Federal Requirements for Sharing Medical Records Jeopardize Privacy

The Office of the National Coordinator for Health Information Technology (ONC) adopted a final rule on March 9, and the Centers for Medicare & Medicaid Services (CMS) issued another rule on the same day, both of which are aimed at improving patients’ access to their own medical records.

According to the final rules, hospitals are prohibited from blocking patients’ information and are required to send electronic notification to another healthcare facility where a patient is transferred. The final rules also empower patients to access their medical data through any third-party application, such as Apple Health. CMS mandates medical and insurance plans to enable patients to transfer their clinical data to establish a cumulative health record for information sharing purposes.

Despite the empowerment of access to their health data, critics are concerned about patients’ privacy. The final rules “fail to protect consumers’ most sensitive information about their personal health,” Rick Pollack, the American Hospital Association president, commented. “The rule lacks the necessary guardrails to protect consumers from actors such as third-party apps that are not required to meet the same stringent privacy and security requirements as hospitals.”

The American Medical Association has warned that the new rules could allow patients who transfer their confidential medical information to third-party apps to get involved in rampant privacy abuse, given the lack of federal privacy protections regarding customer data on the apps. Electronic Health Records (Epic) believes that the rules could result in the misuse of customers’ data by, for example, apps exploring more data than patients intended without their consent.

A pamphlet  designed by federal health regulators warns patients: “Be careful when sending your health information to a mobile application or other third party” because health providers are “no longer responsible for the security of your health information after it is sent to a third party.”

It’s possible that these platforms would have no problem using patients’ private information for insurance underwriting if the personal information was revealed on these health apps, such as sharing with app developers, affiliate firms, or third-party companies to target the suitable customers in terms of sales and marketing.

Moreover, information of family members will also face sharing risks, as Epic estimates that roughly 79% of healthcare apps are engaging in the data distribution business. For the sake of privacy, patients need well-rounded notification regarding how their data will be utilized and whether app developers will be responsible if they do not comply with what they have promised.

Federal Requirements for Sharing Medical Records Jeopardize Privacy

Cash Crunch: Global Pandemic Squeezes Startups

Businesses closed. Customers gone. Employees home. While COVID-19’s economic impact is still in its earliest stages, many have already felt its repercussions. Over the past month, effects from the outbreak have hit small businesses hard, and many companies do not have the resources to afford temporary – not to mention prolonged – closure. In a letter to its portfolio companies, Sequoia Capital labeled COVID-19 as the “Black Swan of 2020” and warned of drops in business activity, supply chain disruptions, and curtailment of travel.

Among the businesses affected are high-flying technology startups. California, home to tech hubs like San Francisco and Silicon Valley, was the first state to enact measures restricting travel, business hours, and in-person socialization. These restrictions create extreme difficulty for founders raising capital or running operations. While some venture capitalists publicly express their continued interest in funding companies, many predict that the deal pace will slow due to practical difficulties associated with a remote work environment. Investing in young, unestablished entrepreneurs without a face-to-face meeting or a hands-on product demonstration might be a deal-breaker.

Startups in the travel and leisure industries are being hit especially hard. Airbnb, a tech darling commanding one of the largest private valuations, may pause their plans to go public later this year. According to sources, Airbnb shares were privately valued at more than $140 prior to the outbreak, but are now valued at close to $105 – a $15 billion devaluation. The company is reportedly considering raising more cash to fund operations but may have difficulty attracting a high price given the economic uncertainty in the global markets. In the meantime, week-over-week booking demand for their online rental marketplace cratered 95% in Asia, 75% in Asia, and 50% in the U.S.

Amid the uncertainty, some companies are trying to look to the future. Many founders and funders took advantage of the rosy financial outlook prior to the outbreak, and many startup companies are sitting on large piles of cash. The decade-long bull market fueled aggressive investments from private investors, pushing startup valuations to all-time highs. However, many startups that have not sought private equity, relying instead on cash flow from sales or donations, might be at real risk of insolvency. Perhaps Sequoia, quoting Darwin, has it right: “Those who survive are not the strongest or the most intelligent, but the most adaptable to change.”

