The 41st annual J.P. Morgan Healthcare Conference continues for its second day at the Westin St. Francis hotel in San Francisco, where a veritable who’s who of the healthcare industry is gathered to talk pricing, patients, public policy and much more. Modern Healthcare will be providing live updates throughout the four-day event.
GE HealthCare's AI centered future: Day 2 at J.P. Morgan 2023 healthcare conference
Health Catalyst has pivoted its strategy as its health system customers focus less on long-term return on investment.
“We've needed to shift away from the parts of our portfolio that deliver a long-term, clinical improvement objective or long-term ROI, and focus much more specifically on near-term, hard-dollar financial improvements,” CEO Dan Burton said.
Anything that can’t help relieve financial pressures is off the table, CEO Dan Burton said. “We have to meet them where they are at,” he said. “They’re in a near-term hell.”
As part of it strategy, the healthcare data analytics and services company is expanding its outsourcing services relationships with health systems. In December, the company said it was partnering with Urbana, Illinois-based health system Carle Health to provide tech-enabled managed services in the areas of analytics, data management, reporting and project management.
The agreement also transfers employees of Carle Health’s clinical and business intelligence functions to Health Catalyst. Burton said it was a “kinder” version of outsourcing as the employees will stay local.
Health Catalyst will turn a profit this year, Burton said. The company’s goal is to generate a profit margin of 10% by 2025 through revenue streams such as outsourcing contracts and by cutting operating expenses, Chief Financial Officer Bryan Hunt said.
GE HealthCare is investing in artificial intelligence and connected devices to further embed its presence in the health system market, CEO Peter Arduini said.
The company, which spun off from General Electric on Jan. 4, is aiming to grow its AI and connected devices business, Arduini said. GE HealthCare’s biggest revenue generator is its legacy radiology and imaging equipment business, but the AI and connected devices segment is growing at a faster rate and creates recurring revenue, he said.
“This is a great business for driving cash,” Arduini said. “In the next couple of years, we won’t have any products coming out that don’t have embedded AI in them. It’s just the way things are going.”
Already, GE HealthCare has embedded AI into several applications and products, including new ultrasound and radiology devices.
“Machine learning is [being used] across the board,” Arduini said. “We want to index more towards the data because it is a great enabler for the company.”
While Arduini admitted inflation is affecting GE HealthCare’s bottom line, but said demand for its products remains strong. This is partially due to the backlog of procedures postponed during the first year of the COVID-19 pandemic, he said.
On Monday, GE HealthCare agreed to purchase Imactis, an advanced radiology equipment manufacturer. Arduini said the company will continue to be active in mergers and acquisition and will specifically seek digital ecosystem partnerships.
In advance of its fourth-quarter and full-year earnings report, GE HealthCare announced it generated $18.9 billion in revenue for 2022, a 4% increase. The imaging equipment business represented half of that revenue.
—Brock E.W. Turner
Clover Health expects to start the year with the same number of Medicare Advantage members as last year, the company disclosed in a news release ahead of its J.P. Morgan Healthcare Conference presentation Tuesday.
That means the insurance company likely lost a net of more than 8,000 Medicare Advantage customers during open enrollment for 2023. The insurtech reported 88,136 Medicare Advantage members as of Sept. 30, up from 80,283 at the beginning of last year.
“During the most recent Medicare Advantage enrollment period, we intentionally priced our insurance plans with profitability in mind as opposed to growth,” CEO Andrew Toy said in the news release. “Due to this strategic shift, we expect to start 2023 with insurance membership approximately in line with our insurance membership as of Jan. 1, 2022.”
Clover Health anticipates generating $1.2 billion in insurance revenue this year. The company aims to spend up to 91% of premiums on patient care, slightly higher than the 85% medical loss ratio required under federal law.
Toy also reiterated Clover Health’s plan to streamline its clinician partners for the Medicare Accountable Care Organization REACH program “in connection with an increased prioritization of profitability.”
Clover Health does not need to raise outside capital, Chief Financial Officer Scott Leffler said in the news release. “We also continue to feel comfortable with the company’s current liquidity position, which helps to insulate us against a challenging market environment,” he said.
In case you missed the conference's first day, here's a quick rundown of the highlights:
- Humana added at least 625,000 Medicare Advantage members during open enrollment this year, representing 13.6% year-over-year growth and far outpacing competitors, Chief Financial Officer Susan Diamond said.
- CommonSpirit Health is making progress on its performance improvement goals, pursuing $500 million in cost savings for fiscal year 2023.
- Oak Street Health, the Chicago-based primary-care provider for Medicare-aged patients, has big plans to open new clinics in 2023.
- Teladoc Health's CEO said the company is better prepared than rival telehealth providers to weather economic headwinds.
- Centene’s exchange business is surging while its Medicare Advantage sign-ups slowed during open enrollment for 2023, CEO Sarah London said.
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