Cerebral Raises $300M for Digital Mental Health

Online mental healthcare provider Cerebral announced the close of its $300M Series C round, raising the company’s valuation to $4.8B within two years of its launch.

  • Cerebral is a “one-stop shop” for comprehensive digital mental healthcare and wellness, offering support for depression, anxiety, and post-traumatic stress disorder among other illnesses.
  • Monthly subscription plans give members access to Cerebral’s team of over 2,000 clinicians, lowering barriers to care through its virtual platform combining therapy and medication management for full-service support in the home setting.
  • The funding will be invested in new services such as schizophrenia management expected to launch in 2022, as well as strategic partnerships and international expansion.
  • Advancing partnerships with employers and payors is another priority for the funds, with Cerebral’s new Chief Impact Officer, Simone Biles, enrolling to help on this front after withdrawing from the Tokyo Olympics to focus on her own mental health.

Industry Impact

In-person mental health facilities were heavily impacted by the pandemic, experiencing capacity constraints that frequently led to month-long wait times to see a provider. This created a window for digital providers to address the care gap, with Cerebral reporting that the wait times for its  “instant live” visits are now just over five minutes.

Large amounts of capital continue to be directed towards the mental health space, and more M&A announcements from its well-funded startups are likely to follow as companies like Cerebral aggressively compete for contracts with employers.

SWORD Raises $163M for Virtual MSK Platform

Digital musculoskeletal (MSK) care provider SWORD Health raised a $189m Series D round, making the startup the latest digital health “unicorn” by lifting its valuation to $1.8b.

Based on SWORD’s fundraising pace, it’s safe to say the pandemic has been a boom for virtual MSK solutions. The company closed a $25m Series B in January, followed by an $85m Series C in June, and the recent funding pushed its outside capital total to over $324m.

SWORD offers a suite of personalized MSK solutions that includes:

  • ASK a PT – 24/7 remote access to physical therapists for general questions
  • Digital Guardian – Applies wearables and video monitors to guide safe workouts
  • The Academy – Customized educational content

The virtual-first approach is designed to reduce preventable surgeries for patients while driving value for risk-taking customers such as payors, employers, and health systems.

SWORD CEO Virgilio Bento founded the company in 2015 after seeing first-hand the “challenges that families face when they have to recover a loved one.” The WHO estimates that close to 2 billion people suffer from MSK conditions globally, creating a lot of room for multiple companies to emerge as leaders.

Digital MSK startups have attracted significant investor attention in recent months, with Hinge Health securing $600m to expand its online MSK platform, and Kaia Health raising $75m for its no-hardware-needed rehabilitation programs.

The Takeaway

SWORD prides itself on being “the industry’s only end-to-end digital MSK solution” (but then again, so does Hinge), and it will need to demonstrate that its hybrid approach offers a superior return on investment than competing strategies. If it can accomplish this, then the new funding should give it strong positioning within an MSK market that is quickly establishing itself as one of the top telehealth use cases.

DHW Q&A: The Future of Telehealth With BlueJeans

With Krish Ramakrishnan
BlueJeans by Verizon, Co-Founder and Chief of Innovation

Virtual health continues to be one of the most rapidly evolving landscapes in all of healthcare, with the second year of the pandemic bringing a new set of opportunities and challenges for patients and providers alike.

In this Digital Health Wire Q&A we sat down with the co-founder and chief of innovation at BlueJeans by Verizon, Krish Ramakrishnan, to discuss the changing role of telehealth and the areas where the technology offers the most potential going forward.

BlueJeans was early to the video software space, what led you to found the company?

It’s fair to say that the idea began over ten years ago when we started seeing video overtaking telephony as the future of communication. We saw cloud-based software as a way to democratize video communications back in 2010, allowing us to provide access to anybody, anywhere, at any time.

This was the principle reason behind founding the company and naming it BlueJeans. It’s a universal fabric. Anyone can use it and feel comfortable.

Can you tell us a little bit about BlueJeans and its value proposition?

BlueJeans is a collaboration platform. It enables users to have engaging and secure conversations remotely. Anything you would need from a collaboration platform you can find in BlueJeans: note taking, recording, messaging, and so forth.

The telehealth platform is built on the same BlueJeans architecture. It’s in the cloud, secure, and has all the same fundamentals – but it is purpose built for healthcare. 

What are some features of the telehealth platform that set it apart from a general meetings solution?

