0 after a great three year run. Over the last few weeks I’ve spent time reflecting on my experiences and thinking about the future of digital health. This piece, which has been broken into three posts, is a distillation of my thought process and culminates in an idea for advancing digital health innovation. Today I’m publishing Part 1, and will be publishing the other parts over the next few days. I appreciate your thoughts and suggestions on how to move forward, so please feel free to comment. Thanks for your time. JL

Digital Health Is Taking Off – Believe The Hype

It’s a very exciting time in the world of digital health (or “e-health” or “health tech” or whatever term you’d like to use).  Back in 2007 when my buddy Ed Shin (now CEO/founder of Quality Reviews) and I launched our online clinical trials matching company, Healogica, nobody seemed to care about technology-focused health companies.  In “those days” everybody was obsessing about “Web 2.0” companies and the big ideas of the day: social networking, social media, user-generated content, etc.  Digital health definitely wasn’t sexy.


Fast forward a few years, however, and it’s amazing how much the digital health industry has evolved.  Until recently, I was the Director/GM of the Health 2.0 Developer Challenge program, where I worked with large health stakeholders and digital health innovators to solve interesting problems using technology.  Over the course of three years, I watched interest in digital health EXPLODE with thousands of individuals and many-hundreds of companies creating new products and services to address a wide range of health care problems.

Major pieces of legislation like the ACA, ARRA-HITECH, and America Competes are creating many new opportunities in digital health that simply didn’t exist before.  The excitement around the space is palpable and highly reminiscent of the mood in the early internet days (depends on your perspective, of course, but I’m talking circa mid-nineties).

You Want Evidence?  I Got Your Evidence Right Here!

To understand how much has changed let’s take a look at investment in digital health companies.  MobiHealth News analyzed 10 years of publicly disclosed funding data (see graph below) for “patient-facing digital health companies”.  Their analysis showed that funding for digital health companies increased every year from 2002 to 2012 (except for a slight drop 2009), totalling $939 mm in 2012 (up from only $6mm in 2002).

While the Mobihealth data shows a funding dip in 2013, a report by RockHealth showed a 39% annual increase in venture funding for digital health companies in 2013 (totalling $1.97 B), and recently-released data from Q1 2014 show an 87% (!) year-over-year increase from Q1 2013.  Health 2.0, in a report using a more precise methodology to determine funding levels (they include venture funding, angel funding, and other sources), showed that funding for the digital health sector increased from $1.61 B in 2012 to $2.31 B in 2013, a year-over-year increase of 43%.  Bottom line – a lot of money is being invested in digital health now and that amount is growing steadily.


What’s even more encouraging is that investment in digital health is now being rewarded with meaningful exits.  In the last month we had TWO digital health IPOs: Castlight Health (CSLT), the SF-based health transparency company, and Everyday Health (EVDY), the NYC-based digital media and content company.  By going public, these companies have shown that it’s possible to build a significant digital health company AND achieve a significant exit, something that many investors have been dubious about for a long time. An increasing number of acquisitions of companies like MapMyFitness, Avado, and Bodymedia has also strengthened investor confidence.

There are a number of other really well-positioned companies out there like ZocDoc, PracticeFusion, and Vitals that could also IPO or be acquired soon, and it will be exciting to see where they end up.  I believe that success begets success and predict that the strong financial performance of digital health companies will continue to drive investment and growth in the space.

Meanwhile, Back In the “Real World” Of Health Care

Despite all the money invested, all the new companies formed, all the talented people who have come into this industry, and all the hype, the truth is that very little of the innovation that we are collectively building is making its way into the “real world” of hospitals, clinics, pharmacies, nursing homes and other places where health care is delivered.  Why does this matter?  Well, if you want to innovate and slow the relentless upward climb in health care costs you have to go, as Willy Sutton (might) say, “where the money is”.  Where the money is (see chart below) is in hospital care and professional services (almost 60% of total national health expenditures) – i.e. direct health delivery.


Ask yourself, however, what has changed at your local hospital or doctor’s office since the foundation of WebMD, the first big digital health company, back in 1996?  What percentage of doctor visits are booked online?  What percentage of prescriptions are filled online?  What percentage of provider-patient interactions happen virtually?  Ask yourself a similar set of questions about any other industry – banking, retail, entertainment – and you realize that the health system  you and I experience every day is still phenomenally ANALOG.

