Transcarent CEO Glen Tullman

Digital health news doesn’t happen in a vacuum. That’s why we’re excited to announce the launch of DHW’s new “Industry Wire” section, which provides a quick snapshot of the top healthcare stories happening outside of our corner of the market. You can find the Industry Wire at the bottom of each newsletter issue going forward, so scroll on down and get caught up.

Digital Health

Rock Health: H1 Funding Comeback

There’s a comeback brewing for digital health, with Rock Health’s latest funding report showing that the sector is officially on track to beat last year’s investment total.   

US digital health startups raised $5.7 billion across 266 rounds in the first half of 2024, setting a pace that could surpass 2023’s full-year total of $10.7 billion.

Most of the excitement came from early-stage startups. Seed, Series A, and Series B raises accounted for 84% of labeled rounds in H1. The median size of a Series A was $15M (up $3M from last year), driven by big showings from companies like Hippocratic AI and Fabric. 

• Rock Health pointed out that larger Series As have helped AI startups manage costs for training models and acquiring datasets, while also helping others make well-timed M&A (Ex. Fabric’s acquisition of MeMD from Walmart).

Unlabeled rounds started to wane as fewer companies pushed off a valuation haircut or delayed a labeled raise due to not meeting necessary benchmarks. Just 33% of Q2 2024 rounds were unlabeled, down from 47% in Q1 and 55% in Q4 2023.

• This could mark the beginning of a return to a more normal cadence of labeled raises, which Rock Health predicted would be in the cards for 2024.

The most funded value proposition in H1 went to “treatment of disease,” thanks in part to Foodsmart’s $200M raise feeding the $1.1B total. 

• Mental health retained its usual position as the most funded clinical indication, raising $700M as companies like Talkiatry and Brightside managed to attract more investor attention than the surging weight management segment ($300M).

The first half saw three public exits for digital health companies, ending a 21 month drought with stock market debuts for Nuvo (remote fetal monitoring), Tempus AI (precision diagnostics), and Waystar (revenue cycle management).

• Among players still gearing up for an IPO, fewer companies were rounding out their offerings by acquiring the missing pieces, which was chalked up to companies wanting to be conservative with their runway. H1 2024 clocked in at 34 digital health acquisitions, well below half of 2023’s full-year total (83).  

The Takeaway

Resilience seems to be leading to brilliance for digital health founders, with overall funding momentum and fewer transition measures (AKA unlabeled rounds) suggesting the “new normal” is upon us. Although a presidential election and decisions around telehealth flexibilities will have a huge impact on the rest of the year, most signs are pointing toward H2 playing out just as well as the first half.

Glooko Outcomes Using Real-World Data

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The Wire

• HarmonyCares Mega-Round: HarmonyCares locked in $200M to bring its in-home value-based primary care model – which already supports 70k patients in 15 states – to more people across the US. The model establishes close relationships with senior patients to gain a deep understanding of their social and clinical needs, then supports them with a provider group of 175+ PCPs and a team of nurse care managers, social workers, and pharmacists. We’re now up to four nine-figure funding rounds in as many weeks after Sidecar, Foodsmart, and Talkiatry.

• Burnout Improvements: Physician burnout rates dipped below 50% for the first time since the start of the pandemic, according to an AMA survey of over 12k physicians. About 48% of the physicians reported feeling burnout last year, down from 53% in 2022 and a marked improvement from the 63% all-time high notched in 2021. The milestone was attributed to initiatives to improve clinical workflows and physician mental health, but “the fight is far from over.”

• Nabla + Carle Health: Nabla’s ambient AI assistant is rolling out to Illinois-based Carle Health’s multi-specialty physician group following a successful pilot that cut over an hour of documentation time for a majority of participating clinicians across family medicine, pediatrics, cardiology, and other practice areas. A wider implementation through Nabla’s Epic integration is on the docket for later this year, which will bring Nabla Copilot to 1,500 Carle Health providers, including hospitalists and emergency departments. 

• SAIGroup Acquires Get Well: Patient engagement startup Get Well was acquired by private investment firm SAIGroup, joining a portfolio of healthcare companies that also includes ConcertAI (clinical AI and real-world data) and RhythmX AI (gen-AI precision care platform for clinicians). Get Well provides health systems with patient engagement solutions, digital care plans, and navigation tools. The press release makes it clear that AI is core to each of those offerings, and SAIGroup is about to turbocharge them even further with its own Eureka AI platform.

