HTN Weekly Health Tech Reads 10/17

Retailers making big healthcare moves - Walgreens announces a new strategy & VillageMD & CareCentrix deals, Best Buy buys Current Health, and Walmart partners with Transcarent


  • Walgreens hosted its investor day and introduced the world to Walgreens Health, a new division designed to house its healthcare assets, including its majority stakes in VillageMD and CareCentrix (more on those below). In their investor day presentation Walgreens suggested its ambitions to take on risk-based contracts, and it sounds like they will continue to bring more care delivery capabilities into the fold to do so. Walgreens is also building out its "Walgreens Health Corner" approach internally, which sound like its version of CVS"s HealthHUBs. Walgreens currently has 40 Health Corners operational. Sure seems like we're going to be talking a lot more about Walgreens over the next few years. It will be curious to see if they follow in CVS's footsteps and start reorienting their entire store footprint around healthcare - the investor deck doesn't make it seem like Walgreens is going that far yet, but it would seem a logical place to go with these activities. The recent chatter that Walgreens was considering acquiring Evolent Health makes more sense in this context, and perhaps is a sign of where Walgreens may look to continue building capabilities. Link (slides). Link (transcript).
  • Walgreens made a $5.2 billion investment in primary care company VillageMD at an implied valuation of ~$16 billion, taking a majority stake in the company by doing so. VillageMD has grown to $1.3 billion of revenue in 2021, with 230 practices across 15 markets. Walgreens / VillageMD currently have 52 co-located clinics open, and intend to have 1,000 opened by 2027. It's interesting to note that VillageMD still intends to go public via IPO in 2022, as Walgreens leadership appears to think VillageMD as a public company is the best way to bring in capital required to support the clinic build out. Link.
  • Walgreens also announced a majority stake in post-acute home health company CareCentrix, with an option to acquire the remaining equity. Walgreens invested $330 million for 55% of CareCentrix. This and VillageMD seem like two very logical assets for Walgreens to build its health ambitions around, although I do wonder about their ability to coordinate care across multiple independent organizations. Between VillageMD, the Walgreens Health Corners, and CareCentrix, you have three actors who all could serve as the navigator / quarterback role. Link.
  • Best Buy made a splash in the remote monitoring space, acquiring Current Health. Current Health, which had just raised $43 million in April, has been building a platform primarily for health systems (including Geisinger, Mt Sinai, and the NHS) to implement remote monitoring systems. It'll be interesting to watch where Best Buy seeks to monetize its healthcare platform moving forward. They appear to have been taking a consumer approach for the past few years, for example with their attempts at building an Assured Living program, targeting adults with aging parents. A natural step for them here would be to start taking a B2B approach, selling their "geek squad"-like abilities to healthcare systems, as Current Health has been doing. Everyone loves the idea of bringing healthcare into the home, but the logistics of doing so are more complicated than might appear at first glance - perhaps Best Buy can build a competency doing this better than others. Link.
  • UnitedHealth Group reported another solid quarter of earnings. There was some good dialogue in the analyst Q&A around UHG's value based care arrangements, particularly the interplay between OptumCare and UHC. Interesting to see UHC mention that those relationships  will expand beyond Medicare Advantage into duals and the commercial insurance market in the future. OptumCare has grown by 250,000 fully-capitated lives this year, which is really impressive scale when comparing it to the scale of other capitated care delivery models. UHG also talked about launching a virtual-first product in 2022, with a virtual PCP directing care for members. UHG expects to price that product at a 15% discount relative to other products. I'd love to see the actuarial assumptions behind that 15% discount - when primary care accounts for only ~5% of spending, it means you assume those plans can take out significant cost elsewhere. Link
  • Walmart and Transcarent announced a partnership to develop an integrated offering for self-insured employers. The partnership seems to make a lot of sense for both sides here. For Transcarent, it's a way to expand their service offering with a partner who has some obvious advantages (i.e. massive footprint, insulin at 75% off of cash-pay prices for branded insulin, etc). For Walmart, it's a go-to-market partner that can help drive volume to Walmart. Seems like a major win for Transcarent in landing this deal as a relatively new company, and provides them with a pathway toward eventually building a TPA / insurance company for employers on top of their platform. Link.


