News roundup #1: UHG-Amedisys extended, NeueHealth going private in NEA’s ‘deal deal’, Commure buying Memora Health, VA resuming Oracle rollouts–now mid-’26

January 8, 2025 | by

The end of year is a favorite time to slip in news that deserves wider notice. Sometimes it’s by design so as not to be noticed…and sometimes it’s timing. Or both. Here’s a potpourri of analyses of late December moves of note.

UnitedHealth Group and Amedisys home health agreed to extend their deal window to 31 December 2025. Amedisys filed regulatory paper on 26 December (file here) that moved the acquisition termination date to end of this year, or alternatively to 10 business days after a final court ruling blocking the merger. The latter is a distinct possibility since the Department of Justice back on 12 November filed a lawsuit to prevent the acquisition [TTA 14 Nov 24] on anti-trust grounds, joined by the attorneys general of four states. Amedisys, a major competitor to UHG/Optum, would be merged into Optum’s existing home health operations.

This long-running acquisition started back in June 2023 as an all-cash deal for $3.3 billion and went into DOJ review by August. The target closing at that time was end of 2024 as both companies knew that divestitures would be necessary. The penalty for non-completion was also upped to $325 million if needed divestitures to the VitalCaring Group proposed last July aren’t completed by 1 May. Even with a new Attorney General coming in after Senate confirmation, the wheels are already in motion for this antitrust action that throws a completion into doubt. Becker’s, Healthcare Dive

Gimlet EyeNeueHealth to be taken private by New Enterprise Associates (NEA) and other investors. The latest episode of the long-running NeueHealth (formerly BrightHealth) show dropped on 23 December. Existing investor NEA and 12 other investors with preferred shares in the company will take it private at an enterprise value of approximately $1.3 billion and roll over their shares for equity in the private company. Other holders of common stock will be cashed out, receiving $7.33 per share, a premium of 70% over the $4.31 closing on 23 December. The final price may change as common shares went up sharply the next day and remain up–today (8 January) opened at $7.49. Closing timing of this ‘deal deal’ is dependent on shareholder and regulatory approvals. Management will remain and roll over their shares into the company. Hercules Capital’s loan facility remains in place.  

Buried in the release is this caveat: “The merger agreement includes a 30-day “go-shop” period that will expire at 12:01 AM New York City time on January 23, 2025, which permits the Special Committee and its financial advisors to solicit and consider alternative acquisition proposals.” These proposals will be kept under wraps. But in this Editor’s view, outside offers are highly unlikely given the company’s death-defying history, continuing losses, and Ticking Time Bombs (see below). Their Q3 results had projected full-year 2024 adjusted EBITDA between $15 million and $25 million–but they lost $40 million in Q3 with the 2024 loss to date over $102 million.

As Ari Gottlieb dryly noted in his LinkedIn post, the company is $1.4 billion in debt. $7.33 per share is quite a comedown from the June 2021 IPO at $18 and an $11 billion valuation. The payout to the 36% of shares held by the other public shareholders is a paltry $21 million. Bottom line–NEA and the preferred investors are buying the company for $21 million–such a deal!

This Editor has previously and Gimletly noted NeueHealth’s high-wire act. It has truly Dodged Disaster with aplomb, skillfully creating its Own New Reality. But its Ticking Time Bombs remain: $300 million in CMS Repayment Agreements due on or before 14 March 2025 and $89 million owed to Texas from last year to cover risk liabilities for its shuttered ACA plans [TTA 14 Feb]. To be continued…   Release, Star-Tribune, FierceHealthcare

Commure bought digital health navigation platform Memora Health. Neither acquisition cost nor management transitions were disclosed on 20 December. Commure has one of the more interesting stories out there as the current company emerged from a General Catalyst-engineered estimated $6 billion merger between Commure and Athelas, with Athelas taking the upper hand in the reorganization [TTA 23 Oct 2024]. It should then be no surprise that Memora has significant investment from General Catalyst, which led its last round of funding in April 2023, making this another investor-arranged deal.

