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Health Management Technology News
  February 13, 2014
In this issue:

 Comcast set to acquire Time Warner Cable for $45 billion

 King, Fischer Introduce Legislation to Protect Jobs, Prevent Overregulation in Growing Health IT Industry

 Lenovo sales hit $10.8 billion as company eyes smartphone biz

 Health insurance enrollment on target in January

Comcast set to acquire Time Warner Cable for $45 billion

Comcast announced on Thursday an agreement to acquire Time Warner Cable for more than $45 billion in stock, a deal that would combine the biggest and second-biggest cable television operators in the country.

For Comcast, which completed its acquisition of NBC Universal, the television and movie powerhouse, from General Electric less than a year ago, the latest deal would be its second big act to radically reshape the media landscape in the United States. And the merger is almost certain to bring to an end a protracted takeover battle that Charter Communications has been waging for Time Warner Cable.

Brian L. Roberts, the chief executive of Comcast, said in a statement on Thursday that Time Warner Cable’s executives “have created a pure-play cable company that, combined with Comcast, has the foundation for future growth.”

For Time Warner Cable, the deal provides a neat solution to its problems. It will receive just about the $160-a-share price it said was its true value, and possibly more. It will no longer have to slog ahead with a turnaround plan being run by a new chief executive, Rob Marcus. And it will allow it to become part of the company that is already the dominant force in cable television services.

Despite combining the two largest cable operators in the country, a merger may have little impact on consumers. Comcast and Time Warner Cable compete in very few markets. As a result, few consumers will see their choices of cable operators reduced.

Nonetheless, regulators will surely look carefully at the impact on the deal to consumers, and may also focus on whether the combined company will have additional power in negotiations with cable networks, a recent source of tension in the industry. The two companies said they expected the deal to close by the end of the year.

Comcast has about 22 million television customers, according to the National Cable and Telecommunications Association. Time Warner Cable has about 11 million video subscribers, according to people familiar with the company.

In a bid to appease antitrust regulators, Comcast is expected say it is willing to divest three million of Time Warner Cable’s roughly 11 million pay television subscribers.

It was not immediately clear if Comcast would propose certain markets to divest, but shedding those subscribers should keep Comcast with less than 30 percent national market share for pay television, a level the company believes will satisfy antitrust regulators.

Under the terms of the deal, Time Warner Cable shareholders will receive 2.875 shares of newly issued Comcast common stock for each of their shares, people briefed on the matter said on Wednesday evening. Based on Comcast’s closing price of $55.24 on Wednesday, that values each Time Warner Cable share at about $158.82 each.

If Comcast stock rises on news of the deal, the price could go up, while if the stock falls, it could go down.

The deal is subject to approval by both shareholders of both companies. Because it is an all-stock deal with newly issued shares, Comcast will not have to take on any new debt.

Should a deal be completed, Time Warner Cable shareholders will own roughly 23 percent of the combined company.

Read the full New York Times article here

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King, Fischer Introduce Legislation to Protect Jobs, Prevent Overregulation in Growing Health IT Industry

U.S. Senators Deb Fischer (R-Neb.) and Angus King (I-Maine) announced today that they have introduced legislation to protect jobs, reduce regulatory burdens, and provide greater certainty for health information technologies (health IT). The Preventing Regulatory Overreach To Enhance Care Technology (PROTECT) Act of 2014 offers a more specific regulatory framework for health IT that promotes innovation and job creation while protecting patient safety.

“Not only is Health IT one of the most innovative and rapidly growing fields of technology in the country, but it’s also fundamentally transforming the way we think about health care,” said King. “As these technologies develop, it’s critical to implement a clear, risk-based framework that would protect patient health and ensure that FDA rules are appropriately targeted to support and not stifle innovation. The PROTECT Act would provide important regulatory clarity that will safeguard patient safety, make the health care sector more efficient, and allow businesses across Maine and the nation to continue developing groundbreaking ideas. Having a well-defined, risk-based framework will serve to promote the continued success of health IT, and I’m pleased to join Senator Fischer in introducing this bill.”

“Federal overregulation is one of the key challenges holding back entrepreneurs and job creators in Nebraska and across the country,” said Fischer. “While economic growth remains sluggish, it’s critical we prevent these costly and time-consuming bureaucratic hurdles from hurting one of the fastest growing sectors of our economy – technology. The PROTECT Act increases regulatory efficiency over health IT to promote innovation, expand consumer access to information, and improve patient safety. Current law is in desperate need of a make-over, and I’m pleased to work with Senator King on this commonsense solution.”

Under current law, the Food and Drug Administration (FDA) can use its definition of a medical device to assert broad regulatory authority over a wide array of low-risk health IT, including mobile wellness apps, scheduling software, and electronic health records.

