Blake Madden

Investing in companies that fill needs for health systems is a growth opportunity for both delivery organizations and start ups. Some systems are jumping in on their own, while others are partnering with like minded systems or with established VC firms. While this is a relatively new trend for systems, health plans have been making similar bets for many years. The benefits of becoming a health system portfolio company can be significant. Data, access to beta populations and real world coaching can be extremely beneficial. Start ups get mentoring and systems have to ability to leverage outside resources to solve relevant business problems. I predict a booming business!

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“I think it’s important that the person running the organization understands the core thing that the company does.” - Ben Horowitz, GP at a16z. Totally agree, but we actually see the opposite in healthcare. As care delivery businesses are mostly run by people who have no prior knowledge of how to deliver care. The ACA actually prohibits doctors from even owning hospitals. Which completely enables MBAs and other non-clinical administrators to influence how patients receive care. Call me old fashioned but shouldn’t the people trained and licensed to provide care delivery services be the ones running businesses where care services are delivered? 🤷🏽‍♂️ —— Hi, I'm Dr. Mario Amaro, Founder and CEO Ease and I talk about all things starting, running, and growing a private practice with AI. Follow me, if you are planning to start one or are currently figuring out creative ways to grow one. #PrivatePractice #SelfEmployment #HealthcareOnLinkedin #HeyEase #IndependentTogether

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The defining factor isn't the size of the company or startup, but the vision behind it. Take OpenAI, for instance. Until last year, unless you were deeply embedded in the ML world as a computer scientist/researcher, or enthusiast, you might not have heard of OpenAI. Meanwhile, a giant like Google was dominating the scene. However, a few years back, OpenAI was just another small startup. Now, it's rapidly evolving into a major player in big tech. Why and how? It comes down to having a long-term vision, a clear roadmap, patience, and solid execution (i.e., talents). Even in the context of healthcare AI, where (small) startups face many challenges (including the ones mentioned), the principles of vision and strategy apply. While merging with big tech might seem like an option for some, if a startup truly believes in its vision and has a well-defined path to achieve it, it should forge ahead independently. The landscape is evolving, and like OpenAI, today’s small startups with clear, visionary goals could be tomorrow's industry leaders. #starup #founders #openai #google #healthcare

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One key reason why healthcare technologies like AI, telemedicine, and software haven't structurally lowered costs or broadened access for the entire system after decades of experimentation (excluding pure financial engineering of payer contracts) is the limited reimagining of care delivery itself, with asynchronous telemedicine as a notable exception. In the same way that digitizing physical paper failed to exploit the capabilities of a new computing medium for word processing, hosting physician-patient conversations over video does not transform the actual delivery of care. In telemedicine, many of the inputs (e.g., clinician time) and therefore cost structures of in-person care persist, which is why we often see fee-for-service telemedicine companies struggle to achieve economies of scale (i.e., growing revenues non-linearly while growing costs linearly). Until we deconstruct the components of a medical appointment – from intake and triage, to chart review, history gathering, physical examination, diagnosis, treatment, and follow-up – we will continue to be underwhelmed by the disconnect between the transformative potential of these technologies and real-world patient/system impact. I’m optimistic that the emergence of reliable and performant medical AI agents will urge us to perform this deconstruction and redesign the fundamental building blocks of a “medical appointment.”

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👏 Great article by Brian Spisak, PhD and Todd Norwood! They address the need to improve data quality to find value from AI in healthcare and lay out ✨ 10 KPIs ✨ that healthcare organizations can pursue to take advantage of the AI Revolution. Great work here!