Videoconferencing was designed for general meetings, not telehealth specifically, so the original experience was not great in that situation. One of the issues was that you had to download an app. Another was that there was no concept of a virtual “waiting room.” 

When you go to a doctor’s office there’s a waiting room with a check-in and an intake form that allows you to share information and notify the medical staff. All of these things make the experience great, and none of these things are in a “meetings” product.

We saw this as an opportunity. After we eliminated the need to download an app and made sure everything was secure and HIPAA compliant, the next thing we did was build a virtual waiting room.

BlueJeans waiting rooms have all of the features I mentioned that make a good experience. They allow hospitals to customize the look and feel to make sure it’s how they want it, with the right patient education resources readily available.

After that, patients have access to interpreter services, closed captioning, and transcription, all integrated directly into the call.

What are some of the constraints currently holding back telehealth adoption?

One of the biggest constraints is that it’s a new experience, and I’ll give you an example: the introduction of ATM machines.

Banks introduced ATM machines to save time for tellers and provide access to withdrawals 24/7. Now fast forward to today, people rarely go to the bank. Nearly all of the banking that you want to do you can do remotely. This would have been inconceivable back then.

People did not trust ATM machines originally. They wanted to go into the bank and talk to a teller, and to see their withdrawals in person. There was more comfort in the old way of doing things. These days, you only go to the bank if you’re forced to go to the bank. The pendulum has swung the other way.

That’s the journey we’re on with telehealth. Some people will adapt quickly, but some will long for the brick-and-mortar visit. But over time, as technology improves, and more remote patient monitoring gets integrated into care, the need to go to the hospital will diminish. Similar to how the need to go to the bank diminished.

Everything is building towards a telehealth future, and it is going to be the norm, not the exception. 

BlueJeans was acquired by Verizon in 2020, can you share a little about the acquisition? 

We saw an opportunity by partnering with Verizon to make video permeate through more applications outside of meetings. Telehealth was one, education was another, but you need scale to make these use cases a reality.

Verizon brings something that no other partner does: the network. Video requires a network that’s high speed, high capacity, and low latency. With Verizon investing so much in 5G, we thought that a marriage between a video provider, BlueJeans, and a network provider, Verizon, would be a great combination that would enable a better experience.

5G also has certain characteristics that make it useful for telehealth and medical care more broadly. It enables very low latency between action and reaction, and also has very high bandwidth.

I’m really excited to see where this can have an impact in rural health. In these areas, access to expertise isn’t easily available. If we can provide both telehealth and a secure broadband connection, patients will be able to access not only generalists, but also specialists. 5G helps with scarcity, and will help level the playing field between the medical care available in urban areas and rural locations.

How do you see the telehealth space evolving over the next few years?

One area that I think is going to get a lot of attention is elder care and assisted living. The senior demographic is already very large, and is only going to continue growing. Telehealth is going to make it more convenient to provide quality healthcare to seniors, many of whom lack mobility or transportation. It will also help to keep them healthier, because if seniors have to visit a clinic in-person, then their chances of getting an infection are higher.

Our priority at BlueJeans and Verizon is to expand the reach of telehealth. Whether that’s to rural areas or senior communities, many people stand to benefit, and the technology is still in its early stages.

Five years from now, we won’t even call it telehealth, we’ll just call it a doctor’s appointment.

Ro Rumored to Be Acquiring Dadi

Direct-to-consumer health company Ro is rumored to be in talks to acquire at-home sperm storage startup Dadi, according to recent reporting from TechCrunch. 

Ro, which was valued at $5b when it raised a $500m Series D in March, is reportedly pursuing a $100m transaction for the men’s fertility startup, a healthy multiple for a seed-stage company (no pun intended) with $10m in total funding.

  • Dadi provides an at-home fertility test / sperm collection kit, designed to encourage men to become more aware of their reproductive health and contribute to family planning conversations. The company allows men to go from testing to sample storage without stepping foot in a clinic, an approach that could improve the patient experience for a stigmatized issue.
  • Ro has roots in male health, focusing on erectile dysfunction products that still account for half of the company’s revenue. The search for growth beyond its flagship product has led to three acquisitions over the past year, including Workpath (at-home health software), Kit (at-home diagnostic tools), and Modern Fertility (female fertility).
  • While the home-care theme is apparent in the Dadi rumors and Ro’s overall strategy, TechCrunch reports that the rapid pursuit of acquired revenue is leading Ro employees to feel like many of the moves “came out of nowhere” with little integration into the company’s broader business.

