HTN Weekly Health Tech Reads 9/26

Devoted reportedly raises a massive round, UniteUs acquired NowPow, the OIG looks at MA risk adjustment overpayments, & more!

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  • In a big move in the social determinants of health space, Unite Us is acquiring NowPow. Seems like a good example of the general consolidation happening in the digital health world this year - Unite Us raised a massive round back in March ($150 million), presumably with its VC-backers viewing it as the winner in the SDoH space. Unite Us uses some of that cash to drive growth by acquiring NowPow's customer base. NowPow gets an exit and presumably gets to participate in some of the upside of Unite Us's future growth. Link.
  • Oak Street announced a partnership to be the exclusive Medicare Advantage primary care partner for AARP. This seems like a no brainer for both parties. The challenge for Oak Street is patient acquisition. The challenge for AARP is offering relevant products. Let Oak Street leverage AARP's brand to recruit more seniors, and share in the financial gains. As these primary care models go mainstream, makes sense that we'll see more activity like this. Link.
  • AthenaHealth's investors are reportedly seeking to exit their stake either via IPO or sale at a $20 billion valuation before Q1 of next year. Link.
  • Walgreens announced it is making a $970 million investment for a majority stake in Shields, a specialty pharmacy that works with health systems. The deal values Shields at $2.5 billion, with Walgreens ¬†increasing its position from 23% to 71%. ¬†The article does a nice job outlining Shield's business - it is doing around $2 billion of revenue per year, partnering with 70 health systems across the country to help them deliver specialty pharmacy. Shield's takes 20% - 30% of the health system's specialty pharmacy revenue for its services - sure seems like a nice business to be in. Link.
  • Accolade is launching some new products, getting into the virtual primary care space and taking risk around it. Accolade is referring to the launch as them creating "personalized healthcare" which spawned some interesting discussion in the Slack community this week around what exactly that phrase means, if anything. Link.
  • Welsh Carson is acquiring Argos Health, a revenue cycle company focused on complex claims. Link.


  • Devoted Health is reportedly raising up to $1.2 billion at a $11.5 billion valuation. At roughly 40,000 members, that equates to a mind-boggling $287,000 per member valuation. Remember when less than a year ago I was questioning Clover's valuation at $65,000 per member, while Bright acquired Brand New Day's 43,000 members at $14,600 per member? It's particularly interesting given how the recent crop of public insurers have been hammered by the public markets since IPO. Oscar - down 45%. Bright Health - down 50%. Clover - down 25%. At this valuation, Devoted is worth a few hundred million more than Bright ($5.5b), Oscar ($3.5b), and Clover ($2b) combined. Of course each of those companies has its own set of issues, but it seems like there's a bit of a disconnect here. Presumably Devoted can't be too far off of an IPO with this raise as I can't imagine any other insurer could stomach acquiring it at this valuation. Will be worth watching Devoted's next moves to see how it justifies this valuation to the market versus its comps. Link.
  • Clinical trial platform Elligo raised $135 million. Link.
  • IVX Health, a provider of outpatient infusion centers, raised $100 million. Link.
  • Clever Care Health, a Medicare Advantage insurer, raised $71 million. Clever Care is taking an interesting approach by specifically targeting Asian communities with a plan that is focused on eastern medicine offerings. Link.
  • Pager, a virtual care platform, raised $70 million to expand internationally. Link.
  • Travel nurse staffing platform Nomad Health raised $63 million. It will be curious to see how much this idea improves the nursing shortage versus simply shifts capacity to places that are willing to pay more. Some interesting anecdotes in the Slack on how much traveling nurses are making these days because of the shortages. Link.
  • Centivo, a new health plan for self-funded employers, raised $51 million. Interesting to see that Centivo reports getting 90% of members to select a PCP within two months. Would be curious to know what percent are still with that PCP in a year or two. Link.
  • eVisit, a virtual care platform for hospitals, raised $45 million. Link.
  • Yet another mental health startup raises a big round as Meru Health raised $38 million. Link.
  • NOCD, a telehealth provider for OCD, raised $33 million. Link.
  • Alpha Medical, a virtual primary care model focused on women's health, raised $24 million. Link.
  • Xealth, a platform enabling providers to prescribe digital health apps, raised $24 million. Link.
  • Pearl Health, a startup helping PCPs take risk via Direct Contracting, raised $18 million. Interesting to see the press release articulate the idea much more broadly than just Direct Contracting, particularly versus Pearl's website. Seems like an intentional choice given different audiences for each and the questions around the Direct Contracting program moving forward. Link.
  • Chapter, a next gen Medicare brokerage, raised $17 million. Link.
  • UnifiHealth, a new health plan for small employers, raised $5.4 million. Link.


