TTA’s August Ice Cream Run: General Catalyst’s $ for Function Health, GI health is “IT” for Hinge and Throne, EO for AI, DispatchHealth repositions, Health NZ modernizes, Centene’s profit, more!

August 7, 2026 | by

7-10 August 2026

August weather may be ‘dog days’ but in digital health it was an ice cream run, with more to come next week. There was an unusually large General Catalyst debt financing of Function Health’s DTC lab testing subscription model and a lot of ‘movement’ around gastrointestinal health. A Presidential Executive Order on AI governance/cybersec, ATA on the virtual health case, Centene’s cutbacks to profitability, DispatchHealth’s refresh, and health modernizes in the Land of the Kiwi.

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News roundup #2: Function Health’s jumbo $450M raise from General Catalyst, Hinge Health’s $105M Cylinder buy, and Throne Science’s $10M Series A

News roundup #1: AI governance ‘in’ with Feds, ATA; Centene’s shrinking but more profitable future; repositions and partnerships for DispatchHealth, WHOOP; Te Whatu Ora Health New Zealand modernization

Last week’s headlines

The week that was in M&A, financings: Included Health buys Firefly, Candid’s $120M raise, DarioHealth’s $23M RDO, TytoCare’s $25M growth round + new execs, Aurenar’s $5.7M seed for ICU neuromodulation

Chutes & Ladders, Oracle Edition: Surprise! Project Jupiter data center build overages, “social costs” multiply. Pentagon inks $7B, 10 year deal for software.

Catching up to Masimo’s ‘unfinished’ business: Danaher completes $9.9B acquisition of Masimo. $634 million damages from Apple upheld, but Kiani lawsuits continue

Recent Headlines and Must Reads

This week’s Must Read: the dangerous financing of AI data center buildouts–and how they resemble the 2020 health tech boom (Remember the SPAC boom that cracked and left nearly all companies and billions in the dust?)

Chutes & Ladders: Data breach clouts Clover, OpenAI agent escapes sandbox to attack Hugging Face, Precision’s surface BCI achieves thought control, Tempus AI $1.5B Personalis buy, Karoo Health’s $16.2M Series A

News roundup: Withings Medical Group service launches, MPs urge cancellation of NHS/Palantir FDP contract, IKS closes TruBridge buy for $557M, ATA comments on prelim CMS PFS for telehealth, Philips’ AI-powered…toothbrush

A gloomy view on Oracle going forward: debt, cash flow, and dependence on OpenAI

Midjourney Medical audaciously promises a revolution in whole-body scanning, powered by Butterfly Network chips. Can the reality ever match the hype?

Vinegary Must Reads This Week: Silicon Valley’s ‘Cargo Culture’; the clinical query tool explosion between OpenEvidence and general AI

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Telehealth & Telecare Aware – covering news on latest developments in telecare, telehealth and eHealth, worldwide.

News roundup #1: AI governance ‘in’ with Feds, ATA; Centene’s shrinking but more profitable future; repositions and partnerships for DispatchHealth, WHOOP; Te Whatu Ora Health New Zealand modernization

August 6, 2026 | by

Besides data center worries, AI governance and cybersecurity are very near the top of AI concerns.

  • For the Feds, AI is being used to patch up cyber vulnerabilities at speed and scale. The Gold Eagle “Promoting Advanced Artificial Intelligence Innovation and Security” initiative established in Executive Order (EO) 14409 is designed to operate across agency lines, reduce bureaucracy, stimulate innovation, and utilize AI for security as well as develop internal, responsible AI practices. It also promotes cooperation between the private sector and government by being built out by open source software companies, The EO has three major parts: 
    1. Upgrading American Systems for Advanced AI–this sets a 30 day clock from 2 June for adoption across the Committee on National Security Systems, the Departments of War, Homeland Security, Treasury, OMB and others.
    2. Secure Frontier Model Deployment–setting benchmarking, frameworks, “covered frontier models” and partners within 60 days inclusive of confidentiality, cybersecurity, insider-risk, and intellectual-property protection.
    3. Protection Against Criminal Actors–tightening up existing US Code and criminal laws to penalize “anyone who utilizes AI to illegally access or damage a computer without authorization, or who utilizes AI while engaged in such illegal access to further any other crime”.