Cash Crunch- Global Pandemic Squeezes Startups

Stock Market Update as the Nation Attempts to Recover from COVID-19 Crash

As businesses are forced to shut their doors due to the evolving pandemic, the stock market took a significant hit on Monday, March 16th. While the S&P 500 saw the most significant drop since the beginning of the outbreak (roughly 12%), it seems the market is already making strides to recover.

On Thursday, the S&P 500 and Dow Jones were able to trade relatively high after a week of abysmal decline. Contrary to past expectations derived from similar economic events, many tech stocks are gaining strength in spite of the crisis. The mandated social distancing and shelter-in-place in certain counties has led to a resurgence of usage for companies like Facebook, Netflix, and Amazon, and their stocks in particular appear to be recovering as of today (up 7%, 8%, and 5% respectively). It seems that investors may have found more confidence in tech companies that were able to react quickly and efficiently to the crisis and continue to provide services to people during this isolating time.

Additionally, the volatility of the market is at an all-time high as investors evaluate the current onslaught of information regarding COVID-19. Wall Street investors are watching policy makers closely as they consider drastic bailouts accompanied by limits on stock buybacks and executive compensation. However, these limitations may actually hinder shareholder value. With stock buybacks, companies can make massive purchases of their own stock in order to raise their stock price and help the market recover. By limiting companies’ ability to superficially inflate stock prices, the bailouts may not be as effective as they could be.

As with the pandemic itself, this situation is continually evolving. Although the stock market appears to bounce back, the economic implications of this virus will be felt by many in the coming months. Economist Patrick Anderson commented: “This is a body blow to the economy unlike anything we’ve experienced in recent memory. Even the Great Recession did not include shuttering of businesses by government order at the same time that people were being told to stay home.”

This is undoubtedly an unprecedented time, and solutions from policy makers and community members must be equally unique.

Stock Market Update as the Nation Attempts to Recover from COVID-19 Crash

Coronavirus: A Social Media Pandemic

Amidst the general anxiety surrounding the spread of Coronavirus, a wealth of misinformation within social media adds to the panic. Conspiracy theories range from claims that the virus is a concoction by pharmaceutical companies to increase sales of a yet-to-be released vaccine to claims that there are many medications already in distribution that can immunize people from the virus. Despite the aggressive effort of social media companies, misinformation continues to escalate.

Facebook, YouTube, and Twitter all recently stated they are making considerable efforts to promote reliable sources of medical information and maintain direct communication with the World Health Organization (“WHO”) and Centers of Disease Control and Prevention (CDC). Despite their efforts, private groups are still able to share misinformation regarding the virus, including a Facebook group with over 100,000 members. YouTube, while consistently removing videos depicting medically unsubstantiated methods to prevent the spread of Coronavirus, is still host to videos that erroneously claim the virus has a cure. Even though companies are constantly working against the spread of misinformation, false claims continue to surface and remain a constant issue. Even so, there is likely a ceiling to companies’ abilities to limit bad information, especially during a global crisis. WHO not only declared the virus a pandemic, but noted that the virus has sparked an “infodemic,” with an overwhelming amount of information exchanged through social media, both accurate and false.

Fortunately, social media companies are not the only line of defense against the proliferation of “fake news.” WHO launched a program called EPI-WIN, or WHO Information Network for Pandemics, to ensure that appropriate facts about the virus are communicated to the public. The program is rapidly debunking unjustified medical claims on social media and through the use of large-scale employers. Based on a 2020 study, which reflects the idea that employers are the most trusted institution in society, EPI-WIN contacted Fortune 500 companies and others in a variety of industries to advance accurate information through Q&A forums. This endeavor, in conjunction with social media companies, will hopefully slow the spread of harmful and false information.

While misinformation may just be an inconvenience and point of social contention in some situations, it can become hazardous in others. The fact that fake news spreads much more quickly than real news creates a dynamic in which inaccurate medical information could actually worsen the impact of the outbreak. If large portions of the public turn to false treatments, the disease could travel faster and further than it ordinarily would have.

