Short takes: UK’s Cera raises $150M, $105M for Qventus, Solera Health’s $40M; General Catalyst’s AWS deal, Virta Health hits $100M in revenue, powered by GLP-1 maintenance; VirtuAlly’s JC telehealth accreditation

January 16, 2025 | by

A ‘this-n-that’ roundup, with a flurry of fundings and more.

Larger fundings are really swinging it this month, making it feel a little bit like old times:

Cera raises $150 million for UK/NHS expansion, platform AI development, and upscaling. The $150 million funding is split between equity and debt, via lead investors BDT & MSD Partners and Schroders Capitals, plus Earlymarket, Guinness Ventures, DigitalHealth, and Robin Klein, a private UK investors. Cera has raised a total of $407 million, with their last raise of $302 million in 2022. 

Cera supports a spectrum of in-home health through its proprietary AI-assisted carer platform. Their nurses and other staff carers use the app on phones (primarily) to direct care and monitor patients. AI and ML assists enable caregivers to view and react to changes in condition. Families can also view reporting on the app. The company claims results of daily savings of £1 million for the UK healthcare system, hospitalization reductions of up to 70%, a 20% reduction in patient falls, and hospital discharges that are up to five times faster. It supports an estimated 60,000 daily in-person healthcare visits across UK homes, partners with over 150 local governments, and two-thirds of NHS Integrated Care Systems. They also claim to be EBITDA positive (as of 2022) and free-cash-flow positive from last year. TechFundingNews, TechCrunch

Qventus raises $105 million in a Series D. The investment in the care operations and automation platform for over 115 health systems was led by KKR’s Next Generation Technology III Fund with Bessemer Venture Partners plus new strategic investors Northwestern Medicine, HonorHealth, and Allina Health. Qventus claims to be ‘AI-first’ for automating routine care and record tasks, increasing team productivity up to 50%. The new funding will be used to accelerate the development and commercialization of solutions powered by its AI Operational Assistants into new care settings beyond its Surgical Growth and Inpatient Capacity solutions. Total funding to date is $203 million over 10 rounds. Release, MedCityNews

A $40 million round for Solera Health gets them to a Series E. The insider round was co-led by payer group Health Care Service Corporation (HCSC). It also includes investors Adams Street, Cobalt Ventures, and Horizon Mutual Holdings, Inc. Funding to date totals $112 million. Solera’s HALO platform provides access to hundreds of digital health applications for payers and employers, including apps for virtual specialty care in areas such as hypertension, high cholesterol, diabetes prevention, and weight management, to drive down the cost of care. Also announced was the confirmation of interim CEO John Santelli to the position. He joined Solera after nearly 30 years with UnitedHealth Group, departing as CIO. Release, MedCityNews

When giants meet…new AI models follow, with General Catalyst allying with Amazon Web Services (AWS) to develop AI tools for its portfolio companies. The focus will be on cloud services and generative AI using Amazon Bedrock, the ML application for building generative AI on AWS. This will be used for improving predictive analytics around patient treatment outcomes and insights into factors such as disease progression. Also mentioned are tools based on Anthropic and Mistral AI, along with securely trained health care-specific models. 

First up are the expanding Commure and Aidoc. Their specialized technology solutions like Copilot Suite and aiOS will be integrated with AWS’s AI and data capabilities. General Catalyst, besides investing in many healthcare and digital health companies, will be using this for their separate HATco, The Health Assurance Transformation Corporation. HATco was founded in October 2023 to develop an interoperability model for technology solutions, targeting health systems and payers. Mobihealthnews, Yahoo Finance/Global Data, FierceHealthcare

In the hot nexus of diabetes management and weight loss, Virta Health passed the $100 million in revenue threshold and growth of 60%. It’s remarkable given that Virta specializes in reversing Type 2 diabetes and obesity via nutrition modification and lifestyle changes. They’ve tweaked their approach into what happens after GLP-1 patients go off the drug, though they now manage GLP-1 prescribing for health plans, employers, and pharmacy benefit managers (PBMs). Their off-ramp is modeled after their Sustainable Weight Loss solution, Responsible Prescribing is designed as an alternative to GLP-1 drugs or as an off-ramp for patients moving off them to maintain their weight loss. Release

Virtual nursing provider VirtuAlly has received accreditation from The Joint Commission (JC). This relatively rare status for telehealth is based on continuous compliance with performance standards and commitment to providing safe and quality patient care. VirtuAlly provides 24/7 turnkey virtual nurse-patient monitoring, temporary virtual support, and consulting services. They also have added a new term to our lexicon, “tele-sitting”. Release 

