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Mark Zuckerberg is selling up to $13 billion of Facebook stock to fund an ambitious project to end disease Print E-mail
Written by FHI's Week in Review   
Monday, 17 September 2018 17:31
A CNBC article published online 9.15.18 showcases some of the incredible things Facebook's founder and wife are doing with their spare cash.

The heightened focus on U.S. healthcare system's fundamental issue (too much money spent--almost 20% of GDP and growing-combined with mediocre outcomes- compared to other first world nations) is gathering momentum. Obamacare and the subsequent Repeal and Replace initiative by Republicans has shined a bright light on this dysfunctional industry.
Read more in the current issue of Week in Review>>
Last Updated on Monday, 15 October 2018 11:19
Update on Florida Workers’ Comp Print E-mail
Written by Tom Murphy | Danna-Gracey   
Wednesday, 12 September 2018 12:59
The Florida Department of Insurance, at the recommendation of the National Council on Compensation Insurance (NCCI), has approved and implemented a total of almost 12% in premium-rate decreases since January 1, 2018. In my recent conversations with a number of experts in the workers’ comp arena, it looks like there may be another rate decrease in 2019. For those of us in the industry this is welcome news for all businesses and medical practices in Florida. The reality is that the 2016 Florida Supreme Court decisions are impacting the workers’ comp system in ways that have not been realized by the carriers due to the nature of the system taking a few years to catch up to the impact of an increasing number of claims and higher payments to attorneys and injured workers.

The carriers and defense attorneys we work with have confirmed the increase in the claims they are receiving as well as the demand for benefits. These increases will ultimately lead to higher costs to the carriers and the overall system and will eventually show up in the form of rate increases for everyone buying coverage. These eventual rate increases will continue until the legislature decides to implement changes to counter the Florida Supreme Court decisions.

We also want to clear up some confusion about medical practices and small businesses that utilize PEOs or payroll companies. No practice or business is required to use a PEO or payroll company to service its workers’ comp coverage. You can remain with your workers’ comp insurance company and enjoy very beneficial dividend plans while having the same options, including “pay as you go” to simplify your premium payments. Some unscrupulous PEOs and payroll companies have been less than transparent with these details and want you to believe that the only way you can get a “pay as you go” option is to purchase their workers’ comp coverage, which is not true.
Contact Tom
Phone: 800.966.2120

Last Updated on Wednesday, 12 September 2018 13:23
Former 49ers Linebacker Dead by Suicide Print E-mail
Written by FHI's Week in Review   
Monday, 10 September 2018 15:37
Sports Illustrated reports on 9.7.18 that former 49ers linebacker Jason Hairston, 47, died on Wednesday; he took his own life. Hairston was a starting linebacker for the University of California, Davis in college before signing as a free agent with the San Francisco 49ers in 1995. He was traded to the Denver Broncos a year later and retired in 1996. Following his football career, Hairston founded hunting clothing company KUIU in 2010.
According to the article's author, Emily Caron:
In an interview in 2016 Hairston told CNBC that he was suffering from Chronic Traumatic Encephalopathy, or CTE, which is a degenerative brain disease found in athletes, military veterans, and others with a history of repetitive brain trauma.
Read more in the current issue of Week in Review>>
Last Updated on Wednesday, 12 September 2018 13:05
Are High Prices Testing Private Equity's Ability to Close Healthcare Deals? Print E-mail
Written by David H. Fater   
Thursday, 06 September 2018 11:37
Now that healthcare consumerism is replacing traditional retail storefronts with dental and urgent-care clinics, the sector has drawn ravenous interest from private equity funds. But are would-be buyers getting discouraged by increasingly high prices? In a recent survey of private equity funds and strategic buyers, the top challenge identified in completing healthcare mergers and acquisitions is a shortage of attractive targets. The biggest reason? The deals are getting too expensive.
Of the 579 deals for U.S. healthcare targets last year the median transaction value has increased substantially since 2015. It is what appears to be a perfect storm and the number of transactions was the second highest on record. The specific targets included healthcare providers like physician practices and health systems as well as healthcare IT companies and life sciences companies. This is a diverse mix of targets with each of them having their own unique valuation issues.