The PROTECT Act gives clarity to FDA’s regulatory process to focus on products that pose a legitimate risk to human health. This more effective, risk-based framework boosts patient safety by prioritizing FDA’s attention to technologies that pose the greatest health risk. It also protects low-risk health IT from unnecessary regulatory burdens that stifle opportunities for job creation, innovation, and improved care. Notably, the legislation relieves categories of low-risk clinical and health software from the medical device tax.

U.S. Senator Marco Rubio (R-Fla.) is an original cosponsor of the legislation.

The PROTECT Act is supported by IBM, athenahealth, Software & Information Industry Association, Newborn Coalition, and McKesson.

Similar legislation addressing health software, the SOFTWARE Act (H.R. 3303), was introduced in the House of Representatives by Rep. Marsha Blackburn (R-Tenn.) in October. Blackburn released the following statement applauding the introduction of Fischer and King’s legislation:

“I am pleased that Senators Fischer and King are joining our bipartisan House effort to address this issue head on and promote the innovation of these low-risk health technologies,” said Blackburn. “It is imperative that we work to encourage the continued development of new technologies to improve healthcare and create new jobs without added regulatory burdens that would place disincentives on private sector innovation.”

Read the full King Senate news release here

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Lenovo sales hit $10.8 billion as company eyes smartphone biz

Lenovo posted record sales of $10.8 billion on Thursday and emphasized plans to expand aggressively in China -- the world's biggest smartphone market.

The Chinese company said net income grew by 30% to $265.3 million in the final three months of the year. Operating profit rose by 37%, clocking in at $334.2 million for the same period.

The results put Lenovo on solid footing as it branches out from its core PC business and enters the smartphone business in a big way.

Two weeks ago, the company announced that it had acquired smartphone maker Motorola Mobility for $2.9 billion from Google (GOOG, Fortune 500).

"This acquisition perfectly fit into our strategy," said Lenovo CEO Yang Yuanqing. "We plan to relaunch, re-introduce the Motorola brand to China and other emerging markets ... In China, Motorola is still a respected brand."

The acquisition could keep Lenovo's smartphone sales on an upward trajectory. Sales rose 47% in the most recent quarter due to strong growth in Asia.

China is already the top source of revenue for the company, reaching $4 billion in the most recent quarter alone. But gaining market share in the smartphone world won't be easy, as the company faces stiff competition from other firms including Huawei, Xiaomi and Apple (AAPL, Fortune 500).

Read the full CNN Money article here

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Health insurance enrollment on target in January

For the first time since the federal and state health-insurance marketplaces opened early last fall, the number of people who signed up for coverage exceeded the government’s expectations for the month in January, bringing the overall total to about 3.3 million.

Across the country, nearly 1.2 million people enrolled in health plans last month through the new insurance exchanges — more than federal officials had envisioned when they compiled monthly targets late last summer, weeks before the sign-ups began.

The figure is part of a detailed report issued Wednesday by the Obama administration, providing the latest look at how the effort to extend health insurance to more Americans is faring.

The report suggests that January was the first month in which enrollment was not dampened by serious computer defects, which initially stymied people trying to use the federal online marketplace,, and some of the 14 similar marketplaces run by states.

Still, the lingering imprint of those early problems remains visible in the new report. Overall, the 3.3 million people who have signed up for coverage are about 1 million fewer than federal officials had anticipated by the end of January. That difference dovetails with a revised prediction last week by congressional budget analysts — that 6 million Americans, instead of 7 million, are likely to get insurance through the marketplaces by the time this year’s sign-up period ends March 31.

Winnowing the ranks of the uninsured is a central goal of the 2010 Affordable Care Act, which created the online marketplaces. In issuing the latest report, the government’s top health official and several aides said they did not yet have data to answer two critical questions: Of the people who have signed up, how many have paid their first premium so that they actually have coverage? And how many of them previously lacked insurance, as opposed to having simply switched insurance plans?

Nonetheless, Health and Human Services Secretary Kathleen Sebelius called the numbers “very, very encouraging news,” and she said, “We are seeing a healthy growth in enrollment.”

Sebelius and the report focused attention on a slight increase in the proportion of young adults signing up for coverage — a part of the population whose participation is widely considered essential to keeping the marketplaces working well, because they tend to be healthy and, thus, inexpensive to insure.

Of the people who selected a health plan last month, 27 percent were between the ages of 18 and 34 — the group considered young adults — compared with 24 percent for the previous three months combined. Both figures are substantially less than 40 percent, the level that research has suggested is desirable to help health plans sold through the exchanges keep their prices stable.

Read the full Washington Post article here

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