Issue link: https://beckershealthcare.uberflip.com/i/1203108
22 POPULATION HEALTH 22 CEO / STRATEGY Hospital chain CEO accused of scheming with Joe Biden's brother to steal business plan By Ayla Ellison A Tennessee businessman claimed a younger brother of Democratic pres- idential candidate Joe Biden, a hedge fund manager and the owner and CEO of a hospital chain each played a role in a scheme to steal his company's business model. In a lawsuit filed in July 2019, Michael Frey alleged Jim Biden and others tricked him into turning over sensitive business information about a model for rural healthcare he helped develop. Hedge fund manager Michael Le- witt, Grant White, founder and CEO of Fort Lauderdale, Fla.-based Americore Health, and hedge fund owner Amer Rustom were also named as defendants in the federal complaint, according to the Knoxville News Sentinel. Mr. Frey, who founded Diverse Medical Management with Mohannad Azzam, MD, developed a healthcare model for rural res- idents "seeking treatment for opioid addic- tion, mental health issues, veterans' issues, and sexual trauma," according to Politico, which cited the complaint. In 2017, Mr. Frey began receiving offers from investors, including Mr. White. According to the complaint, Mr. White wanted Mr. Frey and Dr. Azzam to use their model to run Americore's rural hospitals. At the request of Mr. White, Mr. Frey pitched his business model to hospitals in Kentucky. At one of those sales pitches, Mr. Frey met Mr. Biden, who iden- tified himself as "a principal with Americore," according to the Knoxville News Sentinel. In early 2018, Mr. Frey and Dr. Azzam en- tered into talks with Mr. White about merg- ing with his company. Mr. Biden and Mr. Lewitt allegedly promised they would secure international investors, and offered loans through Mr. Lewitt's hedge fund to buy hospi- tals. Instead of securing the funds, the defen- dants allegedly engaged in a scheme to steal Mr. Frey's business model. e lawsuit claimed Mr. Biden and Mr. Lewitt repeatedly promised funds were on their way, and that investments were being finalized. However, Mr. Frey alleged they never intend- ed to provide the investment funds. Aer Mr. Frey disclosed details about his business model to the defendants, they al- legedly presented it as their own. Accord- ing to the lawsuit, Mr. Biden and Mr. Lewitt pitched the business plan to Turkish investors in a whitepaper presented by Mr. Rustom, "His Excellency Jim Biden," and "Her Excel- lency Sara Biden," according to the Knoxville News Sentinel. e defendants denied engaging in a scheme to defraud Mr. Frey and Dr. Azzam, claiming in a response to the complaint that the plain- tiffs sought them out as investors. "Biden and his wife, Sara, have a long-held and passionate commitment to finding solu- tions for the improved treatment of both substance abuse and post-traumatic stress disorder and the linkage between them, par- ticularly in rural areas where so many local hospitals are failing," states a response to the original complaint. "DMM appeared to offer an opportunity to invest in a business that provided important services to this sector." Mr. Lewitt's hedge fund entered into a confi- dential settlement with the plaintiffs, accord- ing to the Ellwood City Ledger. n Best Buy's healthcare strategy: Get insurers to pay By Ayla Ellison B est Buy is known as the largest specialty electronics retailer in the U.S., and a key part of its growth strate- gy is centered on digital health initiatives. In 2019, Best Buy spent roughly $1 billion on acquisitions to expand its healthcare services, according to Forbes. The company's expansion into healthcare has helped it overcome broader declines in consumer electronic sales, according to Bloomberg. Senior care is Best Buy's niche in the healthcare services market. One million seniors are using the company's health offerings, and Best Buy's goal is to expand its services to 5 million seniors by fiscal 2025, according to MarketWatch. "Today, most of the seniors we serve are utilizing easy- to-use mobile phone products and connected devices that are tailored for seniors and come with a range of relevant services," Best Buy CEO Corie Barry said during an earnings call Nov. 26, 2019, according to a transcript from Seeking Alpha. Ms. Barry also shed light on how Best Buy plans to expand its healthcare business. She said the company plans to scale its "five-star service" that connects seniors with care- givers, dispatches emergency personnel and more. "We also expect to advance our commercial business where the services we provide for seniors are paid for by insurance providers. This includes services such as remote monitoring based solutions that provide meaningful in- sights to improve timely care and reduce the cost to serve frail seniors," she said. The company could generate as much as $46 billion in rev- enue from its commercial health business over the next 10 to 20 years, according to Bloomberg, which cited Morgan Stanley estimates. n