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Here’s your recap of last week’s health IT news 🗞️ 👇 💼 Administrative • Pager + League: The care orchestration solution will be embedded into the patient engagement platform for maternity care.    • Veradigm®: The ambulatory care solutions vendor has announced that it is exploring a merger, sale, or other transaction.    • Kyruus Health: The provider search and scheduling solution said it would add MEDITECH to its list of EHR partners which already includes Epic , Oracle (Cerner), athenahealth , and others.   🥼 Clinical • Clover Health: The physician enablement technology company launched its previously internal-facing clinical decision support tool via its subsidiary Counterpart Health as a standalone solution for external Medicare-focused payers and providers.    • Children's Minnesota + ShiftMed: The pediatric health system is partnering with the on-demand workforce tech platform. 🤝 VBC • Innovaccer: The VBC data & analytics company launched its quality management and reporting platform for health plans. 🤖 AI • Plenful: The AI workflow automation company focused on streamlining pharmacy operations announced a $17M Series A.    • SamaCare: The AI prior auth platform announced a $17M Series B. 💡 Things We Found Interesting • In our view, there’s not enough discussion about why technology pilots in health systems fail. So we appreciated this perspective from Justin R. Brueck at Endeavor Health, on three of the most common reasons he sees things go awry. https://lnkd.in/eKBZ_g2N    • We’re continuing to see stories illustrating both the promise and perils of leveraging generative AI in the practice of clinical medicine. Given the pace of progress, it seems clear that AI will play a significant role in clinical care sooner than later. Lots of thorny questions to work through in a short amount of time. (Here are a couple examples from Yudara Kularathne MD, FAMS(EM) and Graham Walker, MD we appreciated: https://lnkd.in/ePUr2SgE, https://lnkd.in/ej9UpfYg)    • On that note, we’re always interested to read the latest research on how AI solutions are performing in the field. One recent study published in JAMA found that AI scribes significantly reduced time spent in the EHR. Researchers of another, however, cautioned that providers must remain vigilant when using GenAI, based on the fact that Chat-GPT produced different outputs when asked to simplify radiology reports for patients of different races. https://lnkd.in/emNi-_Ai, https://lnkd.in/ejH4KHsq  

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I always read Rock Health's digital health reports as they give a nice pulse feel for what is happening in the digital health funding space. Good to see funds raised in H1 2024 suggest funding in the sector seems to have stabilized at 2023 levels. Its no surprise the report emphasis the buzz around AI and healthcare. There have been clear winners in the AI healthcare space in the area of process and cost optimization and the R&D space. The impact of AI in care and treatment delivery is so far much more muted. One area I never though to look at AI was in its ability to bring together multiple healthcare pathways and digital point solutions into a more holistic seamless experience for the patient. There is a clear trend away from using stand alone digital health point solutions, and could AI address this challenge by facilitating the efficient integration of disparate processes and technology into unified care programs. I can see this happening with digital health products but this will be more tricky to do with physical care programs involving clinicians and HCPs. “AI is helping us combine multiple parts of the care journey, across all care experiences. In the future, benefits navigation, clinical guidance, and care delivery won’t be delivered by separate companies or point solutions within the healthcare ecosystem. They’ll be features that work in concert within products, and they’ll happen in under 90 seconds for a seamless patient experience.” – Glen Tullman, CEO, Transcarent and Managing Partner, 7wireVentures

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🌟 Exciting News! 🌟 We are integrating Digbi Health's precision biology-based programs into Solera's HALO™ platform to holistically tackle cardiometabolic conditions such as obesity, Type 2 Diabetes (T2D), and gastrointestinal (GI) health. Joining Solera Health's elite network of digital solutions enables us to bridge access gaps and transform the lives of even more people. We are proud to be the first company to offer multi-condition support for #obesity, #T2D, and #digestivehealth. Due to GI-based side effects of #GLP1 medications, this capability has become increasingly relevant for payers, employers, and individuals. Our integrated approach ensures personalized care that effectively addresses these interconnected health issues. Digbi Health's precision biology-based care platform goes beyond traditional behavior change programs by addressing the root causes at the biological level. This leads to more sustainable and impactful health outcomes. The partnership makes it easier for employers and health plans to offer this significant innovation in care as part of comprehensive and flexible health solutions. Together, we are pioneering a future where personalized, biology-driven care empowers individuals to achieve their best health. Working with the fantastic Solera team that made this possible was a pleasure. Ed Liebowitz Byron Crowe, Tom Kostecke, Blake Wetherbee WTW Aon Aetna, a CVS Health Company Dexcom Labcorp LG NOVA #genetics #gutmicorbiome Abbott

