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Q1 Investment Overview, OpenLoop Acquisition, and the 2027 MA Notice
April 9, 2026
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Together with
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“I like to say that we’re really good at addition, but not good at subtraction. When you launch a solution and AI governance approves it, the hypothesis was it was going to do X number of patient encounters and improve productivity… Is it doing that? And let’s be very honest to measure if so. If it isn’t, let’s take it out of our ecosystem.”
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Montefiore Health System CDO Sudipto Srivastava
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Spring is finally here, and Rock Health’s Q1 funding recap shows that the investing landscape is definitely looking greener than last year.
Digital health startups raised $4B on the dot. That’s a whole billion higher than Q1 2025, although the gains were far from evenly distributed.
Here’s Q1 2026 by the numbers:
- Digital health funding totaled $4B across 110 rounds (vs. $3B and 122 rounds last year).
- Average round size climbed to $36.7M (highest since Q4 2021).
- Rock Health counted 12 mega-rounds over $100M.
That last bullet defined the quarter. A dozen companies accounted for 59% of all capital deployed in Q1, one of the highest concentrations Rock Health has ever seen.
- Round sizes have consistently increased every quarter since 2024, and there haven’t been this many nine-figure checks in a quarter since the pandemic peak in 2022.
- Whoop landed $575M at a $10B valuation, Verily raised $300M as it steps out from under Alphabet’s umbrella, and OpenEvidence’s fundraising blitz added another $250M.
The check sizes only tell half the story. One of the reasons why startups are raising bigger late-stage rounds is because they’re waiting longer to go public.
- Hinge and Omada broke the ice, but all it took was a little “geopolitical uncertainty” to spook investors and close the IPO window right behind them.
- If the rest of 2026 pans out like the first quarter, we’d see close to 50 mega-rounds, almost double last year’s count.
AI is now the operating environment. The tech has become so ubiquitous that Rock Health said it will no longer be using “AI-enabled startups” as a distinct category in its funding reports.
- The broader market remains bullish on the value of AI, but if everyone has it then it stops being a differentiator.
- The AI startups successfully raising are the ones moving earliest into complex use cases, like Doctronic’s prescribing pilot in Utah or Qualified Health’s governance platform for health systems.
The Takeaway
Q1 mostly brought more of the same. Investors are active but selective, and the chasm between the Davids and Goliaths isn’t getting any smaller. AI is helping startups move faster than ever, but the rest of the year should help clarify whose momentum is actually durable.
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Virtual-First, Local Always
The humans of healthcare can get lost in the background at conferences full of robo-docs and AI assistants, but deep personal connections are just as key as new technologies for driving better outcomes. Find out how Ovatient is keeping care “virtual-first, local always” in Digital Health Wire’s rapid-fire interview from the ViVE exhibit hall.
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- OpenLoop Acquires Season: Whitelabel telehealth vendor OpenLoop – the same one that powers the world’s first one-man, billion dollar AI startup – acquired food-as-medicine startup Season Health. Nutrition is one of the highest-leverage drivers in addressing chronic care, and Season’s platform covers the clinical workflow from start to finish, with direct chat, goal tracking, recipe recommendations, and DTC meal options built around measurable patient outcomes. It also doesn’t hurt that the acquisition adds hundreds of dietitians to OpenLoop’s provider network.
- Open Evidence Hot Streak: OpenEvidence was on a heater last week after announcing a flurry of new platform enhancements and a major health system partner. It kicked things off by launching Coding Intelligence to give doctors automatic ICD-10 and CPT code recommendations, then immediately followed that up with its first enterprise-wide deployment at Mount Sinai – turns out that direct-to-clinician can get you into health systems after all. The cherry on top was a new partnership with Tandem, which added evidence-based prescribing and prior authorizations to OE’s quickly growing feature set.
- Big Bump for Medicare Advantage: CMS published its 2027 Medicare Advantage and Part D final rule, which lifted MA payments to 2.5% and gives payors $13B more than initially indicated. Outside of that sigh of relief, other key changes included 11 Star Rating measures getting cut, the Health Equity Index reward getting scrapped, IRA Part D redesign getting permanently codified and debit card supplemental benefit guardrails getting added. The rule is effective June 1 and applies to coverage beginning in 2027.
- How Regulators Are Using RWE: The FDA just put out a helpful report on how real-world evidence has been used to support the decisions of medical device regulators. It includes 73 examples of market authorizations using RWE from 2020 to 2025, ranging from Viz.ai’s AI care coordination solutions to Tempus’ AI precision medicine platform. The examples cover a wide span of different clinical and device areas to illustrate the breadth of RWE sources, study designs, and analytical approaches sponsors have used to generate RWE in medical device submissions.