Health system deals tend to catch a lot of headlines primarily because of their size, but they actually represent a small proportion of overall healthcare acquisition transactions.  Midmarket transactions, especially among relatively small specialty practices, make up most of the deals taking place.

The problem is investment banks are overpricing the companies looking to sell, valuing them in some cases two or three points higher than just two years ago without much justification for it. It is an old story where companies that are essentially average in terms of their financial performance or operational capabilities are looking to demand a price that is in line with companies operating in the top quartile. Put differently, the sellers believe their streets are paved with gold rather than high class bricks.

Prices have risen on the provider side in a herd mentality because their peers are selling at premiums. Dental groups, for example, are attractive to private equity firms because insurers tend to reimburse them without much pushback, their patients return at regular intervals and their industry is fragmented, inviting firms to create services organizations to support them. It is the reason that physician practice management companies flourished in the late 1990’s and we all know where that ended up. However, it has not deterred private equity groups from looking at other specialty groups that have similar criteria such as dermatology, ophthalmology, plastic surgery and behavioral health.

Private equity's strong appetite for healthcare acquisitions was on full display in a recent regulatory filing that revealed nine such firms submitted offers to buy Nashville-based physician staffing company Envision Healthcare in February. In June, Envision announced private equity firm KKR would buy the company for $9.9 billion in cash and assumed debt. KKR submitted a bid for up to $46 per share, which came in less than other offers of up to $60 per share. We recently valued a specialty practice at $155 million and when the transaction closed it fetched very near that price.

As the acquisition trend plays out, a new difficulty for private equity is finding companies with the infrastructure to support the kind of growth they are targeting. Outside of hospitals and health insurers, the healthcare market is highly fragmented with many early stage companies. The targets tend to be one or two dominant players of size and then there is a significant drop-off in terms of size and sophistication.

Interestingly enough, 73% of respondents in a recent survey had walked away from a potential healthcare acquisition. The principal reason was what was discovered in extensive due diligence. Would-be acquirers walked away because of anticipated problems with reimbursement, technology integration and security and compliance. We have preached for years about the necessity of integrating the due diligence with the post-merger integration plan as the best way to determine if the deal is worth doing and at the target price.

A different firm’s view through the lens sees that 75% of what is out there still represent attractive targets. This is most evident in physical therapy, urgent care, dentistry and even veterinary practices. Bringing consumerism into the equation makes a transaction more attractive AND that is one of the things that is inherently wrong with our current healthcare system. The consumer is not really involved because of the way the system works. So, the more like a retail play the more attractive the business is.

Despite all of private equity's investment in specialty practices, several industry experts said firms haven't shown the same appetite for hospitals and health systems. Brick and mortar assets like hospitals are expensive, and the high degree of consolidation that has already taken place in the sector has made them even more so, not to mention buying health systems means improving patient care, paying for building upkeep and adding new technology. Also, the rapidly growing trend is to push more services out of the hospital and into free standing facilities which can help drive down cost to the system.

We believe the acquisition binge will continue for a period of time despite the valuation questions. There is value in scale in healthcare, especially in negotiating insurance contracts or directly contracting with large employers. As long as the economy continues to hum, deals will get done until the contraction takes place or the valuations become too high even for the private equity players

To explore ways in which we can provide assistance in assisting with your merger and acquisition activity, including valuation, in this evolving health care environment, please contact David H. Fater at or Richard M. Cohen at

Last Updated on Thursday, 06 September 2018 12:41
Novel Strategy Shows Promise for Earlier Detection of Alzheimer’s Disease Print E-mail
Written by FHInews   
Thursday, 06 September 2018 00:00
Finding an effective way to identify people with mild cognitive impairment who are most likely to go on to develop Alzheimer’s disease has eluded researchers for years. But now, a team of researchers led by David Loewenstein, PhD, director of the Center for Cognitive Neuroscience and Aging (CNSA) and professor of psychiatry and behavioral sciences at the University of Miami Miller School of Medicine, has devised a novel strategy that could do just that.

