Sponsored by: Ursa Health
For folks in specialty value-based care, we’re excited to share this opportunity to learn from Dr. David Johnson, Co-Founder and Chief Physician Executive of Atlas Oncology Partners, and Dr. Robin Clarke, CEO of Ursa Health.
We’ll dig into Atlas’ full-risk oncology care model, how they’ve navigated the challenges that have limited success in specialty VBC to date, and the impact of their partnership with Ursa on how they model and manage risk.
With 20+ years of combined VBC experience, expect a deeply nerdy conversation! Learn more and register here.
If you're interested in sponsoring the newsletter, let us know!
MUSING
What is the optimal amount of healthcare fraud?
A formative conversation I had a few years back with a policy-wonk friend about how to account for potential fraud when making healthcare policy decisions. One of the points they made was that when you’re considering big policy decisions, the optimal level of fraud may not actually be zero. In general, the point is that some (low) level of fraud is optimal as a cost of doing business, as the marginal return of eliminating fraud diminishes. Inevitably, as you root out more fraud, you inadvertently curtail good actors in an effort to ensure there are no bad actors.
This isn’t necessarily a popular concept to raise in today’s political discourse, but it has nonetheless been discussed from time to time in various settings like this Bits about Money post. One of the points that Bits about Money post makes that I find intriguing is the idea of trust — that fraud is fundamentally an abuse of trust, and that there is immense social utility we all derive from trusting one another. In the financial world, we’ve all likely benefited from a non-zero fraud world.
I’m reminded of that discussion this week as I watch the latest round of news coming out of the Minnesota Medicaid program. Early in the week, the CEO of YourPath, a startup focused on substance use disorder, posted on LinkedIn about how his startup was denied recertification with Minnesota Medicaid. That was followed by reports noting that the Minnesota Department of Human Services revalidated only 2,061 of 5,583 providers that were deemed high risk. 2,491 of the 3,411 disenrolled providers were due to incomplete/unsubmitted documentation, which tracks with the LI post.
While Minnesota has clearly had issues with fraud in its Medicaid program that have been highlighted nationally over the past few months, I am hard-pressed to think that YourPath is the type of organization we should force to stop providing care because of concerns over fraud. This seems like a fairly predictable side effect of the attempt to eliminate fraud in the Minnesota Medicaid program, as we see what appear to be good actors kicked out alongside fraudulent entities over paperwork issues.
This comes down to a question of trust, and specifically how much we trust these providers to be good actors. Clearly, as Minnesota and other states have demonstrated in recent years, there has been perhaps too much trust in providers being good actors, which has resulted in unacceptably high levels of fraud in various states. This all underscores the societal utility of being able to trust one another. Without that trust, a situation like the one we’re seeing in Minnesota emerges.
I think this is a hard challenge for policymakers to grapple with, particularly at the point we’re at as a society where there is so little trust in our institutions. It moves the allowable amount of fraud closer and closer to zero, as any example of fraud turns into a social media frenzy. It will be worth watching the other side of this play out, as companies like YourPath make their case on social media as well. These are the types of trade-offs that policymakers need to grapple with at a macro level, and they have very tangible consequences for businesses like YourPath, which, unfortunately, become collateral damage in a broader societal fight.
As we appear to be moving towards a more zero-tolerance-for-fraud policy stance generally, it will be interesting to consider the ramifications on many levels, but one I’m particularly interested in is the investability of the Medicaid market. It seems like yet another obstacle for startups and investors in an already challenging market.
CHART OF THE WEEK
The ballooning autism therapy market: a jobs program?
The WSJ was the latest outlet to cover the rapidly increasing costs of the autism therapy market this week. While much of this topic has been discussed previously in terms of the program's rising costs, the chart below was eye-opening about the jobs created by the growth of the autism therapy market.
Source: WSJ article
For anyone looking to make the case that healthcare in this country is fundamentally a jobs program, go ahead and file this graphic away. And If you juxtapose this graphic with the last discussion about the optimal amount of fraud, it’s interesting to ponder how many of these jobs potentially go away in a zero-fraud environment.
DATA TO PONDER
850%
The increase in the number of claims exceeding $3 million over the past decade
BCS, an organization that provides reinsurance products to Blues plans, reported that it has seen an 850% increase in the number of claims exceeding $3 million in its customer Blues plans over the past decade. It attributes the growth to gene therapies, specialty drugs, and complex peds / oncology / cardiac care. Of course, it would be helpful to see the number of claims here, but nonetheless, it provides another indicator of the challenges plans have been facing in recent years.
Key Trends to Keep an Eye On
News items on hot topics we’re tracking in HTN
What sort of healthcare are wealthy people purchasing?
The WSJ real estate section featured two fascinating reads on how New Yorkers are purchasing high-end real estate based on healthcare considerations. Late last week, it described how wealthy seniors are purchasing “med-à-terres,” second homes that are near their specialists of choice at NY health systems. This week, it highlighted how luxury condos in NYC are now incorporating high-end longevity experiences as a selling point for buyers, featuring the Atria Health and Research Institute as an example. If you’re a believer that innovation diffuses like an iPhone — i.e. it starts at a high cost before becoming cheaper over time — I think it’s fascinating to look at what wealthy people are actually purchasing here. Specifically, it doesn’t appear that the technology is the selling point here; rather, they’re buying access to humans and experiences (with technology enabling those).