Commure’s primary products are the Strongline duress systems for worker distress and patient elopement and the Patient Keeper EHR, with Athelas in revenue cycle management and sensor-based remote patient monitoring. The combined company now features AI-aided workflows, RCM, duress systems, and a software development platform accessible to outside vendors. What Memora is primarily known for is automating practice follow-up texts before and after procedures. The Memora acquisition is positioned as reinforcing CommureOS’ clinical documentation, RCM, and real-time location services (RTLS). In October, Commure closed their acquisition of Augmedix, an AI-assisted physician scribe used by 20 health systems, for $139 million ($2.39/share), giving it a huge leg up into those providers. Augmedix IPO’d via a SPAC in 2021 at $4/share. About 400,000 physicians are claimed to be users of the Commure suite of products.  Release, Mobihealthnews, Endpoints, FierceHealthcare (Augmedix)

And what end of year would it be without a hopeful note from the VA about the Oracle Cerner rollout–now continuing in mid-2026? The Department of Veterans Affairs (VA) on 20 December officially targeted mid-2026 for four Oracle Cerner implementations, 18 months from now. It’s carefully hedged that they are beginning ‘early-stage planning’ for deployment in four Michigan facilities — Ann Arbor, Battle Creek, Detroit, and Saginaw. Meanwhile, improvements will continue at the five sites that use Oracle Cerner plus the sixth joint implementation with the MHS (Lovell). Interestingly, the current VA secretary, Denis McDonough, announced at an 11 December press conference that new implementations would start before the end of 2025 [TTA 19 Dec 2024]. This Editor assumes that the staff sharpened their pencils and recalculated right before Christmas. What’s also hopeful for Oracle and the VA are continuing  improvements in veteran outpatient trust and clinician satisfaction scores, as well as effectively eliminating outages for 200 days as of the release date. VA release, Healthcare Dive 

Funding/new business roundup: General Catalyst’s HATco ‘health assurance’ venture and $6B portfolio merger, Brightside Health expands, Diana Health’s $34M, Headway’s $125M, Main Street Health’s $315M

October 10, 2023 | by

With HLTH 2023 this week in Las Vegas, there’s the usual deluge of investment and ‘big news’ announcements, both before and during the conference.

HLTH’s Biggest and Somewhat Mystifying News (so far) is that Big Investor General Catalyst now is getting directly into the healthcare transformation business with HATco. The Health Assurance Transformation Corporation is a fully-owned company that will be in the business of “health assurance”, defined as “a more affordable, accessible and proactive system of care” which is a very broad brush indeed that sounds like the promise of value-based care and the Triple Aim (remember?). HATco already claims  20+ health system partners plus a large payer that accounts for about 15% of healthcare revenue and is in 43 states and four countries. They will be building an interoperability model with technology solutions that include a subset of their healthcare portfolio companies to drive this transformation. Their next big step will be actually acquiring and operating a health system to show how this health assurance can work. The new venture will be headed by Dr. Marc Harrison, former CEO of Intermountain Health, with a big assist from managing director Hemant Taneja, who previously founded data OS/EHR/workplace asset tracker and staff safety system Commure. Release, Mobihealthnews, FierceHealthcare 

Speaking of Commure, it is merging with another General Catalyst-funded company, Athelas. It seems like a skillful rationalization of two portfolio companies in health data and workflow data systems, including Commure’s PatientKeeper EHR, with Athela’s addition of revenue cycle management and sensor-based software for remote patient monitoring. The combined entity under the Commure name will be led by Athelas’ CEO and founder Tanay Tandon, with Commure’s CEO Ashwini Zenooz, MD moving into a non-executive director role on Commure’s board. Taneja will retain his executive chairman title. General Catalyst is investing additional funds, valuing it at $6 billion, oddly fanciful given the current environment and their revenue; the current Commure expects to finish the year with $100 million in contracted annual recurring revenue with the combined companies achieving a $125-150 million run rate by end of year. The transaction is expected to close at the end of October. Commure release, Athelas release

Telemental health’s Brightside Health doubles covered lives with additional Medicare and Medicaid beneficiaries. These are from Optum–UnitedHealthcare Medicare Advantage members–plus new and expanded partnerships with Centene, Lucet (to serve Florida Blue members), and Blue Cross and Blue Shield of Texas. This drives up in-network covered lives by 50 million to over 100 million (not actual users). Brightside offers personalized psychiatry, clinically proven therapy and Crisis Care (a program for those with elevated suicide risk) through these plans. Fun fact: based on a Brightside study published in Frontiers in Psychiatry, telemental health is effective for people with reported incomes under $30,000 per year. Healthcare Finance