  • Cedar's CEO penned a blog post this week trying to create a new concept, "compassionate billing". And I gotta admit, I am realllllllllly not a fan of this phrase. On the one hand, I can't disagree that we should treat people with more empathy and to that end, good for Cedar for improving on the status quo of healthcare billing. On the other hand, Cedar's entire business model revolves around making *more* money for health systems, as the blog makes clear. As a thought experiment: imagine if Cedar went to a health system leadership team and said "hey, you should be doing more compassionate billing simply for the good of your community, but you might collect less money from patients." Do you think any health system would actually invest the time and resources to implement Cedar? That's a no from me. So while its nice that our next gen bill collectors are doing so with a smile, they're still in the business of collecting more money from patients on behalf of hospitals. It's a really good business to be in, certainly, but I'd hesitate to refer to it as a bastion of compassion. Link.
  • Clover's president Andrew Toy penned an article with their thoughts on how to "fix" Medicare Advantage. In what appears to be the ultimate "pot, meet kettle" argument, Toy goes straight after the blurring payor-provider relationship between many MA plans and various providers and how those relationships tend to increase costs by leveraging risk adjustment. To be fair, it's hard to disagree with the general thesis. The era of unregulated provider global cap profits in the MA space presumably won't last forever. But it's also interesting to see who this is coming from - keep in mind Clover is an insurance company that got started as a provider sponsored plan and more recently has been pitching free software and talking ad nauseam in its investor materials about how well patients on its software do financially, which at least from an outside perspective appears to be due to... the same misalignment incentives around risk adjustment. Link.
  • Here's an article in STAT news looking at the explosion of interest in health equity from a research perspective, and how academic journals like JAMA are perpetuating inequities by publishing research from white male researchers. Link.


  • The OIG released a brief looking at how some Medicare Advantage payers are driving outsized portions of the $9 billion in annual risk adjustment payments that are made based solely off of chart reviews and health risk assessments. One insurer in particular, which had 22% of MA membership accounted for 40% of the payments, with a particularly heavy concentration of the risk adjustment payments based solely on health risk assessments (they account for 58% of the $2.5 billion of those payments). Note there's only one payer that approaches that level of membership in MA, which is UHG. It's interesting to note that the second largest MA player, Humana, appears to be in the "other 142" companies just based on the membership share numbers. If you're Humana's leadership team, I'm sure you're glad not to be dealing with the public bruising here, but I gotta imagine you're also are looking into why you're not capturing risk adjustment dollars in the same way. It sure seems like a lot of dollars left on the table for your business. If you're interested in the Medicare Advantage space / risk adjustment, this is a must read. Link.
  • The OIG also took a look at the use of telehealth for behavioral health in Medicaid and found that most states haven't evaluated the impact of telehealth use on access and cost. Interesting to note the questions about the impact on cost - if states are reimbursing telehealth at in person rates, it probably doesn't reduce costs. Link.
  • Axios featured an interesting analysis looking at how twenty four health systems with a similar revenue profile in aggregate to UnitedHealth Group actually made significantly more in terms of net profit than UHG in Q2 2021. Of course, this is counter to the general narrative hospitals publicize about how well insurers are doing and poorly hospitals are doing, but it certainly doesn't appear to be the case for the biggest hospitals when looking at net profit. Link.
  • The counterpoint to the Axios argument above comes from the AHA and Kaufmann Foundation, suggesting that hospitals are on track to lose $54 billion of income in 2021. The report unfortunately doesn't include much detail beyond a few summary charts - puzzling to compare and contrast this with the above. Around and around we go. Link.

Featured Jobs:

  • Humana, the large Medicare Advantage insurer, is a hiring Population Health Strategy Lead. Link.
  • IncludeHealth, a startup building a musculoskeletal operating system to empower providers, is hiring a Head of People. Link.
  • Johnson & Johnson's venture arm is hiring a Sr. Manager - Impact Ventures, Investments Lead. Link.
  • Solv, a startup helping patients book same-day appointments with providers, is hiring a Senior Product Manager, Consumer. Link.

Access the HTN Jobs Board for the full list of job postings.