Healthcare IT News

The American Telemedicine Association (ATA) and its advocacy arm, ATA ACTION, are establishing three working groups to help shape AI governance policy affecting virtual care and telemedicine. The first is on state-level AI policy, the second and third groups are centered on Federal policy agendas, regulations, and how state and Federal governments approach AI in virtual care. The three groups will present their report outcomes in December at the ATA EDGE Policy Conference setting the direction for ATA ACTION’s advocacy priorities in 2027. ATA Release

As payers continue to shrink due to plan membership declines and closures/selloffs, Centene actually is notching some profit and having some sunnier days. Centene’s Q2 closed with a stunning $1.1 billion in profit, with H1 at $2.6 billion, reminiscent of the palmy Michael Neidorff days when the sky was the limit and what was on the ground with the operating plans/companies was a jungle. This was quite a contrast versus 2025’s Q2 $253 million loss and H1  $1.05 billion profit. Revenues were also up nicely with H1 this year at  $103.5 billion, compared to $95.4 billion last year. All exceeded Wall Street estimates and gave Centene the opportunity to boost its 2026 full year outlook to at least $4.80 in earnings per share and revenue to between $193.5 billion to $197.5 billion, a flat-to-boost from 2025’s ending $194.78 billion and $2.08 per share.

At this point, it’s apparent that despite shrinking memberships down to 25.9 million as of Q2, both their sizable Medicaid and ACA plan memberships shrinking sharply, Centene has wrestled that old devil, the Medical Loss Ratio (MLR) to 89.6%, down from 93%. Another bright spot has been their commercial plans which have notched growth and a 10 point less MLR. ACA memberships are down from 5.9 million to 3.5 million. The ACA premium tax credit subsidies expired at the end of 2025, effectively causing premiums to double for nearly everyone. Aetna exited this year and Cigna will be out in 2027.

Share price is also sunny side up. Since April, shares have gone from the $31/share bottom in April to the $60 plus range since June. Centene is reportedly working hard to improve their plan STAR (CMS) and HEDIS (NCQA) ratings.

What is not so sunny is the number of people being shed at Centene. They’ve reported a cut of about 1,200 people as of Q2. It’s unknown how many have accepted the voluntary separation plan (VSP) that was announced in June and deadlined on 27 July. TTA 18 June  Centene reported that they forecast H2 severance costs between roughly $315 million and $365 million. Many of these severances will hit between early September and December, although on the Centene page on The Layoff, some employees accepting the VSP have dates into late 2027.

The VSP is in addition to prior layoffs that took place in H1. Centene reported H1 severance and third-party vendor costs of $61 million, with $47 million hitting in Q2. (This Editor knows a former colleague who was laid off after 16 years in June.) There are also rumors of further layoffs in H2 not part of the VSP as memberships shrink. FierceHealthcare, Becker’s, Centene earnings release

This Editor will reiterate that rarely does shrinking to profitability work except as an interim strategy to stem losses or look better to shareholders. Even with AI tools, operating plans without people on a ‘bare bones’ basis gets plans into quality ratings trouble, the nature of the health plan ‘beast’. That’s even true of commercial plans where employers and third-party brokers shoulder part of the load.

(Disclosure: this Editor was briefly a Centene employee after the company she worked for, WellCare Health Plans, was bought by Centene. She is a holder of Centene stock converted from her prior company. The above is strictly her opinion and protected speech, and should not be used as investment advice.)

DispatchHealth brightly announced what they termed a ‘refined market focus’ and a new website. This terminology means that Dispatch, which was previously known for providing home medical care, recovery services, and hospital-level care at home, now is stating that they are focusing on their B2B health system customers, “offering solutions that empower health systems and risk-bearing providers to build and scale their at-home programs, under their own brands”. Translation: they are now white labeling their CESIA platform and services to health systems to turnkey complex care at home via their workforce. Dispatch merged with Medically Home in June [TTA 21 Mar]. Investment to date has been $733 million through seven rounds (Series E) through 2022, which means that they’ve been paying their own way for some time. Dispatch release