I will admit that there has been some progress made in the use of technology to deliver health care, particularly in the area of electronic health records (EHRs).  A recent study showed EHR adoption increasing year-over-year across all provider group sizes (small physician office, large physician office, and integrated health system), with the overall adoption rate in 2013 being 61% (vs. 50.3% in the prior year).  I think everyone would agree that the adoption and use of electronic health records is a good thing.

The cynic in me, however, would like to point out that the increased adoption of EHRs has been fueled by big-time government incentive programs that won’t go on forever.  The part of me that “keeps it real” would also like to point out that the incentives have driven the adoption of antiquated legacy EHR systems that primarily allow providers to bill more aggressively, and don’t really improve the quality of health or the health experience.

Aside from EHRs I’m sure that there has been some progress made in other places, but overall I think it’s safe to say that we’re not anywhere close to where we need to be.


Next Up: Thinking Out Loud About A New Approach To Digital Health Innovation – PART 2 (Coming Next Week). In the next post I’ll talk about the issues holding us back and how we addressed the innovation problem at Health 2.0.

Full House For NYCEDC Innovate Health Tech NYC Demo Day

Last night we hosted a TOTALLY full house (we got pictures to prove it!) for the NYCEDC Innovate Health Tech NYC Demo Day at the WeWork Lounge in SoHo. The 10 best teams from the competition got the opportunity to pitch their technologies live to a panel of health tech luminaries, who evaluated their entries on “potential for success”.  The judges deliberated live on-site and helped select our 3 winning teams:

Sincere congratulations goes out to our winners and all the teams that participated last night.  We’re creating a revolutionary health tech industry here in NYC and the entrants in this competition are building it through their outstanding contributions.

Finally, I’d like to thank the NYCEDC for creating this great program and Janssen Healthcare Innovation for sponsoring the challenge. Last, but not least, thanks to our judges and our partners at ChallengePost, and Startup Health for making this day a huge success.

Onword and upword for NYC Health Tech!

Hospital Pricing Data? More Please!

Anyone operating in the health tech universe for the last few years knows that open health data has been and continues to be a major theme. Current White House Chief Technology Officer Todd Park started talking (NO, YELLING!) about “data liberacion” back in 2010 when he was tapped to be CTO for the Department of Health and Human Services (HHS). Since then, Park and his HHS successor, Bryan Sivak, have moved heaven and earth to liberate huge amounts of valuable health data.

Health 2.0 startups have swarmed all over the data, using it to build ever more useful applications and tools. Data that was once siloed and accessible to only a few is now available to millions through online services like iTriage,, and Castlight Health. With each passing day, innovators figure out new ways to use and combine data sets in ways that no one in the federal government could have ever imagined.

In the last few weeks, however, the feds have upped the “data liberacion” ante, releasing a number of new datasets that could have a totally disruptive impact on the established health marketplace. On May 8th, the Centers for Medicare and Medicaid Services (CMS), released a dataset showing inpatient hospital charges to Medicare for 100 of the most common inpatient diagnosis codes. CMS followed up on its initial salvo on June 3rd, also releasing outpatient charge data for 30 of the most common ambulatory payment codes.

Why is this important? Prices charged to Medicare were formerly top-secret and closely guarded. Hospitals and health systems kept this information confidential because making it public could impact how they compete with other provider institutions and could also impact complex price negotiations with private third party insurers. The world has suddenly changed. Default price transparency is the new norm for providers working within the Medicare program (at least for the most common diagnoses), and we expect more transparency to come down the line from the feds and the states.

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Stupid Cancer Show – “Surviving Cancer: There’s An App For That?”

Thanks to my friend Matt Zachary, founder and CEO of Stupid Cancer, for the invite to the Stupid Cancer Show. Matt and his co-host/co-founder Kenny Kane interviewed me, Alex Fair of Medstartr/Health 2.0 NYC and Carly Parry of NCI, about the Crowds Care For Cancer Challenge.  We had a great discussion about how technology can help cancer survivors and how patients, providers and technologists can work together to build useful applications.  Interview begins at about 31:20.