Diana Health’s $34M Series B to nationally expand women’s health/OB-GYN digital health platform and care teams. Diana partners with health systems to offer women their tech-enabled services in maternity care–preconception and family planning, annual well woman visits, wellness coaching, and virtual and in-person classes and events. Their focus is on improvement of outcomes and women’s satisfaction with maternity care. Diana also has an in-person practice in Smyrna, Tennessee as well as arrangements with health system clinics in Springfield and Cookeville. The funding round was led by Norwest Venture Partners with existing investors .406 Ventures, LRVHealth, and AlleyCorp for a total of $46 million to date. Release, Mobihealthnews, MedCityNews

Telemental health is still simmering with Headway’s $125 million Series C and new unicorn status. Headway, which works exclusively with health plans to provide members with therapy and psychiatry, is now officially a $1 billion+ valued unicorn. This round was led by Spark Capital with Andreessen Horowitz, Accel, and Thrive. GV, which had participated earlier in the $70 million Series B round in May 2021 plus the late 2020 Series A of $26 million, was absent. Funds will be used to go national and equip their providers with new technology and tools. FierceHealthcare, Mobihealthnews

Topping it off, rural health service provider Main Street Health scored a jumbo investment of $315M in new capital. Investors include Oak HC/FT as well as five of the largest national Medicare Advantage plans. Main Street equips rural partner clinics with Health Navigators who assist the clinic’s providers with patient care coordination, such as med pickup reminders, scheduling visits post-hospital discharge, scheduling preventative screenings, and assisting with social determinants of health (SDOH) services. They plan to expand to 26 states from the current 18. A typical clinic is located in a town of 3,000 to 5,000 people and has 2.5 providers, making this additional outsourced service valuable indeed. Release, FierceHealthcare

A short but canny look at consumer behavior as a driver of health technology

February 26, 2019 | by

Whether the global ‘smart home healthcare’ market actually totals $30bn by 2023, as a Research and Markets study trumpets, is debatable, but one thing that this Editor agrees with is that successful home health devices need to take a chapter from Steve Jobs’ Apple and famed industrial designer Raymond Loewy’s playbooks (search our Loewy references here) and design for how the consumer lives and would use their product. It isn’t flashy design awards, but how that technology can not only fit into a person’s life but also be an asset that they’d miss if someone took it away–a point often forgotten in the rush of initial design, testing, and funding.

Writer Scott Thielman of Product Creation Studio, a Seattle-based industrial design and engineering firm, outlines four health tech products/services that represent technology that is intuitive, easy-to-use, accessible, and, I would add, have a little something extra that makes them indispensable.

  • Athelas, a next-generation immune monitoring device that resembles an Amazon Alexa in being a 3D black cylinder. Instead of playing music, it measures neutrophils, lymphocytes, platelets, white blood cells, morphology, and cell activation all within minutes from a test strip inserted in the cylinder. (Investigational device awaiting FDA review)
  • Rochester Institute of Technology (RIT)’s smart toilet seat (which Editor Charles punningly referred to here) was tested with heart failure patients. It measured nine clinically relevant features, including weight, single-lead ECG, systolic/diastolic blood pressure, blood oxygenation and localized pulse timing, and a ballistocardiogram (BCG) for measuring the mechanical forces associated with the cardiac cycle. Normally, the patient would have to use several devices for these measurements rather than taking a seat. Speaking of the seat, it is standard white and replaces the one in the bathroom. Results were published in JMIR mHealth and uHealth.
  • ResMed’s connection of its continuous positive air pressure (CPAP) sleep apnea treatment devices to the cloud before the patient uses them, plus their patient smartphone app helps them to claim that 84 percent of new users reach the necessary usage threshold for Medicare adherence in the first 90 days of treatment.
  • Clarify Medical’s build-in of user feedback for its home vitiligo and psoriasis treatment that goes direct to their in-house customer service also registers patient usage, needed fixes, and outreach to those who need additional coaching and training.
  • Livongo’s acquisition of myStrength’s behavioral health app [TTA 31 Jan] also points to the importance of consumer behavior in a somewhat different aspect–the 20 percent and more who are struggling with behavioral health issues along with one or more chronic conditions managed by Livongo for employers and health plans.

How to design home healthcare devices that people will use (Medical Design & Outsourcing)