- AssemblyAI Goes Medical Mode: Voice AI infrastructure platform AssemblyAI introduced Medical Mode to deliver top tier accuracy on medical terminology. Medical Mode enhances the recognition of medical entities like drug names, procedures, and clinical terminology while maintaining consistent terminology and formatting throughout the transcript. That allows anyone building healthcare solutions to easily incorporate clinical-grade voice AI capabilities for use cases like ambient documentation or front-office automation.
- Soaring Demand for Behavioral Health: A new analysis from Trilliant Health confirmed that behavioral health demand is skyhigh and only heading higher. Trilliant used national all-payor claims data to examine commercial behavioral health visit volume from 2018 to 2024, finding that there were 1,364 behavioral health visits per 1,000 people in 2024, a 62.6% increase from 2018. The fastest-growing conditions were anxiety disorders (89.3%) and behavioral/emotional disorders like ADHD (51.0%).
- Regard Expands to New Specialties: Regard is expanding its AI platform to cardiology and surgery departments as it looks to bring diagnostic insights to every point of care within the hospital. The platform has historically focused on supporting hospitalists, leveraging AI to review EHR data and recommend diagnoses in real-time while generating draft notes before the physician enters the room. Unlike traditional tools that review what’s already documented or back-end revenue recovery, Regard embeds diagnostic intelligence directly into clinician workflows where they can make the biggest impact on care and quality.
- Eli Lilly Gets GLP-1 Pill Approval: The FDA approved Eli Lilly’s orforglipron, branded as Foundayo, a once-daily GLP-1 pill for chronic weight management in adults with obesity. The approval is the first for a new molecular entity under the FDA’s expedited Commissioner’s National Priority Voucher (CNPV) pilot program. Foundayo also offers a lifestyle advantage over Novo Nordisk’s Wegovy pill, since it can be taken at any time without food or water restrictions. Thanks to the CNPV program, Foundayo is now the fastest-approved molecule since 2002.
- It’s a Journey, Not a Destination: A viewpoint in JMIR Mental Health argues that AI chatbots will only succeed in mental health once they can shift from end points to trajectories. The authors lay out how current AI safety evaluations are fundamentally misaligned with clinical reality, focusing on discrete end points or single-turn replies despite true psychiatric risks often creeping up over time, such as delusional drift or compulsive use. They make the case that AI safety evaluations should attend the conversation as a whole rather than single end points, while also incorporating post-interaction behavior shifts that are frequently overlooked (e.g. sleep or arousal changes).
- Apple Scores FDA Nod for Medical Display: Apple’s new line of high-end displays just received FDA clearance for viewing medical images on the monitors. Apple’s Studio Display XDR monitors are ultra-premium offerings designed for professional use and include DICOM imaging presets for viewing diagnostic images within macOS. The FDA clearance is for Medical Imaging Calibrator, which – in a first for Apple displays – enables the use of Studio Display XDR for general radiology (other than mammography).
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Shape Health AI at DHAI 2026
Mark your calendars. The Digital Health & AI Innovation Summit is bringing together AI leaders from across the industry for a live event in Boston on June 8-9th. This year’s agenda is packed with 150+ speakers and content curated specifically for the pioneers shaping health AI. Reserve your spot for DHAI 2026 today.
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- From Transcription to Clinical Insight in One API: AssemblyAI is the voice platform behind the voice platforms. Combine speech-to-text, PHI redaction, and LLM-powered summarization in a single API call that lets you generate SOAP notes, referral letters, and clinical summaries automatically. Start building with AssemblyAI today.
- Abridge & Availity Redefine Payer-Provider Synergy: Abridge is teaming up with Availity to redefine payer-provider synergy at the point of conversation. The collaboration aligns Abridge’s evidence-aware intelligence with Availity’s real-time health information network to create a first-of-its-kind prior authorization experience, with a shared understanding between patients, providers, and payers. Find out how Abridge and Availity are extending conversational intelligence across the revenue cycle.
- Making the Case for AI: Healthcare organizations have a lot to gain from implementing AI that can enhance coding accuracy and quality metrics, but securing buy-in from leadership is a crucial first step. Check out Navina’s new guide by Dr. Michael S. Barr to see exactly how to demonstrate clear financial benefits, ROI potential, and alignment with organizational priorities to help ensure AI projects are successful.
- State of Payor Enrollment and Credentialing: Over half of provider orgs are losing revenue due to credentialing delays – with many missing out on over $1M annually. Medallion’s new report unpacks the forces quietly undermining operational and financial performance, and how leaders across the industry are addressing them. Head over to the full report to get insights tailored to your role and org type.
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