In this time of upheaval, constant change, and misinformation, individuals can employ the “SIFT technique” to investigate questionable content. SIFT stands for stop, investigate the source, find better coverage, and trace claims, quotes, and media to the original content. This method can help readers separate reliable information from faulty sources online and help the public stay accurately informed.

Coronavirus- A Social Media Pandemic

Venture Capital Investments Expand to Foreign Markets

Historically, the venture capital (VC) industry has concentrated its main activities locally, as a regional phenomenon. Unsurprisingly, the US venture industry remained geographically focused in 2019 as its three main hubs – California, New York, and Massachusetts – held up to 84% of total US VC Assets Under Management. Regarding foreign markets, until this past decade, both VC limited and general partners have avoided deploying capital overseas due to additional political, legal, administrative and cultural risks that impose challenges. Despite that phenomenon, the time has come for innovation to be driven not only by the startups but also by the venture capitalists while increasing portfolios abroad.

Recent data evidence the expansion of investments to foreign markets. According to the NVCA, 48% of the $257 billion invested in 2019 was entrusted to companies outside the US, maintaining the steady foreign market share of about 50% seen in the last four years, in contrast to past numbers: 33% in 2010, 16% in 2004, and less than 10% in the 1990s. In this sense, a few players show off their performance: the 500 Startups firm topped PitchBook’s 2019 ranking as the most active global early-stage VC investor with 285 deals; the Plug and Play Tech Center grew their international investments by 11% in 2019. More specifically, these are some countries where startup funding is blasting off: Colombia, Vietnam, Nigeria, Mexico, Brazil, Spain, and India.

A close look in the Latin American market illustrates such a trend, as it has been considered the “new China” in regards to venture investing. Softbank announced in 2019 the launch of a new $5 billion technology growth fund for Latin America.

Colombia’s main representative, the delivery startup Rappi, raised its Series E financing round of about $ 1 billion in a pre-money valuation of $2.5 billion. Brazil – historically the largest recipient of venture funding in Latin America – ranked third in the number of unicorns in 2019 – already accounts its newest representative of 2020, and enlists several other candidates to such a title. Given its high growth rate in the past two years, the country hosts initiatives that support first-time founders studying abroad to launch their businesses in Brazil and holds the attention of investors establishing their roots abroad, like 500 Startups.

A few factors contribute to the worldwide expansion, such as geographical arbitrage, that permits investors to retain undervalued companies and professional talents to support them in reaching profitable exit strategies, either in the US or in their home market. Diversification of portfolios and the growth of international networks may also drive VCs to differentiate themselves in the market. Also, the increase of corporate venture capital, the lack of financing options compared to the number of global opportunities – which developed a more cash conscious mentality – and the increase of the internet penetration allied to the digitalization of services are elements to be considered.

Overall, the US and foreign VC landscape are likely to share a systematic recession that is yet to be determined by the impact of the current global crisis (COVID-19), and should be overcome with time, based on the historical resilience of the industry through financial downturns

Venture Capital Investments Expand to Foreign Markets

 

 

 

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Starbucks Tests a Greener Cup

Starbucks implemented new cups in various cities across the world to promote an environmentally friendly way of serving customers. The paper cups have a liner made out of biodegradable materials instead of the customary plastic option. Heather Haddon of the Wall Street Journal noted that “the coffee giant on Monday started using a prototype of a more sustainable paper cup in some of its cafes in New York, San Francisco, Seattle, Vancouver, and London.” Starbucks is still ensuring top quality coffee by asking baristas and customers whether their drinks are remaining hot and avoiding leaks.

Two years ago, Starbucks joined the movement for more environmentally friendly service by banning the use of plastic straws and setting a goal of eliminating the item from its stores by 2020. Starbucks also uses strawless lids for many of its cold beverages. In an article written by The Guardian, Arwa Mahdawi stated “cold beverages make up more than 50% of Starbuck’s beverage mix, an increase from 37% just five years ago.” In addition to implementing its no straw policies, Starbucks now turns to the cup itself.

