Would it blow your mind if only five startup health plans interested in Medicare Advantage (MA) have collectively raised over $3.9 billion in private funding to-date? Well, readers, that is the reality. Now I know there are some skeptics out in the healthcare ecosystem, so I’m here to break down some of the investment thesis. Not going to necessarily defend, but explain some reasons why you should love and hate these investments. Let’s start with who raised these mind-boggling sums of money. The five startups are Oscar Health, Bright Health, Clover Health, Devoted Health, and Alignment Healthcare.
Oscar Health has raised $1.3 billion
Bright Health has raised $1.1 billion
Clover Health has raised $925 million
Devoted Health has raised $362 million
Alignment Healthcare has raised $240 million
I think it’s safe to say that the MA insurance market (also known as Medicare Part C) has captured the imagination of the venture capital and private equity community. The changing demographic trends of an aging baby boomer population, the increased selection of MA plans versus traditional Medicare fee-for-service (FFS), and the opportunity of technology-first MA startup plans to better reduce administrative fees (“Administrative Loss Ratio” or “ALR”) and control medical spend (“Medical Loss Ratio” or “MLR”) seems too good to pass up. If you were going to start a health plan, of all the lines of business you could be focused on, MA has highest profit margins, growing population, and better potential to impact patient spend and manage chronic diseases. It is certainly harder than writing the previous statement, but there are some real benefits versus the traditional commercial or Medicaid managed care.
Almirall is a dermatology-focused pharmaceutical company based in Spain, and its investment in R&D for developing new therapeutics leads the way as the largest within the country’s pharma industry. It’s no surprise, then, that Almirall has also adopted a digital therapeutics and digital health strategy to augment it’s molecular innovations with a ‘beyond the pill’ approach. We sat down with Almirall’s first-ever Chief Digital Officer, Francesca Wuttke, to hear about the pharma company’s digital strategy which is centered on laying the framework for advanced analytical platforms that gather more health data about patients and skin health. For help and fresh ideas, Francesca has opened Almirall’s doors to health tech startups, launching a brand-new accelerator program cutely called ‘Almirall’s Digital Garden,’ to ‘seed’ and ‘grow’ innovative solutions. Are there lots of health startups out there that focus on treating psoriasis, acne, and other dermatological conditions? Francesca tells us what she hopes ‘reap’ from the Digital Garden and how she hopes her broader digital strategy will flourish at the boutique pharma company.
Filmed at Barcelona Health Hub Summit in Barcelona, Spain, October 2019.
We’ve been spending a
lot of time these past few years debating healthcare reform. First the
Affordable Care Act was debated, passed, implemented, and almost continuously
litigated since. Lately the concept of Medicare For All, or variations on
it, has been the hot policy debate. Other smaller but still important
issues like high prescription drug prices or surprise billing have also
received significant attention.
As worthy as these all
are, a new study suggests that focusing on them may be missing the
point. If we’re not addressing wealth disparities, we’re unlikely to
address health disparities.
It has been well
documented that there are considerable health disparities in the U.S.,
attributable to socioeconomic status, race/ethnicity, gender, even geography, among other
factors. Few would deny that they exist. Many policy experts and
politicians seem to believe that if we could simply increase health insurance
coverage, we could go a long way to addressing these disparities, since coverage
should reduce financial burdens that may be serving as barriers to care that
may be contributing to them.
Universal coverage may
well be a good goal for many reasons, but we should temper our expectations
about what it might achieve in terms of leveling the health playing field.
As the adage goes, “health is wealth,” and Wellthy Therapeutics is a startup looking to improve the health of patients with chronic conditions in India by making treatment more accessible. Only 5% of Indians are insured and much of the population is not health literate, so CEO Abhishek Shah hopes the Wellthy app will fill a critical gap in care for those with type II diabetes, hypertension, cardiovascular conditions, and respiratory illnesses. With 15K users, the startup is focused on scaling up to truly capitalize on the potential of India’s enormous population. Learn more about their big plans, including those for a Series-A, to support that expansion.
Filmed at Bayer G4A Signing Day in Berlin, Germany, October 2019.
