6 minute read
Interview: Phillip Dingle
Phillip Dingle Managing Partner HealthEdge Investment Partners
What emerging or continuing trends are you watching in the healthcare sector?
There are a few. One is the increasing application of artificial intelligence and machine learning to various aspects of healthcare, almost all of which is designed to do two things. One is to improve the quality of care by providing for better decision-making as it relates to patients. The other use is from a business perspective, which is lowering the cost to administer healthcare. Any proposition that can eectively lower that cost is great for consumers, taxpayers and our businesses. We are also keeping our eye on the unknown, which is the political environment after the election next fall, and subsequently, what decisions will be made that will directly aect the healthcare sector.
What are some of the key factors you look at when deciding who to invest in?
We are looking at recurring revenue and businesses that have no more than modest capital expenditure needs. We also like good management teams, but that is not necessarily essential to our thesis because we have a roster of operators and leaders who can enter the business and really drive growth, improve the company and its governance, improve sales and marketing and help to dierentiate the business from its competition.
What is the key to attracting more venture capital and private equity into Tampa Bay?
Owners and operators need to think about private equity and venture capital less in terms of how they read about it in national magazines and more in terms of a family oce opportunity. We constantly hear negative things about the mega funds and how they treat people, businesses and what their motives and mandates are. This is entirely dierent from the smaller, middle-market buyout funds or venture investors who really want to build businesses and are less focused on cutting costs than they are on taking a business that might be a Bbusiness and transforming it into an A+ business.
In the Tampa Bay region, 1 in 6 people suffer from depression, and 1 in 12 suffers from substance abuse disorder
perhaps explains why economists say that 260,000 people from low-income households would enroll in an expanded Medicaid program if the state accepted federal funding. This is around 44% of those eligible for the expanded support. The study showed that 75% of those between 46 and 55 would participate in the Medicaid program, if expanded. In June, the St Petersburg city council voted 6-2 in favor of the Medicare for All Act of 2019, with only one person speaking against the initiative at the meeting.
At a time when it is difficult to incentivize people to sign up for insurance services, companies such as Tampa-based Health Insurance Innovations are coming along with solutions to help ease the process. It’s online AgileLifeInsurance direct-to-consumer marketplace for life insurance aims to make insurance a little easier to understand. And in a conveniencedriven economy, the idea is working: the marketplace helped its parent generate $381.8 million in revenue in 2019, up 9% on 2018.
Public health Health policy in 2019 revolved around a handful of key themes that are important to life in Tampa: opioids, marijuana use and mental health. In 2018, mental health providers in Florida saw an average of 703 patients per year, representing a 5.89% decrease from the previous year. One Senate bill that was passed in Florida in 2019 was Bill 1418 on mental health, which mandates that “psychiatrist(s) … disclose patient communications to the extent necessary to warn law enforcement of a threat of serious bodily injury or death made by a patient or client.” It also rules that law enforcement must inform potential victims of a threat.
Florida currently ranks 33rd in access to mental health services. In the Tampa Bay area, one in six
David Pizzo Market President, West Florida – Florida Blue
Technology advancement is one of the main areas of focus for our company right now. Putting the right technology in the right place to ensure an excellent customer experience is one of our main goals. A lot of the eort we have made over the last few years is coming to fruition, and it’s now easier for customers to shop for health care, select the right plan and understand what they are getting. I think there will be massive changes over the next five years because there is so much work to be done in communication and engagement with healthcare systems.
people suffer from depression, and one in 12 struggles with substance abuse disorder, according to BayCare. From 2016 to 2017, suicide attempts jumped by 14% and overdoses by 25%. The West Central Florida Mental Wellness Coalition is trying to address the issue by making treatment more accessible for those living in the Tampa Bay area.
In the wake of so many mental health issues that have helped create an epidemic of gun violence in schools, Tampa authorities are waking up to the reality that mental health needs to be addressed. State Representative Jennifer Webb campaigned to overhaul the Baker Act to target issues when children are involuntarily committed, such as providing the correct mental health support and informing parents in a timely manner. The education system as a whole is also being changed to allow students to take mental health days as an excused absence.
Opioids and their use are also a high priority. House Bill 451 passed in July 2019 addresses nonopioid alternatives, “requiring the Department (of Health) to develop and publish on its website an education pamphlet regarding the use of nonopioid alternatives for the treatment of pain.” This in response to the opioid crisis that still grips Florida. At the height of the crisis, the number of pills entering Florida amounted to an average of 42 pills per resident per year from 2006 through 2012. In 2010, an estimated seven people a day in Florida died from prescription drug overdoses.
But despite efforts of authorities to crack down on opioids, the new epidemic that spawned from that is the current heroin crisis. In 2018, Florida’s opioid death rate reached 25 deaths per 100,000 residents, according to the National Institute on Drug Abuse, a 67% increase on the peak of the pill mill crisis because of heroin and fentanyl abuse. Hillsborough County authorities have recently established a needle exchange program, following in the footsteps of Manatee County. Hillsborough deputies now are obligated to carry Narcan to counteract overdoses.
In the first half of 2019, Hillsborough opioid overdose deaths totaled 118, according to the Hillsborough County Medical Examiner, while 2018’s total was 235. In 2017, 98 deaths in the county were attributed to heroin or fentanyl. In 2018, the number was 153 and 2019 figures are expected to be even higher.
The third leading issue is marijuana use. The value of the CBD (cannabidiol) market is expected to surpass $20 billion globally by 2024 and Florida is taking steps to ensure it is well-positioned to take advantage. BDS Analytics has an impressive growth forecast for the CBD market, across all distribution channels, at an annual rate of 49 percent by 2024. Since hemp was legalized on a federal level, several CBD sellers have sprung up around Tampa Bay, including Trulieve, Your CBD Store, The Smoke Bodega, Surterra Wellness, Wholistic Medical Group, CBD American Shaman, West Tampa Smoke Shop, Nothing But Hemp, Renew Spa and Wellness, and Bull’s Eye Wellness.
But opening up a new industry to commercialization comes with teething problems and Tampa Bay legislators may struggle to keep up. In Florida, Amendment 2 legalized CBD use for medical purposes in the state and the 2018 Farm Bill legalized hempbased CBD products federally. But Florida state legislation previously did not differentiate between marijuana, which contains THC, and hemp, which contains mostly CBD, meaning CBD products are simultaneously legal and illegal in Florida.
On July 1, 2019, however, a new law took effect ( )