• Mounjaro’s Weight Loss Advantage: We finally have our head-to-head showdown between Ozempic and Mounjaro, which came from their first propensity-matched cohort study in JAMA (hat tip to Dr. Wilson for his great explanation of the study design). Analysis of 18,386 matched patients taking Novo Nordisk’s semaglutide (Ozempic) or Lilly’s tirzepatide (Mounjaro) showed that tirzepatide-takers were far more likely to achieve ≥5%, ≥10%, and ≥15% weight loss within one year (HRs: 1.76, 2.54, 3.24). They also achieved this weight loss far faster. 

• GLP-1s Reduce Cancer Risk: The hottest drug class in the world received more good news when a study in JAMA Network Open showed that GLP-1s were better at mitigating the risk of ten obesity-associated cancers than alternative type 2 diabetes medications. The analysis of over 1.6M T2D patients who were prescribed GLP-1s, insulin, or metformin between 2005 and 2018 found that GLP-1s were more effective than insulin at reducing the risk of cancers in the gallbladder (HR 0.35), pancreas (HR 0.41), ovaries (HR 0.52), and colon (HR 0.54). No decrease in cancer risk was associated with GLP-1s relative to metformin.

• P3 Partners With Innovaccer: P3 Health Partners is partnering with Innovaccer to advance the value-based care capabilities of its clients and improve outcomes for their Medicare patients. P3 was seeking a platform that could unify clinical and claims data from health plans, EHRs, and IT systems to ensure consistent reporting across its regions. It found what it was looking for in Innovaccer’s Healthcare AI Platform, and will be leveraging InNote (EHR-agnostic physician engagement) to close coding and care gaps, as well as Innovaccers population health analytics suite and patient engagement solution.

• Cardiology Deserts: A JACC study found that 46.3% of U.S. counties don’t have a single cardiologist, meaning that the 22M people who live in these “cardiology deserts” have to drive an average of 90 miles round trip to see their cardiologist. Unsurprisingly, patients in no-cardiologist counties had higher cardiovascular mortality rates (281 vs. 269 per 100k adults) and a one year shorter life expectancy. The authors highlight telehealth’s potential to bridge these care gaps, but also endorse incentivizing more clinicians to practice in rural areas.

• UC Davis Deploys Current Health: UC Davis Health is the latest system to deploy Best Buy Health’s home-care platform, Current Health, to remotely monitor patients with high blood pressure and hopefully cut down on readmissions. Patients enrolled in the program will use devices such as blood pressure cuffs and scales that transmit readings to the Current Health platform, which uploads the data to UC Davis’ EHR in real-time so that care teams can respond to issues before they escalate.

• HonorHealth Benefits From AI Adoption: Arizona-based HonorHealth has reportedly raked in upwards of $62M from AI-enabled improvements since integrating its EHR with Qventus in 2021. It sounds like the majority of the benefits stemmed from Qventus allowing Honor to optimize its patients flow, in particular “by addressing the inefficiencies in our patient discharges” to reduce length of stay by 0.65 days. Qventus’ AI also automates outreach to better utilize resources like surgery robots, which led to an additional 3.3 cases per operating room per month.

The State of Payor Enrollment and Credentialing

We’re on the brink of a new era in healthcare. From AI-enabled chatbots to GenAI, Medallion’s latest report sheds light on how healthcare organizations are prioritizing automation, actively shaping their future with it, and hoping it can live up to its promise. Get the full report here.

How Clinicians Became Champions

Nabla CEO Alex LeBrun hopped on the Digital Health Disruptors podcast to share lessons learned during his entrepreneurial evolution from pioneering chatbots to advancing clinical AI. Tune in for tips on how to engage clinicians as advocates for new technology, build trust in AI solutions, and lots more.

Lift MA Plan Performance by Impacting SDoH

Social factors and non-medical issues strongly influence health outcomes, and addressing these contributing determinants of health can not only improve the lives of patients, but also enhance Medicare Advantage plan success. Learn how Clear Arch Health’s remote monitoring services are helping MA plans deliver cost-effective care while enabling more seniors to age independently.

The Industry Wire

1. CMS proposes 2.6% outpatient reimbursement increase.
2. Geisinger data breach may have exposed data from 1.2M patients.
3. Oregon Health & Science University closes telehealth nursing unit.
4. Mount Sinai Health System scrutinized for part-time doctor noncompetes.
5. Bloomberg covers cost of going to Johns Hopkins Medical for most students.
6. FTC slams pharmacy benefits managers.
7. Stanford Health Care becomes out-of-network for Blue Shield of California.
8. Epic adds 356 hospitals in 2023, secures leading EHR share.
9. Judge delays CMS rule limiting compensation for Medicare Advantage brokers.
10. Geisinger details major expansion to Geisinger Medical Center.