The study, “Utilizing Semantic Intrusions to Identify Amyloid Positivity in Mild Cognitive Impairment,” funded by the National Institute on Aging, was published in the September issue of Neurology and earlier online.

Along with study co-author Rosie E. Curiel, PsyD, assistant professor of psychiatry and clinical neuropsychology, and their colleagues, Loewenstein studied 88 patients with amnestic mild cognitive impairment (aMCI). They identified 34 people in this cohort with underlying, prodromal Alzheimer’s disease (AD) by history and amyloid positive scans. Amyloid-beta is an abnormal protein in the brain long associated with the development of AD.

Among the 54 aMCI participants negative for amyloid-beta, 29 were classified as having a clinical course suggestive of AD but suspected non-AD pathology or “SNAP.” The remaining 25 amyloid negative patients had major depression, anxiety or other psychiatric disorders; cerebral infarctions; diffuse Lewy Body disease, or other non-AD neurologic conditions.

The investigators predicted those at greatest risk for AD using the Loewenstein-Acevedo Scales for Semantic Interference and Learning (LASSI-L), a tool developed at the University of Miami. The LASSI-L allowed researchers to uncover specific memory deficits that aligned with imaging findings for abnormal brain amyloid accumulation.

“Developing more sensitive and effective measures to tap the earliest Alzheimer’s changes in the brain is essential for providing earlier and more effective treatment, to better understand the neuropathology of the disease, and to monitor emerging interventions,” said Loewenstein.

The LASSI-L measure is a novel “cognitive stress test” validated in both English and Spanish. Researchers ask patients to read 15 words. The words come from three categories — fruits, musical instruments and articles of clothing — of five words each. They ask participant to repeat the list of words, and then cue their recall by category. A second trial repeats this learning task and the cued recall to strengthen their recall.

Next researchers present a list of 15 different words from the same three categories. The patients are asked to recall these new words as a measure of “proactive semantic interference” (PSI). PSI occurs where there is interference in new learning based on previous learning and correlates with risk of developing AD.

Researchers also present the second word list a second time, and repeat the cued recall. This component of the LASSI-L measures how well people can recover from the proactive semantic interference. It’s called failure to recover from PSI (frPSI) — and a second indicator of AD risk.

A major finding outlined in the Neurology paper was that the amyloid-beta imaging-positive patients committed a significantly higher number of semantic intrusion errors — specifically on the PSI and frPSI measures – compared to the SNAP and other non-AD patients.

Traditional cognitive measures to identify AD risk do not include PSI or frPSI, so the LASSI-L may represent a specific, non-invasive test that could successfully differentiate true AD from SNAP, the researchers noted.

“The association of the LASSI-L with amyloid positivity makes it useful in the clinical evaluation of preclinical Alzheimer’s disease and for appropriate recruitment for clinical and prevention trials,” Loewenstein said. “This also provides an effective and inexpensive way of screening at-risk populations.”

The research is ongoing. Curiel received a new federal grant to computerize the LASSI-L and other novel cognitive measures. In addition, current studies are underway to compare progression on the LASSI-L to brain biomarkers such as MRI, fMRI and PET scans, as well as new agents that assess pathology in the brain.

“We are assisting our national and international institutional partners in developing this cognitive stress test for their investigations and clinical practice,” Loewenstein said. “It is a goal of our Center for Cognitive Neurosciences and Aging and the University of Miami Miller School of Medicine to be at the forefront of these efforts.”
Last Updated on Friday, 07 September 2018 07:04
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