Legal debates heat up over how to price out-of-network claims
Two legal cases this week were worth highlighting. First, the No Surprises Act litigation continued with Highmark Health suing HaloMD and a provider group for abusing the No Surprises Act IDR process. Also this week, MultiPlan (aka Claritev) and several payers faced a lawsuit in Arizona alleging that MultiPlan’s approach to pricing out-of-network constitutes a payer cartel that systematically underpays Arizona providers and harms consumers.
It all serves as a good reminder of how contentious out-of-network negotiations are when payors and providers have a large pricing gap to solve. When payors contract with a vendor to pay a low rate (MultiPlan), it draws the ire of providers. When providers contract with a vendor to receive a high rate (HaloMD), it draws the ire of payers. Around and around we go.
Another week, another provider-sponsored regional plan struggles
On Tuesday, Presbyterian announced it is exiting the Medicare Advantage market after incurring ~$60 million in losses in 2025, impacting ~30k members. Presbyterian is remaining in the D-SNP market, where it serves 13,000 members today. While broadly, this fits within the trend of regional health plan struggles, staying in the D-SNP market suggests potential in that specific market segment going forward.
Other Headlines
A summary of other key headlines to be aware of
Health Catalyst’s stock jumped ~40% as it divested its Vitalware business for $147 million to RCM vendor Med-Metrix. Health Catalyst will use the proceeds to pay down debt while continuing to hone its strategic focus on building AI capabilities across cost, clinical, and consumer data.
Hazel Health, a school-based telehealth model, is reportedly evaluating strategic alternatives after conducting a sale process with little interest, per Axios. Per Forge data, Hazel Health has raised a total of $273 million since it was founded in 2016.
Hyve, the events business behind HLTH and a number of other events, sold to PE firm Hellman and Friedman for a reported $1.8 billion. Hyve has grown nicely the past few years via acquisitions, including HLTH, after it was acquired by Providence Equity Partners and Searchlight Capital Partners three years ago for sub-£500m.
CMS is moving forward with HealthEdge and Peraton as vendors to replace ClaimsCore, CMS’s claims processing platform. HealthEdge’s contract is potentially worth $1.15 billion, although it is currently committed to only $2.5 million. Bain Capital merged Healthedge with UST HealthProof.
CMS released details on work requirements in an Interim Final Rule, clarifying how they will be implemented under the One Big Beautiful Bill.
The OIG released an audit finding that CMS may have overpaid MA plans by $462 million in 2021 for stroke diagnosis codes not supported by medical records.
Primary care EHR platform Elation acquired Aster, an AI-native EHR for women’s health.
Lumexa Imaging formed a JV with Hospital for Specialty Surgery for outpatient imaging in NYC.
Funding Announcements
Highlighting a few of the most interesting funding rounds from the week
Adaptive Innovations, an AI operating system for home health, raised $60 million across two financing rounds. Felicis and Bain Capital Ventures led the round. Adaptive appears to acquire mom-and-pop home health providers and AI-ify them, improving the financial margins of these practices in the process. It has the most traction in Texas, where it has now completed 100,000+ home visits since it launched in 2025. Per Axios, it has plans to expand to a dozen states with this capital.
Lassie, an AI platform for small businesses, raised $35 million. a16z led the round. Lassie is currently live in over 700 doctors’ offices, with a particular focus on dental practices. Lassie reports that it is on track to hit $100+ million in ARR within one year of launch, signing up practices to five-figure annual contract values. It certainly indicates the appetite for these types of AI-ification approaches.
Ilant Health, a virtual obesity care model, raised $15 million. Cornucopian Capital led the round. Ilant is supporting employers and health plans in balancing the tension in obesity care offerings at the moment, improving clinical outcomes through its care model while also helping keep the total cost of care down.
What I’m Reading
A smattering of other interesting pieces from around the web
Neil Shah shared his perspective on the “hot peptide summer” and how the wellness ecosystem has taken off as people look outside the traditional health system to find the treatments they want. It’s an interesting, quick discussion of the gaps in existing approaches to primary care and how these new models are filling them.
North Carolina released results from its Healthy Opportunities Pilot, a model that used Medicaid funding to pay for services like food, housing, and transportation. It found that the program reduced costs by $164 per person per month. The North Carolina General Assembly opted not to fund the program, so operations are currently suspended.
Featured Jobs
Senior Manager, Policy, at Peterson Center on Healthcare (PCH), a nonprofit healthcare policy and research organization.
$115K - $120K | Hybrid (DC or NYC)
Associate, Assessment, at Peterson Health Technology Institute (PHTI), providing independent evaluations of healthcare technologies.
$75K - $87K | Hybrid (NYC)
Director of Revenue Cycle at Diverge Health, a Medicaid-focused value-based care enabler.
$155K - $165K | Remote
VP, Strategy and Business Development at Virta Health, delivering nutrition-focused metabolic health care.
$243K - $285K | Remote
Manager, Commercial Strategy and Insights at Sollis Health, concierge medicine for urgent and emergency care.
$135K - $170K | Hybrid (NYC)
Contact us to feature roles in our newsletter.
Want to comment or share feedback?
If this newsletter was forwarded to you, subscribe here or see more from Health Tech Nerds.