  • Digital care management platform Lark raised $100 million. Link.
  • Lively, a startup creating a modern Health Savings Account, raised $80 million. Link.
  • Sprinter Health, a startup doing in home lab draws, raised $33 million. Link.
  • Oshi Health raised $23 million to build a virtual gastrointestinal practice. Link.
  • Empathy, a startup in the bereavement space, raised $30 million. Link.
  • Minneapolis startup (!!!!!) LifeSpark, a home healthcare startup that recently got into senior living, raised $20 million in a round co-led UCare, a Minnesota-based insurance plan. Link.
  • Marley Medical raised $9 million to build a virtual primary care model for people with chronic conditions. Link.
  • Better Health, a startup selling medical supplies, raised $10 million. Link.
  • ScienceIO, a data startup that is working to turn clinical data from unstructured to structured, raised $8 million. Link.


  • Chris Hogg wrote an article proposing that B2C2B should be the new go-to-market strategy moving forward in digital health. It certainly seems that this will be the dominant strategy for new care delivery startups over the next few years. The question I have is what happens when everyone starts going this direction - it seems like you'll have a lot of startups acquiring members via Facebook and Google, attempting to use that as leverage with payors. I am not convinced those payors are going to be excited to build partnerships with every startup that has a few hundred members in a local market. There was lots of discussion on this article over in the Slack channel, and regardless of how it plays out, it will be interesting to revisit in a few years. Link.
  • It seems like its now once a week that someone is writing about the merits of the Medicare Advantage program. This week John Tozzi at Bloomberg looked at why MedPAC and others are arguing MA potentially increases costs, and focuses organizational efforts on capturing codes rather than delivering care. Opinions on this article are sure to split down what are turning into MA party lines - the for profit insurer / VBC startup community vs the incumbent provider community. Either way, it's hard to read an article like this and think the current state of things will remain for all that much longer. As is becoming a theme in this newsletter, it feels like we're in the early stages of a long-drawn-out battle in DC on this topic. Link.
  • Speaking of the looming MA innovation battle, here is yet another piece, this one in Health Affairs, calling for the MSSP model to be the innovation model of choice moving forward. They suggest moving the Direct Contracting framework under the MSSP umbrella, arguing it would be simpler to do so. It's worth noting that the article was penned by folks from companies in the MSSP space - Aledade, Caravan, and Evolent. Link.
  • This is a good read on one person's thirty-year relationship with their PCP that is now coming to an end as the PCP is retiring. It's worth a read for anyone in the next gen care delivery space to think through what we might be losing as the industry moves away from long-term PCP relationships. The supply / demand issues seem to necessitate us moving away from this model of care, but it sure seems like someone (or something) will need to step into this role of trusted advisor. Who or what that trusted advisor will look like is a good question to be thinking about. Link.


  • The Commonwealth Fund took a look at how Medicare Advantage enrollees compare to traditional Medicare enrollees, finding that there aren't differences across age, race, income, chronic conditions, ability to access care, and satisfaction with care (excluding SNP plans). Link.
  • KFF data found that 7 out of 10 Medicare enrollees don't shop for plan options, and the rates are higher for the populations that might be impacted by plan changes the most - Black, Hispanic, low income, older, and Duals populations are the least likely to shop. A number of startups have recently launched attempting to help people shop for Medicare insurance, seems like a big opportunity to do more. Link.
  • Kaufmann Hall and the AHA released another report supporting hospital M&A.  The report finds that 40% of hospitals are financially distressed at the time of acquisition. The acquisition allows them to better provide services to their communities on an ongoing basis. Link.

Featured Jobs:

  • Bayesian Health, an early stage startup building a clinical AI platform to empower physicians, is hiring a Senior Product Manager. Link.
  • Healthcare Outcomes Performance Company (HOPCo), a physician managed company focused on MSK value-based practice management, is hiring a Market Transformation Analyst. Link.
  • Mayo Clinic, the world renowned hospital system, is hiring a Corporate Development Senior Manager. Link.
  • Oxeon, a healthcare exec search firm / startup venture studio / VC fund, is hiring for its Venture Studio.
  • Redwood Pacific Management, a Silicon Valley multi-family office, is hiring a Healthcare Specialist on its Investment Team. Link.
  • Sitka, a startup building a platform connecting primary care providers with its virtual specialty care network, is hiring a Chief Medical Officer. Link.
  • Tomorrow Health, a home health logistics platform, is hiring a Chief of Staff. Link.

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