News roundup: Owlet’s Dream Sock, BabySat go to market; General Catalyst’s HATco agrees to buy Summa; Cigna’s contrasting provider strategy; new ElliQ robot assistant debuts at CES

January 18, 2024 | by

JP Morgan’s Healthcare Conference (JPM) and CES are as expected big generators of news around digital health–here’s a selection from then and more:

Owlet launches Dream Sock and BabySat at CES. Both were FDA-cleared in November and June 2023 respectively. The Dream Sock baby monitor received first-of-kind de novo clearance for pulse oximetry and sends real-time Health Notifications for low pulse rate, high pulse rate, and low oxygen to parents’ smartphones. Target market is infants 1-18 months and 6 to 30 pounds with direct sale on the Owlet website at $299.

The BabySat is the prescription-only version (left) targeted to infants 1-18 months and 6-30 pounds, but with acute or chronic medical conditions. It also has the unique capability not only to track vital signs but also for the provider to customize alarms for oxygen saturation and pulse rate. Owlet’s BabySat information page explains in plain English the type of medical conditions where the BabySat would be of assistance and the steps to obtain a prescription that is fulfilled through their partner AdaptHealth. A virtual Rx and insurance reimbursement are in the works. A small drawback is that it is only usable with an iPhone. Happily, their stock is also on the rebound at the highest point in six months. Having followed them since the ‘telehealth for the bassinet set’ days of 2012-2013, their continued independence, their rebound from some dark days, as well as their focus on baby health, this Editor continues to wish them bonne chance. Owlet release (via Yahoo Finance).

Big Investor General Catalyst announced their first acquisition move for the Health Assurance Transformation Corporation (HATCo) not at JPM but today (17 Jan). Summa Health is a $1.8 billion (in revenue) non-profit integrated healthcare system headquartered in Akron, Ohio that encompasses hospitals, community medical centers, a health plan, an accountable care organization, a multi-specialty physician organization, medical education, research and the Summa Health Foundation. HATCo’s objective is to transform healthcare towards a goal of “health assurance”, defined as “a more affordable, accessible and proactive system of care” where presumably their extensive experience in investing in healthcare gives them expertise. [TTA 10 Oct 2023] The letter of intent initially sets up a partnership with immediate investment in Summa while due diligence takes place, then when completed moves to a definitive agreement with details of the acquisition and a transaction price in the next few months. Summa would move from a non-profit to a for-profit in becoming a subsidiary of HATCo. According to their information, current management will remain in place.

Summa’s incentive is to stem losses, reportedly at $37 million through Q3 2023, more than double the prior year. HATCo in November stated its desire to buy a health system in Summa’s $1 to $3 billion range. As usual, the buy is subject to regulatory approvals and a final closing date.  HATCo release, Summa Health statement on “our future”, FierceHealthcare

To the contrary, Cigna prefers to partner, not own, healthcare providers. As a payer closer by many degrees to hospitals and practices than General Catalyst, structured much like UnitedHealth Group with Evernorth its counterpart to Optum, they have avoided the aggressive ownership of physician practices. UHG employs about 10%–90,000–physicians through ownership of practices as of December 2023. MedPageToday  At JPM, Cigna CEO Eric Palmer emphasized ‘strategic relationships’ like a minority share of VillageMD (majority owned by Walgreens) in their acquisition of Summit Health, and creating an ‘ecosystem’ that connects to the best partners. Their investments will be wrap-around services in home health, behavioral and virtual care now that a merger with Humana is once again off the table. Becker’s Payer They’ll have some cash to do so; Cigna’s sale of their Medicare Advantage business will likely be to Health Care Service Corporation (HCSC) and fetch $3 to $4 billion. Becker’s Payer

Intuition Robotics debuts ElliQ 3 at CES. An interactive desktop companion robot designed to improve social connection and alleviate loneliness of older adults and those with assistive needs, the new version updates the robot hardware and software capabilities including generative AI capabilities powered by Large Language Model (LLM). The new design from Yves Behar’s design studio, Fuseproject, is also 1.3 pounds lighter and has a 36% smaller footprint which makes it easier to both place and handle, along with a fully integrated screen. Technical improvements include an octa-core SoC and a built-in AI processing unit (APU); 33% more RAM, twice the amount of computing power and memory, and an inclusion of a dual-core AI processing unit (APU), all of which are needed to power generative AI for greater ‘conversant’ capabilities. The LLM technology integrated into the Relationship Orchestration Engine makes real-time decisions regarding actions, scripted conversation, and generative AI conversations. For instance, the person speaking with ElliQ may talk about activities and beliefs, which are stored and classified. In another conversation, ElliQ may use that information to suggest participation in activities and social interactions, while ensuring that the context and flow of conversation is ‘guardrailed’ and appropriate. The AI can also assist the person in activities such as painting or writing poems together.