Many people in the public are concerned with the environmental risks posed by plastic, and Starbucks does not take these worries lightly. Earlier in the year, Starbucks stated it wanted to cut the amount of waste generated by half in 2030, but there have been challenges to the company’s goals of being greener. Just before 2009, Starbucks recognized the issues surrounding the recycling of its cups and began to focus more on packaging efforts and other ways to help the environment. In 2018, both Starbucks and McDonalds “committed $10 million to a partnership among consumer companies working to develop more sustainable cups.” Also, internal research teams within the company have begun studying ways to have a cup for hot drinks that can be recycled and composted by 2022.

For now, Starbucks will begin testing the new greener cup in its stores. This new way of serving customers came after twelve prototypes were tested, but the final product’s coating inside is made of renewable material that can be spread onto paperboard before cutting. Starbucks will continue to think of new ways to achieve its goals of sustainability and environmentally friendly packaging, but for now, the coffee giant is on the right path towards success.

The Impact of the Coronavirus Pandemic in Stock Markets

It has been a crazy past few weeks for global stock markets. At the start of the month, the New York Times reported that after one of the worst weeks of global markets since the 2008 financial crisis, stocks surged following a promise that governments would step in to strengthen the global economy, which took a hit in the wake of the coronavirus pandemic. However, what investors and government officials were not expecting was an oil price war between two large oil producers –  Saudi Arabia and Russia – in response to the global coronavirus pandemic.

On Sunday, March 8, Saudi Arabia and Russia failed to strike a deal with respect to coordinating production cuts after demand for oil dropped as a result of the coronavirus outbreak. The failure led to Saudi Arabia and Russia flooding the market with cheap oil, where victory meant selling the most oil and grabbing the largest market share, irrespective of the price.

On Monday, March 9, the effect of the oil price war was seen in the stock markets. The S&P 500 fell by 7% just minutes after the stock market opened, triggering a circuit breaker that halted trading for 15 minutes. At the close of trade, the Dow, S&P and Nasdaq were all down roughly 19% from highs set earlier this year. Ironically, the last time stocks had bottomed out like this was on March 9, 2009, better known as Black Monday during the financial crisis.

With stock markets continuing to slide, the central banks on Thursday, March 12, led by the U.S. Federal Reserve and the European Central Bank, sought to intervene to calm the markets but failed. The primary tools used by central banks were to lower interest rates and provide easier access to credit; these tools, unfortunately, were not suited to address an economic crisis created by a global pandemic where consumers avoid traveling, shopping, and gathering in social groups. As a result of this failure by central banks, the stock markets dove into their worst plunge in more than three decades. Some have referred to this as “Black Thursday 2020.”

On Friday, March 13, Wall Street staged a comeback with a broad rally that sent the Dow Jones Industrial Average nearly 2,000 points higher, its largest point gain since 2008. The rally followed President Donald Trump’s national emergency declaration, which allows the U.S. to use the emergency powers found within the Public Health Service Act, the Stafford Act, the Social Security Act and other statutes to address the coronavirus outbreak in the U.S.

While Trump’s national emergency declaration will address earlier criticism with respect to helping cash-strapped workers, particularly those without access to adequate health insurance and healthcare, it remains to be seen when the recent financial rollercoaster will come to an end.

The Impact of the Coronavirus Pandemic in Stock Markets

 

Cash-Strapped Pakistan Determined to Combat COVID-19

Since the coronavirus outbreak in China and an increased number of those affected has been reported in the neighboring countries of Pakistan and Iran, Pakistan has put in efforts to curb the reported COVID-19 cases by sealing off its border. Such stringent measures has further jolted Pakistan’s economic stability, especially since the economy is already strangled nearly to its death by hefty debts and bailout packages from international lenders. International economic assessors, such as the Asian Development Bank (ADB), reported Pakistan’s economy may suffer a loss between $16.387 million to $4.95 billion. According to the estimates made by the United Nations, the virus could cause international tourism to plunge to 3% globally and it may wipe off the country’s efforts to attract tourism.

