Walmart Calls It Quits, Google's Med-Gemini Solves Medicine, and Value-Based Care University is Here!

Thank you for reading NewHealthcare Platforms' newsletter. With a massive value-based transformation of the healthcare industry underway, this newsletter will focus on its impact on the medical device industry reflected in the rise of value-based medical technologies, and platform business models that are significantly transforming payer and provider healthcare organizations. I will occasionally share updates on our company's unique services to accelerate and de-risk the transition!

DISCLAIMER: This newsletter contains opinions and speculations and is based solely on public information. It should not be considered medical, business or investment advice. The banner and other images included in this newsletter are AI-generated and created for illustrative purposes only unless other source is provided. All brand names, logos, and trademarks are the property of their respective owners. At the time of publication of this newsletter, the author has no business relationships, affiliations, or conflicts of interest with any of the companies mentioned except as noted. ** OPINIONS ARE PERSONAL AND NOT THOSE OF ANY AFFILIATED ORGANIZATIONS!

Hello again friends and colleagues,

In this week's newsletter, we cover the huge announcement of Walmart exiting the healthcare provision space, and the more muted but likely more impactful announcement of the super-human capabilities of Google’s medical AI Med-Gemini. We start by examining the recent decision by Walmart to close its healthcare centers, which underscores the challenges faced by organizations looking to succeed in value-based care. Next, we introduce an exciting breakthrough in AI for healthcare - Med-Gemini, a family of highly capable multimodal AI models that have demonstrated remarkable performance across a wide range of medical tasks. We close this week’s newsletter with more information about NewHealthcare Platform’s recent announcement of Value-Based Care University, a comprehensive educational platform designed specifically to meet the need of provider organizations and medical technology companies transitioning to value-based care. Lots to cover to so let’s get started!

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Walmart Calls it Quits in Healthcare Delivery?

Walmart has announced its decision to close all 51 of its health centers across five states and shut down its virtual care offering, Walmart Health Virtual Care, due to the lack of a sustainable business model. In a surprising announcement, given recent plans of doubling the number of centers, Walmart blamed the challenging reimbursement environment and escalating operating costs which have made the care business unsustainable at this time. The company stated that they will focus on ensuring a smooth transition for patients, associates, and providers, offering support and assistance throughout the process. Walmart confirmed they will continue to provide trusted health and wellness services through its nearly 4,600 pharmacies and more than 3,000 vision centers.

The only enduring business model of care provision is the health system model which aims to deliver the largest amount possible of the most expensive services and treatments to sick people and get paid for delivering those services. Pharmaceutical and medical device companies have historically enabled this model by creating the technologies and treatments needed to provide services. Health insurers collect premiums from the government or employers and charged to manage the provider networks and manage the payment transactions for the provided services. This model grew to $4.5 trillion or 20% of US GDP with an equally-sized amount of vested interests.

A new model, value-based care (VBC), is now in the early stages of evolution. VBC combines both insurance and care services provision, with incentives aligned to keep people healthy, improve their satisfaction with care, and lower overall costs. While organizations that figure out VBC stand to reap massive rewards, recent earnings reports and business announcements from companies like CVS (significant drop in earnings), Walgreens (closure of hundreds of VillageMD care locations), and now Walmart indicate that it is no easy task, even for the largest organizations.

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In my opinion, there are three must-haves for success in VBC which Walmart didn’t have and which contributed to their failure to develop a “viable business model”:?

1. Own both the payer and provider functions: Walmart outsourced payer functions to United Healthcare, which may have been a misstep. Owning both functions allows for better alignment of incentives and control over the entire patient journey. I wrote about the United/Walmart agreement in this newsletter almost two years ago and how it was not a positive for Walmart.

2. Focus on building a platform that stresses value-based medical technology solutions and mobile/retail/home platforms: Walmart’s emphasis on in-store visits so they can keep customers in stores may have limited their ability to optimize mobile and home-based care, which are critical for success in VBC.

3. Invest in upskilling the workforce for the new model: Transitioning to VBC requires a significant shift in mindset and skills for healthcare professionals. It is unclear how effectively Walmart addressed this aspect of the transformation.

Walmart's experience highlights the challenges and complexities of transitioning to a VBC model, even for a large and well-resourced organization. As VBC continues to evolve, it will be crucial for organizations to carefully consider their strategies and investments in order to be successful under the new model.