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Should you sell your practice to a VC-Backed MSO Startup? tldr: - new VC-backed startups are forming MSOs to roll up independent practices - The pitch is physicians receive early liquidity from the roll up and are granted ESOP shares that can be used for retirement - Problem is the use of ESOPs with independent practices is not a new concept and has been used with large group practices since the 70's - ESOPs do not grant full ownership and in order for the shares to be valuable for retirement, the practice needs to run the same if not better post roll up - With VC-backed startups being primarily operated by non-physicians with zero clinical or medical practice experience, the likelihood of this happening is extremely low making the entire concept high risk However, there is a viable path for continued ownership + liquidity for independent practices. Check out the article to learn more. ⤵ https://lnkd.in/gmGvTYwP

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There is an easy way and there is a right way to tackle Direct to Patient / Consumer platforms. Many companies developed, on top of their core offer (e.g. Pharmacy, Telehealth / Virtual Care) an out of the box solution. Companies tend to use these solutions to test the waters, like "is this actually used by patients?" They are but missing a critical point: Patient Engagement is a use-case based job, custom tailored and well monitored for changes. The OOTB solutions do not offer easy customization, nor do they meaningful distinguish between medical use cases. That is the very reason Medlify stays on "pre fabricated modules" which give a fast-access foundation and integrations to a lot of top tier providers in the market, yet offer a fully customizable design system and user flow.

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We're witnessing the next wave of leading companies being within healthcare services & being more "involved" than just writing good code. 🌊 I fundamentally believe it's equally important, understanding on the highest granularity, how healthcare is delivered at the core (in the clinics, hospitals & with doctors). A couple years ago there was a massive focus on digital health, this has shifted to healthcare services, experiencing exponential growth atm, due to the following. 📈 1. Operating within the very heterogenous market of healthcare (in particular primary care) requires to understand and interpret operational nuances (those closest to the problem/market will win) and solve for those very operational topics 🩸 2. Pain to innovate is highest amongst those delivering care, as there is no "continuing as before" (patients jump between services/providers based on availability, that's why digital health only takes off v slowly), doctors can't transition away but are "stuck" with their daily operational problems 😵‍💫 3. Willingness to pay is present, (see point 2.) and doctors can afford to pay for these services (shift from paying for "non-available" staff to software) and lastly it's the largest market (DACH €+550B primary care spend) with everyone being a user at one point, opening up multiple cross revenue streams 💸 4. No payor/insurance fights but a "simple" B2B customer (non of the DTx/reimbursement complexities) and a market with unparalleled retention rates (check CompuGroup revenues over the past 10 years, €1.2B in 2023) ⚔️ 5. Less regulation and increasing emphasis/relaxation on data usage (check Patient Data Protection Act or European Health Data Space) as well as enforced digitalisation throughout the upcoming years (every restaurant needs a modern POS, whilst doctors can still operate pen & paper...) ⚖️ Personally I am very bullish, that within the next 5 years, we'll see the N26/Revolut transformation happening in European healthcare - no flying cars - just better operations, services & experiences on top of existing core medical services. 💯 Thanks for the Eterno Health mention Thomas Hagemeijer - V cool overview! 🙌🏽

