IRVINE, Calif. - Masimo (NASDAQ:MASI), a global medical technology company, has revealed the results of a study indicating that its remote patient monitoring (RPM) platform, Masimo SafetyNet®, significantly reduces hospital readmissions and emergency department (ED) visits after total joint arthroplasty (TJA).
The study, conducted by St. Luke’s University Health Network in Pennsylvania and other institutions, was published in the Journal of Orthopaedics.
The research involved 100 patients divided into two groups: 50 who received RPM post-discharge and 50 who did not. The RPM group used Masimo MightySat® pulse oximeters and Omron blood pressure monitors to send health data to a virtual response center (VRC). Clinicians monitored this data and intervened as necessary.
The study found that this group had a notably lower rate of readmissions and ED visits compared to the control group, who only received standard postoperative instructions.
The RPM cohort showed a 20% rate of abnormal vital sign recordings, with only 4% requiring ED visits and none readmitted to the hospital. In contrast, the control group had a 12% rate of ED visits, all of which resulted in hospital admissions. The study authors suggest that remote home monitoring could have prevented most of these readmissions, which they estimate cost around $7,000 per patient.
While the researchers did not perform a formal cost analysis, they estimated that for every 1,000 TJA surgeries, the RPM program could potentially save hospitals approximately $800,000 by reducing readmissions. Moreover, patient surveys from the RPM group indicated high satisfaction, with 79% of respondents agreeing that the program helped in their care and made them feel safer at home.
The study supports the feasibility of remote home monitoring as an effective strategy for reducing readmissions in the acute postoperative period. The authors emphasize the balance between cost minimization and patient health outcomes, suggesting that RPM can help achieve this balance in outpatient TJA surgeries.
This research is based on a press release statement from Masimo, which also highlighted the company's broader mission to improve patient outcomes and reduce healthcare costs through innovative monitoring technologies. Masimo's products are widely used in hospitals and other healthcare settings globally, but it is important to note that Masimo SafetyNet is not intended for real-time monitoring.
In other recent news, Masimo Corp reported robust preliminary second-quarter 2024 results, exceeding expectations, particularly in the Healthcare sector. The company's healthcare revenue reached $344 million, marking a 22% year-over-year reported growth.
Still, the non-healthcare revenue experienced a decline, posting $152 million. Amid these financial developments, Masimo is also in active discussions to sell a majority stake in its consumer business, valued between $850 million to $950 million.
The company's performance has led to Stifel and BTIG maintaining their Buy ratings on Masimo's shares, with Stifel reiterating a $170 price target and BTIG holding steady at $166. Furthermore, Piper Sandler upgraded Masimo's stock from Neutral to Overweight, citing improvements in the company's core healthcare business.
On the governance front, Institutional Shareholder Services (ISS) and Glass Lewis have advised Masimo shareholders to vote for the election of two director candidates put forward by Politan, an activist investment firm. ISS emphasized that additional changes are necessary at Masimo, suggesting that this could be achieved with additional changes to the board.
In response to these developments, Masimo's Chief Operating Officer, Bilal Muhsin, disclosed a conditional resignation, contingent upon the removal of Joe Kiani as Chairman of the Board and Chief Executive Officer.
InvestingPro Insights
As Masimo (NASDAQ:MASI) continues to make strides in the medical technology field with its remote patient monitoring platforms, the financial metrics from InvestingPro provide a broader context for evaluating the company's performance and potential. With a market capitalization of approximately $5.8 billion and a high price-to-earnings (P/E) ratio of 72.53, Masimo's valuation reflects expectations of future growth, despite recent downward revisions by analysts for the upcoming period.
InvestingPro Tips indicate that while Masimo's net income is expected to grow this year, the company is trading at high earnings, EBIT, and EBITDA valuation multiples. These high multiples suggest that investors are paying a premium for Masimo's earnings and profitability prospects, which could be justified by the company's innovative products and their potential to reduce healthcare costs as demonstrated in the recent study. Moreover, the company's liquid assets exceed its short-term obligations, providing financial stability and the ability to invest in further growth and development.
InvestingPro Data shows a revenue of $1.975.9 million over the last twelve months as of Q1 2024, with a decline in revenue growth by -13.96%. Despite this, the company maintains a strong gross profit margin of 48.61%, indicating its ability to control costs and generate earnings efficiently.
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