This was a year unlike any other as the world responded to the pandemic public health emergency by deploying telehealth solutions to comply with social distancing orders and fast-tracked development and deployment of diagnostics, therapeutics, and Covid-19 vaccines.
As we move into 2021, we expect big data collaborations and analysis through artificial intelligence (AI) to continue fostering innovation in clinical decision support (CDS) software, patient treatment, and pharmaceutical research. We also expect the movement toward increased portability of patient health information and telehealth usage, fueled by the public health emergency (PHE), to continue in the years to come.
Some key trends to expect, as well as related transactional and regulatory compliance concerns, are summarized below.
Data Sharing Agreements
Data sharing and AI collaboration agreements are likely to increase as companies seek to efficiently extract useful insights and inferences from larger and more diverse data sets.
Because rights in data are not uniformly governed by statute, contractual provisions are critical to address novel issues in the rights of collaborators. Participants in data pooling initiatives need to consider what data will be shared, participants’ rights to use the compiled data sets, and the rights retained by each contributor in such data and arising inferences outside of the agreements.
Critically, AI platform providers and owners of proprietary data sets will need to address whether the AI platform is permitted to retain any learning derived from the data set that may be used for other customers, including potential competitors of the data set owner.
Further, the evolving data privacy regulatory framework, including the passage of the California Privacy Rights Act (CPRA) in November, and the California Consumer Privacy Act (CCPA) that went into effect in January 2020, may impose heightened obligations for previously ”lightly” regulated data sets.
For instance, personal fitness information collected by smart devices, while likely not covered by the Health Information Portability and Accountability Act (HIPAA), may be covered under the CCPA and may receive heightened protection as “sensitive personal information” under the CPRA. Data sharing collaborations will continue to be shaped by the rapidly evolving regulatory landscape.
Tech, Software Innovations
Innovative digital health software, such as AI tools and CDS software, will continue to proliferate, but require careful consideration of rapidly evolving regulatory and statutory regimes.
The Food and Drug Administration’s risk-based approach to digital health software regulation during the PHE has been largely consistent with its pre-pandemic regulation, with a focus on exercising enforcement discretion for low-risk software products that could aid in minimizing physical contact between patients and their health-care providers.
In 2021, we anticipate the FDA will renew its broader efforts to clarify the regulatory approach to medical software products, led by the Digital Health Center of Excellence, which the agency established in September 2020. Notably, finalizing the CDS draft guidance and issuing draft guidance on AI are both on the FDA’s Center for Devices and Radiological Health list of priorities for 2021.
Exchange of Information
New regulations that promote interoperability and exchange of electronic health information will impact health IT development.
In 2020, the Centers for Medicare and Medicaid Services and the Office of the National Coordinator for Health IT issued rules implementing interoperability, information blocking, and patient access provisions of the 21st Century Cures Act to facilitate the access and exchange of electronic health information.
New requirements that take effect in 2021 include:
- Prohibition on information blocking, which is applicable to health IT developers, providers, health information exchanges, and health information networks;
- Electronic admission, discharge, and transfer notifications, required for Medicare-enrolled hospitals;
- Patient access application programming interfaces (APIs), required for Medicare Advantage, Medicaid, Children’s Health Insurance Program (CHIP), and qualified health plan insurers; and
- Provider directory APIs, required for Medicare Advantage, Medicaid, and CHIP.
Drug Development and Real-World Data
Regulators are expected to clarify their approach to drug development that incorporates real-world data analyses powered by health technology platforms.
Although uptake of real-world evidence (RWE) approaches in drug development has been limited by a lack of clear regulatory guidance or comfort with RWE, in 2020 regulators and industry have heavily relied on real-world data to understand Covid-19 and to assess potential treatment options.
In 2021, the FDA is expected to release guidance addressing how sponsors can utilize real-world evidence in drug development, as required by the 21st Century Cures Act. This guidance, along with the increased comfort stakeholders have gained with RWE during the pandemic, could drive increased utilization of real-world evidence in drug development.
Reimbursement
We expect that government and commercial payors will increasingly reimburse services provided remotely through telehealth and other digital health technologies.
Historically, insurance coverage for remotely provided services varied by insurer and geographic region, and Medicare coverage, in particular, was limited. However, CMS and other payors loosened reimbursement requirements for telehealth services during the PHE.
In 2021, CMS is adding new Medicare-reimbursable telehealth services, and state Medicaid programs and private insurers may follow suit.
After the Pandemic
As the pandemic subsides and the focus of regulators shifts, the digital health landscape will continue to be shaped by the legacy of the Covid-19 PHE.
The continued proliferation of big data, AI, telehealth, and other innovative digital health tools will require commercial actors to carefully consider contractual language and insurance coverage for new technologies. Anticipated FDA and CMS regulations and guidance are likely to affect both software and drug development, and new and clarified privacy obligations may impact any use of data in that development.
Those on the forefront of digital health innovation should continue to monitor these ongoing legal issues and plan accordingly in 2021.
This column does not necessarily reflect the opinion of The Bureau of National Affairs, Inc. or its owners.
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Megan Baca is a partner in Ropes & Gray’s intellectual property transactions practice in Silicon Valley.
Kellie Combs, based in Washington, D.C., is a partner in Ropes & Gray’s life sciences regulatory & compliance practice.
Christine Moundas is a partner in Ropes & Gray’s health-care practice in New York.
The authors are co-chairs of the firm’s digital health initiative.
The authors would like to recognize the contributions of Sarah Blankstein, William Ognibene, Gideon Palte, Michael Purcell, and Shong Yin, all associates at Ropes & Gray .
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