Industry Impact

For Ro to overcome its growing pains, it’s aiming to create a more cohesive at-home care platform through acquisitions aligned with that goal, making the Dadi rumors seem more probable than not.

Ro is one of the most valuable privately-owned health tech startups, a title many suspect will change to “publicly-owned health tech startup” through an IPO in the not-too-distant future.

It’s closest competitor, Hims & Hers, recently unveiled a new mobile app to serve as a unified hub for the brand’s telehealth offerings and treatments, and Ro’s fast-paced acquisitions are seemingly positioning the company to pursue a similar long-term care model as it prepares to go public.

Mental Healthcare Demand Pressures Psychologists

Following a pandemic-driven surge in demand for mental healthcare, a new American Psychological Association survey is indicating an even greater demand increase in 2021, with psychologists reporting heavier workloads, longer waitlists, and low capacity for new patients.

The APA surveyed 1,141 doctoral-level active psychologists in the US between August 30 and September 17, providing insights into the evolving mental health landscape in 2021.

Psychologist capacity highlights:

  • 43% reported an increase in overall number of patients (up from 29% last year)
  • 65% reported no capacity for new patients due to current caseload
  • 46% reported feeling burned out (up from 41% last year)

Psychologist telehealth adoption:

  • 96% reported treating patients remotely (slight decrease from 97% last year)
  • 50% reported hybrid in-person / remote treatment (up from 33% hybrid last year)
  • 46% reported seeing all patients remotely (down 64% all remote last year)

Changes in treatment areas:

  • 82% reported an increase in demand for anxiety disorder (up from 72% last year)
  • 70% reported an increase in demand for depression(up from 58% last year)
  • 2021 demand increases for: trauma (58%), substances (27%), sleep (38%)

The Takeaway

More psychologists reported increased demand across all treatment areas than before the pandemic, a trend that has accelerated since last year. While nearly all psychologists are providing remote services to meet rising patient volumes, a growing number of them are still reporting no capacity for new appointments, highlighting a continued need for digital health solutions that address the supply and demand imbalance for the specialty.

Oak Street Acquires Specialty Care Provider RubiconMD

Value-based primary care network Oak Street Health acquired RubiconMD for $130m, adding virtual specialty care to its existing services focused on seniors in the Medicare Advantage population.

  • Oak Street operates by initiating full-risk contracts with Medicare Advantage plans, taking on complete economic responsibility for patients in exchange for per-member, per-month compensation. Oak Street Health currently operates over 100 centers across 18 states and is the only primary care provider endorsed by the AARP. 
  • RubiconMD’s network contains over 230 specialists across all major specialties, with a virtual platform that provides clinical insights on specific patient cases and allows primary care providers to directly manage more of a patient’s care needs.
  • Integrating specialty care into Oak Street’s value-based model will enable it to improve coordination between PCPs and specialists while streamlining operations, an important component to successfully managing a full-risk model.

The Takeaway

RubiconMD was built to support the exact type of health centers managed by Oak Street, and the acquisition provides Oak Street with a proven platform and a large specialist network instead of having to develop both from scratch.

Although Oak Street was an early entrant in the value-based care segment, the RubiconMD acquisition highlights the scale needed to compete for contracts with a limited pool of employers and payors, likely foreshadowing more consolidation on the horizon.

B2C2B as a Digital Health Go-To-Market Strategy

In a recent editorial at MobiHealthNews, Marley Medical CEO Chris Hogg laid out the case for why business-to-consumer-to-business (B2C2B) could be the best future go-to-market strategy for virtual care.

After serving as the CCO of Propeller Health (acquired by ResMed in 2018), Hogg went on to found Marley Medical in August of this year, aiming to help people manage common chronic conditions by taking a new approach to the market.

  • Early digital health companies faced problems fitting innovative products into a lagging reimbursement framework, finding themselves misaligned with existing code descriptors. Without a standard classification, most companies began working directly with payors and employers, offering them services that they could then market to their members (B2B2C).
  • The B2B2C model allows digital health vendors to be compensated by payors in a variety of ways, usually tied to enrollment or engagement. After finalizing the contract with the payor, the vendors begin overcoming implementation challenges and marketing for new members, hurdles that often lead to slow enrollment and limited revenue.
  • Virtual care’s emergence as an effective care delivery method shifts the landscape, allowing digital health startups to classify their products as “traditional clinical services” qualifying for reimbursement. It also allows them to work with and market to individuals while unlocking the ability for payors to compensate them for providing services to their own user base (B2C2B).
  • The B2C2B model gives companies control over user acquisition while enabling their offerings to be subsidized by payors – a compelling go-to-market strategy. The need to directly acquire users causes companies to focus on specific populations and build people-centric products with tangible impacts, as opposed to ones that are easy to market to payors or employers.