WHOOP continues to “it” up, inking a new partnership in increasingly popular women’s digital health. The Natural Cycles app, which tracks fertility via the menstrual cycle and overnight skin temperature, will integrate with WHOOP’s biometric data collected from their wearable. This past spring, WHOOP definitely whooped it up with a $575 million Series G (for Giant) funding in April and claims 2.5 million members internationally. Natural Cycles has also enjoyed strong funding, including $55 million in a Series C round in 2024,  Mobihealthnews

And flying off way down under to New Zealand, Te Whatu Ora/Health New Zealand has enlisted UCLPartners for tech  modernization. Te Whatu Ora is New Zealand’s largest employer and provides universal health care to 5 million Kiwis. The partnership is for deployment of technology and AI through their digital and AI innovation program, HealthX. In April, they announced that they were working on five initiatives: AI scribes, remote patient monitoring (RPM) for heart failure patients, AI-enabled skin lesion assessments, AI-enabled diagnostics, and CoPilot for leadership and digital services. Health Informatics NZ  UCLPartners is a health innovations developer in care pathways and innovations and workflows. London-based, it works extensively with the National Health Service (NHS). The company worked with Te Whatu Ora on the HealthX AI scribe rollout for horizon scanning work. Healthcare IT News

Short takes: interesting takeaways from the Veradigm earnings call, VA cuts ~6 EHRM contracts; mergers for DispatchHealth-Medically Home, Wysa-April Health

March 21, 2025 | by

The Veradigm earnings call following the 2022 financial release had to be…interesting, perhaps in what wasn’t said. HIStalk’s reporter took away several key points succinctly; a full reading at their site is recommended (scroll down). In brief:

  • “The financial impact of the internal control failures was $239 million in asset reduction and $46 million in fees.”
  • The company will not be current on its financial reporting until 2026
  • The core provider and life sciences businesses went wobbly
  • ScienceIO, bought in February 2024, generated no revenue. The AI/LLM acquisition was touted as being incorporated into other business lines, trimmed with jargon.

The accumulation of things that just aren’t tucked, tied, and moving forward gives the impression of uncertainty. And uncertainty is a bad place to be in a billion-dollar business. Veradigm consists of a complex mix of businesses. Yet the CEO, Tom Langan, is still ‘interim’ after 10 months which affects the leadership. Months ago, the company was for sale, yet all the interested bidders who could have well afforded Veradigm took a pass. Now they are facing a ‘standalone future’.  Right after that announcement, an activist investor intervened and is now calling the shots on board members [TTA 19 Mar, 22 Feb]. Stay tuned….

VA cutting contracts, including six EHRM sub-vendors–a wrench in the EHRM works? According to this Federal News Network report, the total number of canceled contracts, originally announced as 875 contracts, was later reduced to 585. Included in the cuts were at least six small contractors tied into the EHR Modernization (EHRM) with Cerner. While VA is ‘walking back’ the termination of some of these EHRM contractors working on essential pieces such as interoperability and HIPAA compliance, these small, generally veteran-owned companies with specialized workers have already laid off staff. What’s really telling is the statement from FNN’s source, which this Editor doubts you’d hear outside of government or a huge global company: “For every FTE in government, there’s maybe two, three, even four support resources that are assisting. The government is just there for decision-making. The groundwork, and all the other work, is being done by this contract support team. Right now, they’re just trying to do damage control.” In addition, 24 on the EHRM team either were laid off or took the buyout. Having once worked for a contracting RPM company for the Veterans Health Administration which had its contract terminated after over 10 years, this Editor can testify to 1) the devastating effect and 2) the specialized skills of people making up these support teams.  Hmmmm….

Hospital-at-home DispatchHealth and Medically Home to merge, effective mid-year. Terms of the transaction, headquarters location, and employee transitions were not disclosed. According to Healthcare Dive, Jennifer Webster, CEO for DispatchHealth, will lead the combined organization under the DispatchHealth name. Both offer same-day in home medical care, recovery services, and hospital-level care at home. DispatchHealth, headquartered in Denver, raised $403.2 million through a March 2021 Series D. Medically Home in Boston raised $197 million through a January 2022 Series D. They don’t have investors in common, unusually for mergers of late. Medically Home focuses on health systems and physician groups for serious and complex care decentralized management, while DispatchHealth base is with insurance companies, value-based entities, as well as health systems. Coverage for the combined entity is stated as nearly 40 health systems, as well as most major health plans and value-based care entities, with 2,200 employees, over half in frontline care. Release. 