As stock prices hit their lowest, virus concerns are freezing up economic activities across the world. This has forced the New York Federal Reserve to inject $1.5 trillion into the American financial market to prevent a repeat of the 2008 credit crunch. But in light of the current shutdown, cash strapped Pakistan’s GDP will lose 1.57%. Additionally, there is fear that 0.9 million people may lose their employment. In the worst-case scenario, a country mainly based on its agricultural and mining export will suffer a $21.7 million blow.

With the rise of coronavirus and the scaling up of uncertainties in Pakistan, which has concrete trade and production ties with China, the estimated losses may be further aggravated. Ongoing projects under the banner of the Pakistan China Economic Corridor (CPEC) would now take longer to complete, after the Chinese workers would be quarantined for at least 14 days before their entry to Pakistan. This indefinite delay is yet to bring an additional burden and expense to the country, especially during this hard time. Pakistan received a fresh grant of $6 billion from the International Monetary Fund to combat the economic challenges. Additionally, countries such as China, Saudi Arabia, and UAE relieved Pakistan with deferred oil payments and interest-free loans to raise Pakistan’s registered currency reserves which dropped to an alarming level of $8 billion. This could have bankrupted the country.

However, with prevailing uncertainties in the market, Pakistan’s government has asked the State Bank of Pakistan to ease out the interest rate, and financial institutions are instructed to control the inflation that would encourage investors to do business. Prime Minister Imran Khan’s economic strategies have proven helpful in the present situation, after the country geared up to boost its textile exports to EU countries, while China’s manufacturing industry is partially shut down. Besides EU’s preferential trade status, Pakistan has succeeded to grab more orders than usual due to its free-floating exchange rate and increasing discount rate introduced in 2019.

Hopes are high that Pakistan may sustain through the economic challenges, though there are much left to be alleviated. Therefore, the country should have back up plans and a responsive attitude to the situation changing with each hour.

Cash-Strapped Pakistan Determined to Combat COVID-19

Growth-Minded Food Delivery Company DoorDash Files Confidentially For IPO

On-demand food delivery company, DoorDash, announced last week that it privately filed to go public. Privately filing may give the company a chance to prepare for a potential IPO while avoiding “public scrutiny,” according to TechCrunch. The company, which also operates in Australia, Puerto Rico, and Canada, is estimated to be leading the domestic market.

DoorDash was last valued at $13 billion and has raised $2.1 billion in capital during its lifetime as a private company. Its early backers include Khosla Ventures, Sequoia Capital, and Kleiner Perkins, which led sizeable rounds for the company from 2013 to 2016. In March 2018, DoorDash raised a $535 million Series D led by Softbank’s Vision Fund and went on to raise more than $1 billion following that round. The acceleration in capital infusions is not surprising—DoorDash operates in a cash-intensive, competitive industry. With players like GrubHub, Uber Eats, and Postmates, which have money-filled war chests of their own, along with a slew of smaller regional competitors, capital infusions can keep the marketing spend going.

Of course, with likely significant spending on owning market share, growth is expected to be taking a back seat to profitability for DoorDash, much like its competitor Uber Eats. Uber Eats was a major driver of growth for Uber in its fourth quarter of 2019, reporting $734 million in GAAP revenue—a 68 percent increase over the year-ago quarter. But the service reported an adjusted EBITDA loss of $461 million during that same period. In November, the company announced a new ad platform for Uber Eats, pointing to an effort to exploit additional sources of revenue on the platform.

Why is that important? Should DoorDash pursue a flotation, investors may look to Uber Eats—its growth and its losses—in assessing DoorDash. Some speculate that the WeWork debacle has increased investor skepticism of companies with “growth-first, profitability-second” strategies—even if they are technology (rather than real-estate) driven. DoorDash, unlike other companies, has not cut staff, but has slowed hiring ahead of the filing, according to Techcrunch, Whether the company decides to move forward in this chilling, virus-minded market, and whether investors will subsequently buy into its long-game strategy (at that hefty valuation) will be interesting to see.