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Google’s Med-Gemini’s Super-Human Performance

The recent announcement of the highly anticipated Med-Gemini, a new family of AI models, revealed remarkable advancements in understanding and processing medical information. These models excel at a wide range of medical tasks, from answering complex medical questions to analyzing medical images, health records, and videos.

One of the key strengths of Med-Gemini is its ability to use web search to find relevant information and provide more accurate answers to medical questions. This has helped the model achieve top performance on popular medical question-answering tests, surpassing previous best models.?

Med-Gemini also demonstrates exceptional ability in understanding and integrating information from various medical data formats, such as images, waveforms, and text. It outperforms or matches the performance of other state-of-the-art models across many different medical benchmarks.

Impressively, Med-Gemini can process and analyze lengthy electronic health records (EHRs) and medical videos, a task that has been challenging for previous AI models. It shows potential in assisting with medical education, summarizing biomedical research, and understanding surgical procedure videos.

I expect Med-Gemini to continue the acceleration of AI integration into medical care. Med-Gemini has the potential to address some of the challenges the we mentioned above for VBC transformation:

1. Improved clinical decision support: Med-Gemini's advanced reasoning capabilities and ability to integrate web search could help provide more accurate and up-to-date clinical decision support to healthcare providers, potentially improving the quality of care and reducing costs associated with suboptimal treatment decisions.

2. Streamlined administrative tasks: The model's ability to process and summarize lengthy EHRs could help automate and streamline administrative tasks, such as generating patient summaries or identifying relevant information for coding and billing, thus reducing administrative burden and costs.

3. Enhanced patient engagement: Med-Gemini's multimodal understanding capabilities could be leveraged to develop more engaging and informative patient education materials, such as personalized treatment explanations or interactive symptom checkers, potentially improving patient understanding and adherence to treatment plans.

4. Predictive analytics for population health: By standardizing large volumes of EHR data, Med-Gemini could power advanced analytic models that help identify patients at risk of developing certain conditions or experiencing adverse events, enabling proactive interventions and potentially reducing healthcare utilization and costs in the long run.

While Med-Gemini alone may not completely solve the challenges faced by value-based organizations, integrating its capabilities into care delivery models could potentially help address some of the key issues, such as improving clinical decision-making, reducing administrative costs, enhancing patient engagement, and enabling proactive population health management.

Introducing Value-Based Care University: Up-skilling the Healthcare Workforce for Value-Based Care

The recent closure of Walmart's healthcare centers highlights the challenges faced by organizations looking to transition to value-based care (VBC). While Walmart's significant resources and scale were not enough to guarantee success, their experience provides valuable lessons for others embarking on this journey. To succeed in VBC, organizations must not only have the right technology and data analytics capabilities but also a workforce equipped with the knowledge and skills to thrive in this new paradigm.

This is where Value-Based Care University comes in. NewHealthcare Platforms has been working for months on creating a solution for the training needs for healthcare organizations transitioning to value-based care! VBC University is a comprehensive learning platform designed to up-skill the workforce of organizations transitioning to value-based care. The platform will offer a range of courses tailored to different roles within a VBC organization, from frontline providers and staff to executive leadership. VBC University optimally leverages artificial intelligence to accelerate content development and delivery to keep pace with the rapidly evolving landscape.

VBC University's courses will not only the different skills of value-based care delivery such as care coordination and population health but will also include courses on the design and implementation of value-based medical technology solutions, effective communication, teamwork, and change management, which are also needed for successful transition to the new care delivery model.

VBC University aims to empower healthcare organizations to successfully navigate the transition to value-based care. Whether paired with NewHealthcare Platforms' consulting services or used as a standalone workforce upskilling solution, VBC University is designed to be a critical tool for leaders of provider and medical technology organizations looking to drive VBC transformation initiatives. As the healthcare landscape continues to evolve, investing in the development of a skilled workforce and the adoption of innovative, value-based medical technology solutions will be key to thriving in the era of value-based care. We will soon launch the first two courses: Introduction to Value-Based Care and Introduction to Healthcare AI. Stay tuned for more announcement in this newsletter and message me if you would like to be one of the first to pilot the courses in your organizations. As a sample, here is the first lesson of the Introduction to VBC course. Thoughts and feedback greatly appreciated.

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See you next week,

Sam