What Healthcare Tech Startups Should Know About ACOs

Every week I speak to a healthcare entrepreneur who is building a technology company that will “enhance value-based care” and “improve care coordination”. Shortly after this initial description, the founder typically mentions Accountable Care Organizations (ACOs) as a primary target for their sales strategy. Having worked around ACOs for the past 6 years I’ve always found this particular stakeholder to be an interesting first choice for startups looking for product-market fit. However, these startups are not alone. When I type the phrase, “Care Management” into the business information site Crunchbase, I see 711 results of companies who use that exact terminology in their summary description. “Population Health” has 449 companies and “ACO” has 87 companies. So… instead of having many more calls with founders looking for general advice on how to penetrate the ACO market, I figured I’d just write out some of my thoughts here.

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1

Why the Centene and WellCare Merger is the Biggest Deal in 2020

I feel like the healthcare world just skipped over the $17.3 billion mega-merger between Centene and Wellcare, which just received final regulatory approval last Wednesday. With their powers combined, this new company will create the Thanos of government-focused health plans, hopefully without any of the deranged plans to take over the world. I do get it, 181 million lives are covered by employer-sponsored insurance, between full-risk and self-insured plans. These employer populations have the most disposable income and their HR departments are willing to provide supplemental benefits. However, in my opinion, the future growth of health insurance will be governmental programs like Medicare Advantage (MA), Medicaid managed care, and ACA exchanges. But instead of me telling you this, here is exactly what Centene and WellCare said in a press release to defend the merger:

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Will Medicare Advantage (MA) Startup Plans Be The Future?

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, Healthcare Pizza 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.

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9 Things Every Healthcare Startup Should Know About Business Development

In this edition of Healthcare Pizza, I write down all my strategy and business development knowledge in healthcare and organize it into the top 9 commandments for selling as a healthcare startup. I think everyone from the founder to the most junior person on the team should know these pillars because all startups must grow. I should also note these tenets are most applicable for selling into large enterprise healthcare incumbents (e.g., payers, providers, medical device, drug companies). Although I appreciate the direct-to-consumer game, these slices are less applicable for that domain. If your startup needs help developing or implementing your business development strategy, shoot me an email and we can discuss a potential partnership. Enjoy!

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Is Your Data 11 Times Safer With Your Doctor Than Facebook?

When the Wall Street Journal reported in November that one of the largest health systems in the country, Ascension, was partnering with tech-giant Google to mine patient data, the concerns around patient privacy reached their tipping point. Allegedly named, “Project Nightingale”, the partnership allows Google to aggregate millions of patients health data via medical records (including lab results, medications, and diagnoses) and apply artificial intelligence tools to recommend changes to patient care. This is in addition to Google’s acquisition of Fitbit, which many speculate will be a treasure chest of longitudinal heart and fitness data to unlock, even causing some Fitbit owners to throw away their beloved devices in the name of privacy. For many years now, technologists have claimed the key to unlocking health is commoditizing access to information and letting the machines go to work. For years the public has solely trusted healthcare institutions with their most personal information, but as companies like Google or Facebook  move into the picture, Americans will need to decide who they trust most with their precious data.

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