- Investors are pouring millions into companies looking to shake up the way patients go to the doctor’s office.
- Over the past few years, models like venture-backed Iora Health, family-ownedChenMed, and private-equity-backedOak Street Health have picked up steam in their approaches to caring for elderly Americans, boosted by the growth of private Medicare plans.
- At the same time, companies like One Medical have made a name for themselves as a more convenient way to see a doctor for the price of a $200 annual fee.
- Read on to see how each of the startups is shaking up the the traditional way that doctors take care of patients.
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In the past few years a crop of companies has been gaining steam with new approaches toprimary care.
Rather than getting paid for each visit or procedure that a patient needs, startups are looking to change the way primary care is practiced, in many cases working to get paid a large fixed sum each month to take care of all of a patient’s health needs.
In many cases, that means seeing fewer patients a year — hundreds, rather than thousands — offering additional services, or making the process of getting an appointment more convenient.
Read more: A new kind of doctor’s office charges a monthly fee and doesn’t take insurance — and it could be the future of medicine
And others are taking note. For instance, health systems including Utah-based Intermountain Healthcare and Pennsylvania-based Geisingerare taking similar approaches with some of their primary care doctors. The federal government is planning to pay for care for some Medicare patients in a similar way, too.
Venture capital and private equity investors alike have taken an interest in the model, pouring hundreds of millions in funding into some of the companies.
The rise of some of these models — in particular venture-backedIora Health, family-owned ChenMed, and private-equity-backed Oak Street Health — comes at a time when the market for Medicare Advantage plans has grown increasingly competitive.
As of last year, more than 20 million Americanswere enrolled in private Medicare Advantage plans. People can typically choose to enroll in Traditional Medicare or Medicare Advantage plans when they turn 65. Either way, their health needs are largely funded by the US government.
Read on to see how the startups are shaking up the the traditional way we do primary care.
What Iora does: Founded in 2010, Boston-based Iora works with “sponsors” — mainly employers or private health plans for the elderly (known as Medicare Advantage) — that cover a monthly fee for primary care. Iora also built out care teams of nurses and other health professionals that can help the doctors within the practice.
Iora says the approach is working. In one group of Medicare patients, Iora says it reduced hospital admissions by 50% and emergency room visits by 20% over 18 months.
Doctors care for a group of about 500 to 700 patients, depending on where they practice and the health of those patients.
Funding raised: The company has raised more than $250 million from investors like GE Ventures, Khosla Ventures, Temasek Holdings, and Humana.
Number of clinics: Iora currently has more than 30 clinics, and plans to have 50 clinics by the end of 2019.
Read more: A doctor raised more than $250 million to create a new kind of clinic that charges a monthly fee, and it could be the future of medicine
What One Medical does: When San Francisco-based primary care startup One Medical opened for business in 2007, its goal was to upend the way people got medical care by making it easy and convenient to see a doctor. The company charges a $200 annual fee and charges your insurance.
Over the next decade, it became the primary care startup to beat. After a big infusion of capital, it’s expecting to double the number of medical clinics it operates over the next two years. It currently has 72 locations in nine cities, and is increasingly focused on signing up companies to provide care for their workers.
While One Medical does accept some private Medicare plans,it doesn’t take Medicaid, according to its website.
One Medical’s doctors and health professionals are limited to seeing 16 patients a day.
Funding raised: The company raised$220 million in funding in a 2018 round led by The Carlyle Group, according to a spokeswoman for One Medical. In total, she said, the company’s raised $408 million.
Number of clinics: It currently has 72 locations, most recently opening a new clinic in San Diego at the end of July.
Read more: I became a member of One Medical, a primary-care practice that charges a $200 annual fee and has plans to double over the next two years. Here’s what it was like.
What ChenMed does: Miami-based ChenMed was founded 32 years ago by Dr. James Chen. The family-owned organization manages the health of seniors enrolled in Medicare Advantage plans. Under the arrangements, plans pay ChenMed a set amount to keep their members healthy. ChenMed offers services like onsite pharmacies, transportation to and from appointments, exercise options, and social networking with other seniors.
To do that, doctors in ChenMed’s practices typically manage about 300 to 400 patients a year, ChenMed’s chief growth officer Dr. Gaurov Dayal told Business Insider, a much smaller group than the thousands of patients doctors in traditional primary care usually see over the course of a year.
Funding raised: The company is family owned.
Number of clinics: Currently operates more than 60 clinics across 8 states.
Oak Street Health
What Oak Street Health does: Chicago-based Oak Street Health provides primary care to seniors, in particular those who are eligible for both Medicare and Medicaid. It works with Medicare Advantage health plans and those on traditional Medicare to get paid to manage the health of members, by driving them to and from appointments, offering them social events, and more time with their doctors.
Like Iora and ChenMed, Oak Street’s doctors see fewer patients than traditional primary care, caring foraround 500 patients.
Funding raised: Oak Street is backed by private equity giant General Atlantic.
Number of clinics: 45, in the Chicago area, Philadelphia, Cleveland, Detroit, Indiana, Rhode Island, and North Carolina.
What Forward does: For $150 a month, Forward acts as your primary care provider, along with providing some extra perks and technology with the intent to keep you healthier. The company doesn’t take insurance.
Forward’s a type of doctor’s office that’s similar to direct primary care,a small but fast-growing movement of pediatricians, family-medicine physicians, and internists. This group doesn’t accept insurance, and instead charges a monthly membership fee that covers most of what the average patient needs and prescription drugs at much lower prices.
In Forward’s case, membership includes unlimited visits, blood testing, vaccines and genetic testing. The company declined to disclose how many patients each of its doctors sees on average.
Funding raised: Forward declined to comment on the amount it’s raised. As of 2017, it hadreportedly raised $100 million.
Number of clinics: Forward currently has seven clinics, most recently opening one in D.C., as well as spots in southern California, San Francisco, and New York.
Read more: Silicon Valley has a fresh take on a new movement that could be the future of medicine
What Parsley does: Founded by Dr. Robin Berzin in2016, Parsley Health is focused on functional medicine, which takes a more comprehensive approach to treating the underlying cause of a disease, looking at it more holistically than case-by-case.
For a $150 monthly fee, you get primary-care visits, nutrition plans, supplement regimens, and more in-depth genetics and microbiome testing. Parsley does not take insurance.
In early 2019, Parsley started moving into pediatrics, offering similar services at a price of $129 a month, with the hope of providing better care for children and teens with chronic conditions.
A spokeswoman for Parsley said that its doctors max out at a few hundred patients they see per year.
Funding raised: $10 million raised in April 2018.
Number of clinics: Three, based in New York, Los Angeles, and San Francisco
Read more: A doctor’s office that charges a monthly fee and doesn’t take insurance wants to stop the ‘revolving door’ of appointments for sick kids
Summary: Founded by One Medical founder Tom Lee, Galileo Health is a new company that charges an annual fee to provide some care online or through an app.
The cost is $59 for basic services like prescription refills and treatment for simple ailments. Paying $139 a year also gets you doctor consultations for more complex conditions, lab tests, and referrals to specialists, according to Galileo’s website. Right now, it’s available in the New York City area.
The startup plans to have an in-person healthcare component particularly focused on sicker patients covered by Medicare and Medicaid. The company is hiring primary care doctors who have experience caring for patients in those programs, according to job listings.
Funding raised: Galileo is backed by venture firm Oak HC/FT, which led the company’s series A round.
Number of clinics: Virtual for now.
Read more: The founder of One Medical is building a new primary care startup to care for the sickest Americans
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