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There’s a category we believe is getting too little attention when it comes to AI in healthcare: AI Clinical Documentation Integrity (CDI) While AI ambient scribes and autonomous medical coding solutions have gotten most of the headlines, we’d argue AI CDI is equally impactful when it comes to quality care and accurate billing. For those not familiar, CDI ensures that clinical documentation accurately reflects the patient’s medical condition and the provided care. Historically, CDI was a manual slog, with dedicated CDI specialists, nurses, and physicians painstakingly reviewing patient charts to ensure documentation supported the care delivered. Today, AI is reshaping this landscape. While it’s still early days, we’re seeing three primary approaches to applying AI when it comes to CDI: 1️⃣ CDI + ambient scribing—an AI ambient scribe and AI CDI assistant operate simultaneously, generating comprehensive notes and surfacing codes for physicians to review at the point of care. (Example: Ambience Healthcare’s AutoCDI) 2️⃣ CDI via real-time diagnosis support—diagnoses are suggested at the point of care based on clinical data in the EHR, with auto-generated documentation and audit trails. (Example: Regard) 3️⃣ CDI via an AI-driven post-coding / pre-billing review—the entire patient record is ingested and analyzed against what is coded, surfacing suggestions for revenue and quality opportunities. (Example: SmarterDx) To date, AI in healthcare has focused primarily on administrative use cases. With the increasing adoption of AI CDI solutions, we’re now taking a step closer to clinical workflows. As clinicians get used to AI-suggested diagnoses in the CDI context, it will be interesting to see if this increases their comfort with AI playing a role in clinical care. Here's our working list of AI CDI vendors. Anyone else we should add? • Ambience Healthcare • Brellium • Iodine Software • Regard • Semantic Health • SmarterDx   

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the $2B Change Healthcare fiasco – I hear this mentioned a few times every week. so what went wrong and how did it happen? first, what is Change Healthcare? they’re a healthcare technology giant doing $3B in annual revenue, serving many of the largest hospital systems, insurers, and pharmacies in the USA. UnitedHealth Group, the U.S. Department of Veterans Affairs, and CVS Health are all customers of theirs. so what happened? in May 2023, Change Healthcare disclosed a massive data breach involving an unsecured database containing 𝐬𝐞𝐧𝐬𝐢𝐭𝐢𝐯𝐞 𝐢𝐧𝐟𝐨𝐫𝐦𝐚𝐭𝐢𝐨𝐧 𝐨𝐟 𝐎𝐕𝐄𝐑 𝟐 𝐌𝐈𝐋𝐋𝐈𝐎𝐍 𝐏𝐀𝐓𝐈𝐄𝐍𝐓𝐒. The exposed data included sensitive data like Social Security numbers and dates of birth. The database was left open to the internet without any password protection, allowing unauthorized access for several months before it was discovered and fixed. the total cost of the breach? estimated up to $𝟐 𝐛𝐢𝐥𝐥𝐢𝐨𝐧. and well over a year after the breach, healthcare orgs are still reeling — shoring up their infosec, and reassuring their patients that their data is safe. the Change Healthcare breach is a stark reminder that in the digital age, 𝐝𝐚𝐭𝐚 𝐢𝐬 𝐛𝐨𝐭𝐡 𝐚 𝐯𝐢𝐭𝐚𝐥 𝐚𝐬𝐬𝐞𝐭 𝐚𝐧𝐝 𝐚 𝐦𝐚𝐬𝐬𝐢𝐯𝐞 𝐥𝐢𝐚𝐛𝐢𝐥𝐢𝐭𝐲. as the healthcare industry becomes increasingly data-driven, organizations must prioritize data protection as a core competency, not just an afterthought, or risk facing devastating financial and reputational consequences. to riff on an old programming quip: a few billion dollars can save you an infosec checklist.

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Q1 2024 was big for Digital Health, with $1.1B in VC funding. A large portion came from major deals like $126M for Transcarent and $108.8M for Rightway. Despite some challenges in digital therapeutics and telehealth, investments in general care ($213.4M) and health benefits navigation ($140.7M) are promising. Read what’s driving the shift from direct-to-consumer to enterprise telehealth models here: https://ow.ly/uNYs50SpXGh

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Interesting to see that digital health funding is relatively stable. Only a couple of exits. I think we'll see more deals like DarioHealth's acquisition of Twill, since from a sales perspective, the narrower the solution, the more difficult it is to acquire customers. This difficulty has nothing to do with the quality of offerings, but with the data management and administrative complexity on the customer side.

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