Listen to internet radio with Stupid Cancer Show on BlogTalkRadio

Health Datapalooza IV Interview – June 4, 2013

In this quick interview with Health 2.0 Co-Founder, Matthew Holt, I talk about the Developer Challenge program, specific challenges launched/closed at the Health Datapalooza meeting, and innovation competitions more broadly. Thanks for the interview, Matthew!

Health Datapalooza 2013: “Challengeology” Panel

This year’s Health Datapalooza (the 4th annual) was bigger and better than ever, with over 2,000 registered attendees. Cristin Dorgelo of the White House OSTP led another great panel on “Challengeology” where we discussed prize competitions and lessons learned. Thanks to Cristin and the organizers of HDP IV for the invite!


  • Cristin Dorgelo, Assistant Director for Grand Challenges, White House Office of Science and Technology Policy (OSTP) – MODERATOR
  • Sara Holoubek, Founder & CEO, Luminary Labs
  • Jean-Luc Neptune, Senior Vice President, Health 2.0
  • Jonathan Gluck, Senior Executive & Corporate Counsel, Heritage Provider Network
  • Alex Fair, Co-Founder & Chief Executive Officer, MedStartr
  • Max Sow, Director, Business Intelligence, Surescripts

How Health Care Should Work: Direct-Pay For Well-Priced, High Quality Services

Ah, the dangers of ethnic food!   Last week I got a splinter deep in my right thumb while eating delicious souvlaki served on a wooden skewer. Despite my best efforts to get the splinter out I was unable to do so and had to deal with increasing pain and swelling while I was in Mountain View for the Health 2.0 Health:Refactored conference.

Yesterday, I realized the pain was getting worse and that I likely had an infection in the thumb so I decided to do something about it. For the last few years I have had a high-deductible health insurance plan (HDHP), which means I pay for all non-preventive services out of pocket until I hit my deductible of $2,850, at which point the “insurance” part of my plan kicks in to cover the costs.  Because I have a HDHP I am very interested in keeping my costs low, but I’m also concerned about getting good quality care and having a positive health experience.  As I searched for what to do I realized I had 3 options:

  1. Emergency Room
  2. Doctor’s Office
  3. Urgicare Center

As a physician trained in the great city of New York I knew that option #1 was a non-starter.  Going to St. Luke’s, Roosevelt or CPMC for a splinter would guarantee that I’d spend the whole day waiting as the overworked clinical staff dealt with patients with more severe and more pressing medical needs.  I also knew that the ER visit would almost certainly also unleash a maelstrom of medical bills after the visit, with none of the charges clearly representing the actual cost of care.  With regard to seeing my personal doctor (option #2) I realized that wasn’t an option either.  Although I very much like my personal physician and think he does an excellent job providing outpatient care, I know he doesn’t work most weekends and even if I got him on the phone he would have sent me to the local ER anyway.

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New York Academy of Sciences Conference: Health 2.0 – Digital Technology in Clinical Care

On March 22, 2013, the New York Academy of Sciences hosted the “Health 2.0: Digital Technology in Clinical Care” conference (sponsored by the New York State Department of Health AIDS Institute and the Josiah Macy Jr. Foundation). Participants convened at the Academy to discuss the technical, legal, and ethical implications of health care technology innovation. The audio below is from a conversation I moderated called “Promoting Translation and Expanded Use of Digital Technology”, featuring Dr. Jessica Ancker and Dr. Roberto Martinez.

Sensor Technologies: The Future of Health? @SXSW13

At this year’s SXSW we got the opportunity to organize a panel titled “Sensor Technologies: The Future of Health?” and enjoyed an excellent discussion with David Van Sickle of Asthmapolis, Lama Nachman of Intel, and Mark Winter of the XPRIZE Foundation.  Thanks to Hugh Forrest (@Hugh_W_Forrest) of SXSW for the opportunity – we hope to be back again next year.

Health 2.0 Spring Fling – Interview With Farzad Mostashari

At the Health 2.0 Spring Fling 2012 I had the opportunity to interview the ever-engaging Farzad Mostashari, our National Coordinator for Health IT. Farzad and I talked about a range of topics including his priorities at the ONC (Office of the National Coordinator), the Investing in Innovation (i2) Initiative, ongoing challenges, and what members of the audience can do to help drive innovation in the space.