Current partners include the New York State Office for the Aging, Inclusa (a Humana company), and the Area Agency on Aging of Broward County, as well as newer partners like The Olympic Area Agency on Aging, Ypsilanti Meals on Wheels, and others. Release

Israel-based Intuition Robotics most recently raised $25 million in August 2023 in an unlettered round with $20 million in venture capital plus $5 million in venture debt. TTA 19 Sept 2023

This ‘n’ that: HHS settles *2017* ransomware breach, Carbon Health lays off 114 in restructuring, why oh why VC General Catalyst wants a $3B health system, when Larry Met Billy, a lexicon of workplace terms

November 2, 2023 | by

It only took five years to levy a $100,000 fine. Doctors’ Management Services, a Massachusetts-based medical management company, had a ransomware attack back in 2017 that exposed 206,695 individuals to personal health information violations. The Health and Human Services (HHS) Office for Civil Rights (OCR), which is charged with actually enforcing penalties and remedies for data breaches, decided that Doctors’ management hadn’t done quite enough to protect their patients. The cyberattack was identified in December 2018, but Doctors’ didn’t report the breach to OCR until April 2019. Their network had been infected with GandCrab ransomware. After determining various protection failures, HHS put them on a three-year corrective plan to protect their data and collected the $100,000 fine, their very first. But still, nearly four years later? And with breaches, ransomware, and hacking going on every day?  Healthcare Dive

Another Covid unicorn comes down with a bang. Carbon Health, a 13-state network of primary care clinics along with virtual care in areas such as mental health, says ‘bye’ to 114 or 5% of its staff. It grew and got funded big during Covid as it set up testing and vaccine initiatives, achieving a valuation of $3 billion. In 2021, Covid accounted for 60% of their revenue, but as it waned in 2022, so did their revenue by 23%. To date, their funding has been over $622 million, with $100 million in January in a Series D funded by CVS Health Ventures. This isn’t their first big layoff–200 staffers said goodbye in January as well as 250 in mid-2022 which was about 8%. Becker’s

General Catalyst’s newest venture into Health Transformation Land, HATco, The Health Assurance Transformation Corporation, is in the market for a health system in the “$1 billion to $3 billion” range. Not too small to not have an impact in their communities, and large enough to have capabilities around value-based care plus a track record of excellence. This is to create their ‘blueprint’ for healthcare transformation. Interested parties should contact CEO Marc Harrison, MD. Their other plans to get there were announced at HLTH. As to why…General Catalyst has had a lot of experience with companies, and perhaps they feel they have a Better Way to Get There. Becker’s, TTA 10 Oct.

Of Note…The second wealthiest executive in healthcare, Oracle’s Larry Ellison, wasn’t too busy to hang out with the third wealthiest on Forbes’ list, former senator and HCA honcho Bill Frist, in Nashville at the inaugural Frist Cressey Ventures Forum. Ellison is also investing in a 70-acre, $1.35 billion campus on Nashville’s riverfront. It’s always nice to make nice with the neighbors, especially when they have major holdings in a large health corporation. Becker’s

To wrap up This ‘N’ That, Becker’s has a useful article that will keep you au courant on those workplace terms you see on places like LinkedIn. ‘Quiet quitting’, so popular in 2021-2, has had its day with layoffs leading to real ‘quitting’, leaving behind ‘grumpy stayers’ who try to get away with ‘Bare Minimum Mondays’. ‘Coffee badging’ was a new one on your Editor. The rest are catchy phrases for things as old as time in the workplace.

Olive AI selling rest of business to Waystar Health and Humata Health, winding down: reports (several updates)

October 31, 2023 | by | 3 Comments

The final reorganization is to sell everything. Today’s report in Axios states that Olive AI’s remaining business has been sold to revenue cycle management/payments software Waystar Health and to Humata Health, a startup (see update below). Olive’s Clearinghouse and Patient Access business units went to Waystar and its Prior Authorization business unit to Humata. Sale prices and staff transitions were not disclosed. OliveAI’s business lines centered on automating routine tasks in healthcare so that more time could be spent on patient care and higher value tasks.