Even this cardiologist knows why. The not so subtle evidence lies in the cloudy
lens in front of his pupils. He is
afflicted with cataracts that obstruct his vision to the point he can’t really
do his job refurbishing antique furniture safely. His other problem is that he hates doctors.
He hasn’t had reason to see one for more than a decade. He’s 68, takes no medications, smokes a pack
of cigarettes a day, and is a master of one word answers. He’s in my office because
he needs a medical evaluation prior to his cataract procedure. Someone needs to
attest to medical safety. I’m it.
He just wants to get out of here.
His annoyance of being in the office is
justified. Cataract surgery is very low
risk. Unless he’s having an acute
medical problem, there is little to do.
The problem is that in an age of high volume, super specialized care,
the eye doctor can’t attest to this, and the anesthesiologists have little
interest in finding out the morning of his procedure that Mr. Smith has been
having more frequent episodes of chest pain over the last two weeks. Perhaps the chest pain is just acid reflux,
or maybe it’s because of a pulmonary embolism related to the tobacco induced
lung malignancy no one knows about. It’s possible, and highly likely, Mr. Smith
will survive his cataract surgery even if
he has a pulmonary embolism.
Cataract surgery really is pretty low risk.
But the doctor’s ethos has never been to
‘clear a patient for a cataract’, it is to commit to the health of the
patient. Mr. Smith deserves the
opportunity to receive good medical care that isn’t made threadbare just
because of the cataract surgery on the horizon.
Bum knees, aching backs, and neck pain are literally a pain-in-the-neck for millions of people – making chronic pain one of the largest areas of healthcare spending. Is it time to disrupt the traditional delivery of physical therapy? Physera CEO, Dan Rubenstein, thinks so, and talks to us about how his healthcare startup is revolutionizing the way physical therapy is being delivered by taking it virtual and driving down the cost. With more than $10M in funding (their $6M Series A was led by BlueCross BlueShield’s Venture Fund) and a major contract with a nationwide health plan provider in the works, the health tech startup is on track to help millions of people feel better and avoid the crazy rush to the PT’s office.
This piece is part of the series “The Health Data Goldilocks Dilemma: Sharing? Privacy? Both?” which explores whether it’s possible to advance interoperability while maintaining privacy. Check out other pieces in the series here.
Early in 2019 the Office of the National Coordinator for Health IT (ONC) and the Centers for Medicare and Medicaid Services (CMS) proposed rules intended to achieve “interoperability” of health information.
In this post we point
out why extending HIPAA is not a viable solution and would potentially
undermine the purpose of enhancing patients’ ability to access their data more
seamlessly: to give them agency over
health information, thereby empowering them to use it and share it to meet
really follow FinTech — I can’t even keep up with HealthTech! — but it caught
my eye when Visa announced that
it was acquiring FinTech company Plaid for $5.3b; a 2018 funding round valued
the company at $2.65b. A 100% increase in valuation within a year suggests
that something important is going on, or at least that people think something
there may be some lessons for healthcare in there somewhere.
of you who are equally as unfamiliar with FinTech’s terrain, Plaid has been described as
the “plumbing” that supports many other FinTech companies.
Launched in 2013, one in four people with a U.S. bank account are now believed to
use Plaid to connect with 2,600 FinTech developers connected to more than
11,000 financial institutions. Its customers include Acorns, Betterment,
Chime, Coinbase, Gemini, Robinhood, Transferwise, and Venmo. Plaid claims
it connects with 200 million consumer accounts.
Today on THCB Spotlights, Matthew chats with a couple of the OGs from the original days of Health 2.0—Scott Shreeve, founder and CEO of Crossover Health, and Jay Parkinson, founder of Sherpaa, who were the first ones doing something different in terms of doctors figuring out this digital health stuff. The two of them ask the question, what would happen if you married the physical world with the online world and created a new care model that exceeds at both? While Scott was putting in onsite primary care clinics to employers like Apple and Facebook, he realized Crossover wasn’t reaching 70% of the people they were contracted with because many employees were geographically remote. Meanwhile, Jay was doing something similar with virtual primary care—which differs from traditional telehealth in that his model enables a true relationship between patient and provider—and the rest is history.