Growth-Minded Food Delivery Company DoorDash Files Confidentially For IPO

Trump’s Proposed Roll-Back of Fuel Efficiency Standards Remains Incomplete

As part of his presidential campaign in 2016, President Trump promised Michigan autoworkers a jumpstart on the U.S. auto industry through a roll-back of Obama-era fuel efficiency standards. Since the start of his administration, Trump has eliminated or impaired roughly 100 environmental protections on climate change, clean air, clean water, and endangered species. That being said, the largest federal climate change regulation — Obama’s 2012 fuel economy rules to cut vehicle tailpipe emissions — remains in place.

The Obama-era fuel efficiency standards require automakers to sell vehicles averaging 54 miles per gallon by 2025, which is a 5% increase in vehicle fuel efficiency per year. Trump’s proposed roll-back would decrease the annual increase to 1.5%, which falls below the average 2% increase that auto companies achieve absent regulation. While the Trump administration cites economic benefit as justification for the roll-back, evidence from the draft rule and outside sources point to an economic deficit caused by the new regulation.

The proposed regulation, called the Safe Affordable Fuel-Efficient Vehicles Rule, actually increases the amount individual consumers spend per vehicle according to Consumer Reports. While the lower fuel efficiency standards may decrease the initial vehicle cost in the short-term, consumers will be forced to pay, on average, $3,200 more per vehicle in fuel. Cumulatively, American consumers stand to lose approximately $300 billion. While decreasing the manufacturing costs for large auto-manufacturers, Trump’s proposed regulation shifts those costs onto consumers, creating a net deficit in the American economy. This research is reflected in the draft rule itself. The rule indicates that the Trump fuel economy target would lower the prices of new vehicles by $1,000 but would simultaneously increase the amount consumers pay for fuel by $1,400, creating a $400 net deficit per consumer.

Not only does the proposed regulation fail to achieve the economic benefit promised by Trump, it faces serious legal issues. According to Mr. Lazarus, who specializes in environmental law at Harvard, “[i]f the costs to the economy exceed the benefits, and there are no environmental benefits, the courts would classically look at this as an arbitrary and capricious policy,” making it especially “vulnerable to being overturned.” Furthermore, the draft rule lacks two substantive components that are essential to its defense in court — the environmental-impact statement and the regulatory impact analysis. The former is required by law to accompany any new major policy affecting the environment and the latter details at length the legal, scientific, health, and economic impacts of a major new rule. For example, when proposing the original Obama rule, the accompanying analysis was 1,217 pages long, with supporting research by the National Academies of Science. However, the newly submitted draft by the Trump administration failed to include either of these two components, bringing the legal status of the rule into serious question.

Finally, five large players in the auto-industry have publicly declared opposition to Trump’s new rule, joining California in agreeing to maintain stricter standards. Honda, Ford, Volkswagen, BMW, and Mercedes-Benz have made a pact with California to adhere to stricter fuel efficiency standards, making the Trump administration’s proposed rule moot. Automakers fear that the aggressive roll-back will initiate a drawn-out legal battle between California and the federal government, essentially splitting the market into two, one with stricter emission standards than the other. This result would only add to the economic cost of the proposed draft rule without creating any kind of social, economic, or environmental benefit. Moreover, if enough automakers join California, the proposed draft would be rendered irrelevant. Already, the five automakers listed above account for more than 40% of all cars sold in the U.S. Likewise, 13 other states plan to continue enforcing their current, stricter fuel emission standards and sue the Trump administration if the proposed rule passes.

With the substantive and technical deficiencies in the proposed rule and the public opposition by both state governments and automakers, the probability that Trump’s promised roll-back of Obama-era fuel efficiency standards appears to be declining steadily. Even if passed into law, the inevitable judicial review will likely result in a repeal. In the meantime, the auto industry remains suspended. Without a definite standard, carmakers cannot begin the manufacturing process. Therefore, they have turned their attention to Asian and European markets, further delaying any purported economic benefit for the U.S.

Trump’s Proposed Roll-Back of Fuel Efficiency Standards Remains Incomplete