The Marley Medical Strategy

In a telehealth playing field that seems to be getting more crowded every day, Marley Medical is looking to set itself apart by focusing its virtual primary care offering on specific populations with chronic disease, engaging directly with patients before working with payors as an in-network provider. With Hogg at the helm and a fresh go-to-market blueprint on its side, Marley Medical is in a good position to show how effective B2C2B can be.

Unsatisfied Patients Turn to the Internet

According to a new study from the AHIMA Foundation and Kelton Global, there is a large disconnect between the information shared by doctors and their patients’ understanding of it.

This communication breakdown leaves patients confused about how to proceed, prompting many to turn to other resources to feel more in control of their health.

  • The survey was distributed to a nationally representative sample of US adults in August 2021 (n=1,059), finding that 76% of Americans “do not leave their doctor’s office on a positive note,” due in part to lacking clear answers to questions (24%) or not having the chance to ask any questions (17%). 
  • After these visits, 62% of Americans are “not extremely confident” in their understanding of information discussed with their doctor, while 15% admit feeling more confused about their health than they did before their appointment.
  • As a result, 80% of Americans research medical recommendations online following an appointment, reporting that they are confident the information on the internet is credible (86%) and that it allows them to feel more confident in their doctor’s recommendations (35%).

The Solution

The researchers conclude that having access to a complete picture of your own health, whether through a doctor’s visit or internet research, is the key to seeing better health outcomes. Most Americans seem to agree, with 81% of survey respondents saying that if they had access to all their health information, such as medical records and test results, they’d see at least one improvement in their health management.

Equum Medical Expands Decentralized Provider Network

Acute care telehealth and tele-ICU provider Equum Medical has been busy. After raising $20m in funding this August, the company has been actively hiring and broadening the reach of its multispecialty clinician teams.

The timing of the moves is not a coincidence. As the pandemic continues to pressure hospital bandwidth and cause burnout among healthcare workers, Equum’s services could be a part of the solution.

  • Equum’s unique approach to care delivery supports health systems with telehealth-enabled physicians working in close proximity to patients. These clinical “pods” allow physicians to build durable relationships with local patients.
  • The company’s goal is to create a critical mass of local physicians and intensivists to provide uninterrupted care for partners, with the nationwide network available as a safeguard during local surges in demand.
  • This allows health systems to fill coverage gaps, reduce the labor load of on-site clinicians, and extend patient care in specialty areas. Equum’s modular services also allow partners to right-size coverage options while keeping their existing tech platforms.

The Takeaway

Unlike in other industries where specialization reigns supreme, health systems have yet to outsource a wide range of functions. With a growing number of “prosumers” taking an active role in their care and demanding more from providers, many hospitals are having difficulty meeting rising expectations.

Equum’s decentralized care framework aims to solve this challenge, not with the standard telehealth playbook, but by bringing its services closer to the people that it serves.

Teladoc Virtual Primary Care Expands Nationwide

Teladoc Health is using its scale to reach the 80% of adults that “do not have a strong relationship with a primary care physician” by making its Primary360 solution available to US commercial health plans, employers, and other benefits sponsors.

Primary360 is a virtual primary care service that Teladoc has been piloting for the past two years. It is already being used by several large companies and will be available to Aetna members early next year.

  • Primary360 allows members to select a primary care provider and develop longitudinal relationships with physician-led care teams. Members receive personalized health plans through Teladoc’s virtual care offerings, and can get help navigating to in-person providers.
  • Data from the pilot shows that two-thirds of members previously lacked traditional primary care and that Primary360 helped members detect undiagnosed chronic diseases. One in four chronic conditions identified for members of the pilot were new diagnoses of common disorders such as diabetes and hypertension.
  • Half of Primary360 members enrolled in the pilot take advantage of at least one other Teladoc product, while nearly 30% use two additional connected services.

The Takeaway

Although Teladoc is positioning Primary360 mainly as a way to make primary care more accessible, it also serves as a way to bring in new business following slowing membership growth as the pandemic wanes. Teladoc is establishing Primary360 as a hub for its full suite of virtual solutions, giving more patients the ability to receive primary care while widening the patient funnel for its other offerings.

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