Over in Telemental Health Land, Wysa and April Health are merging. Wysa primarily features an AI LLM chatbot for cognitive behavioral therapy, targeted to individuals and employers, while April Health partners with primary care providers for behavioral care management with live managers. The Wysa chatbot in 2022 received FDA Breakthrough Device Designation for use by patients 18 years old and older with a diagnosis of chronic musculoskeletal pain, depression and anxiety. April Health has already integrated the Wysa chatbot with its services for LifePoint Healthcare and The Newton Clinic (affiliated with MercyOne). Terms of the transaction, headquarters location, and management transitions are not disclosed. Wysa has raised about $35 million in funding, with the last round in 2023, while April Health has seed funding only. Release, Behavioral Health Business, Mobihealthnews 

Short takes: rounding up revenue and acquisition action during JPM

January 14, 2022 | by

The  JP Morgan conference (JPM), which wrapped on Thursday, is traditionally a major venue for healthcare announcements, from revenue to staff to investments. Having never attended but harboring a secret desire to observe (as a poor churchmouse on the wall–no fly am I) the 1% doing their thing, this Editor cannot imagine how boring it must be in virtual format. 

Here are a few highlights: the important, kind of interesting, and not too tedious.

  • Teladoc projects full-year 2021 revenue to hit $2.03 billion, nearly doubling its 2020 revenue. 2022’s projection is about $2.6 billion. It’s revenue without profitability, however. Teladoc lost $84.3 million Q3 2021, which more than doubled its PY $36 million loss. As we noted in our earlier article, Teladoc, like every other telehealth company, saw its shares plummet in 2021 as patients returned to offices and telehealth claims plunged to 4%, mostly for behavioral health. FierceHealthcare
  • Transcarent, Glen Tullman of Livongo’s ‘encore’ company, has landed a $200 million Series C and is now valued at $1.62 billion. Transcarent’s market is self-insured employers and provides a care management model focusing on personalized health and care support for employees. Kinnevik and Human Capital led investors and were joined by Ally Bridge Group, General Catalyst, 7wireVentures, and health systems Northwell Health, Intermountain Healthcare, and Rush University Medical Center. Release
  • Boston-based Medically Home, which supplies hospital-to-home support and integrates technology services, nabbed a $110 million venture round from investors Baxter International Inc., Global Medical Response, Cardinal Health, Mayo Clinic, and Kaiser Permanente. To date, they have worked with 7,000 patients. Release 
  • DexCare, a platform-as-a-service (PaaS) that ‘orchestrates’ digital demand and health system capacity, closed a $50 million Series B funding led by Transformation Capital, with participation from Kaiser Permanente, Providence Ventures, Mass General Brigham, Define Ventures, Frist Cressey Ventures, and SpringRock Ventures. Release
  • Mental health/meditation app provider Headspace Health acquired startup Sayana to build out AI capabilities in mental health and wellness. Its self-care app leverages chat-based sessions with an AI persona. Terms were not disclosed, but Sayana CEO/founder Sergey Fayfer will join Headspace in a product leader role. Headspace acquired rival Ginger back in August [TTA 27 Aug]. FierceHealthcare, release
  • Rival Talkspace is also facing a shareholder lawsuit on securities fraud after going public in a $1.4 billion SPAC deal. According to FierceHealthcare, the charges filed 7 January center on non-disclosure in their financials of critical growth headwinds, including increased advertising and customer acquisition costs and worsening growth and gross margin trends. They also overvalued its accounts receivable from certain health plan clients. Coupled with management turmoil–their president/COO resigned after a ‘conduct’ problem at an offsite event–their share price has plummeted over 80%. Their projection of full-year 2021 revenue was cut to $112 million from $125 million. Talkspace, of course, has said the suit is meritless.
  • Aledade, well known to this Editor as an organizer of accountable care organizations (ACOs) and a management services organization (MSO) for physician groups in value-based care, bought Iris Healthcare. Iris provides advance care and palliative care planning for health plans and providers for seriously ill and high-risk patients via its network of 1,000 independent primary care practices and health centers. It will be folded into their new Aledade Care Solutions unit. FierceHealthcare, release