Olive’s statement was simple and brief, in part reading “These products represent the heart of Olive’s business and we believe this decision will provide important stability and a bright future for these customers. With the sale of our core business units, Olive will wind down the remainder of its business.” Other than this message, their website was almost totally disabled except for a customer login on a product named Lighthouse. In the message, there is no information on handoffs nor on the fate of remaining staffers.

This follows on our reporting of Olive AI’s slow bleed starting July 2022 when they pink-slipped 450 employees, or one-third of staff, followed by additional layoffs of 35% of staff (215 workers) this past February, then the sale of various businesses to an undisclosed sister company, business intel to BurstIQ, and its utilization management tool to Availity all between February and June. They had a lot to sell in refocusing on core business. Since its founding in 2012, Olive had pivoted its business model 27 times according to its CEO, which sounds to this Editor more like a constant pirouette. The final layoff reported was in July of another 450 staff, another one-third. An Axios report in April 2022 demolished much of their credibility with examples of overpromising on their technology producing savings and efficiencies, then underdelivering, an assessment echoed by KLAS. HISTalk

OliveAI’s demise as it reaches the end of the runway for near-total hull loss is almost in the Theranos class as a Unicorn Fail. They were valued at one point at $4 billion and burned through over $850 million in nine rounds of funding up to a Series H, including from top VCs General Catalyst, Tiger Global, and Vista Equity Partners. General Catalyst is now moving into the transformation business with the awkwardly named HATco,  The Health Assurance Transformation Corporation, announced at HLTH earlier this month and defined as “a more affordable, accessible and proactive system of care”.  As this Editor noted then, HATco’s promise is a song we’re heard before. (The Gimlet Eye would say it should be played on a tinny, out-of-tune piano.)

One of the remaining business buyers, Waystar Health, filed only two weeks ago to be the first IPO in digital health in over a year, for an estimated valuation of $8 billion. Mr. Market’s bad behavior though is delaying its roadshow till December at the earliest due to weakness. The IPO will be 2024. Sometime. [TTA 26 Oct] The cycle begins anew.

Even so, yet another demise of a once-promising company is sad news. This is developing and will be updated.

Update on Humata Health (see comment below). Turns out it is a startup that will be headed by a former Olive president for their payer business, Jeremy Friese, MD. According to his LinkedIn profile, Dr. Friese had that position November 2020 to September 2022 after the sale of Verata Health, where he was co-founder and CEO from 2017 until they sold their prior authorization business to Olive AI. Three former Olive employees contacted the author of Axios’ coverage, Erin Brodwin, after she published the original article on 31 October. So Dr. Friese, who lists a ‘stealth startup’ from April 2023 in his profile, is apparently taking back his prior authorization business. Does this seem reminiscent of Pear Therapeutics’ CEO, Corey McCann, obtaining backing to acquire many of Pear’s assets out of bankruptcy for a paltry $2.03 million [TTA 24 May]?

Was Olive AI a scam? HISTalk has an interesting discussion today on whether it met the definition, as some have claimed. Their POV is that it was not, but investors and customers didn’t do their due diligence despite poor KLAS reviews (except for prior authorization) and especially in the hothouse of 2020-2021 did not see past the hype. For those evaluating companies, whether to take them on as a vendor or to go work for them, there are three cautionary points that stood out in their seven lessons:

  • Companies can be wheezing their last even as they pay big money for impressive exhibits and sponsored events at conferences.
  • Rapid company expansion, acquisitions that look like an attention-diverting shell game, and a product line that is too confusing to summarize in a single “what does your company do” sentence are reasons for skepticism.
  • All companies and investors look smart when the economy is booming.

HISTalk’s Curbside Consult columnist Dr. Jayne takes on Olive AI, which in her health IT world is being much talked about. She and this Editor are on the same page about these running-out-of-funding runway startups which she summarizes so well:

In talking with friends who know the industry well, most are in agreement that it’s time for a lot of companies to pay the proverbial piper since they can’t deliver on the promises they made in exchange for startup funding. They forecast that many more companies will be trying to reinvent themselves over the coming months. Those that are successful may live to fight another day, but others may become the stuff of fire sales or ultimately closures.

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