Virtue Founder & Investor Sean Doolan 

Rock Health’s funding numbers are all tallied up, and digital health startups hauled in $1B more during the first half of the year than in H1 2025. It was raining mega-rounds yet again, but the real story was how quickly product moats are evaporating.

Thanks for swinging by.
Jason

Digital Health

Rock Health H1 2026: Durable Roots, Shifting Routes

Rock Health just dropped its H1 digital health funding overview, and the halftime report shows a market that knows where it’s going, even if the way it gets there keeps changing.

Here’s H1 2026 by the numbers:

• Digital health startups raised $7.4B across 244 rounds (up $1B from H1 2025).
• Median round size climbed from $12M to $14M, the highest since 2022.
• 19 companies raised 20 mega-rounds, accounting for 45% of all capital invested.

That last stat is starting to look familiar. Capital concentration was the headline of the Q1 report, and the trend hasn’t let up. 

• Just over 8% of rounds absorbed nearly half the capital, and some companies aren’t even waiting a full year between nine-figure checks.

• Garner Health’s $100M Series E landed three months after its Series D, and Aidoc grabbed its second $150M in under a year.

Mental health is still the belle of the ball. It was the top-funded clinical indication for the seventh straight year, led by Talkiatry ($210M) and Grow Therapy ($150M).

• Weight management took the silver on the back of the insatiable appetite for GLP-1s.

• Both categories share a secret weapon: 64% of their H1 raisers go direct-to-consumer, versus 29% of digital health overall.

The IPO drought is creeping back. After seven exits last year, 2026 hasn’t produced a single digital health IPO, and Oura’s S-1 is the only one on file.

• This year’s exit action is all M&A. H1 saw 115 acquisitions, including 71 in Q2 alone (the busiest quarter since 2021), with revenue cycle management consolidating fastest.

Where are all the moats? The H1 report’s big question was what actually counts as a durable advantage now that “we have AI” no longer moves the needle.

Rock Health landed on four answers and one graphic: 

• founders with real domain expertise (sharpens product and buyer relationships)
• platforms scaling to own more workflows (and more context to coordinate tasks)
• hands-on delivery (forward-deployed engineers are officially a healthcare job)
• network effects (every new partnership builds on the last so competitors can’t catch up)

The Takeaway

AI made digital health products easier to build than ever, which means the products themselves are no longer the moat. Investors are looking for the same fundamental roots – teams, trust, and traction – but the routes to find them are shifting faster than ever.

Abridge x Anthropic x Lightspeed Hackathon

Healthcare has always been one of the hardest spaces to build in, but the same complexity that once kept builders away is now what makes it one of the most exciting frontiers in AI. Join Abridge, Anthropic, and Lightspeed for an in-person hackathon in San Francisco this Saturday, July 18, to get hands-on with the technology, constraints, and open problems shaping the next generation of AI in medicine. This weekend’s prompt: Build Agents for Healthcare Clinics. Apply today.

Clinician-First Copilot for Value-Based Success

Navina’s AI copilot brings clinical intelligence directly to care teams, turning fragmented data into actionable insights that transform value-based workflows from the back office to the point-of-care. Designed for and loved by physicians, Navina’s Best in KLAS AI reduces missed diagnoses while improving quality metrics and risk adjustment accuracy. Discover how practices are leveraging Navina to enhance VBC performance and improve the clinician experience.

The Wire

• Withings Medical Debut: Withings is officially breaking into care delivery with the debut of Withings Medical, bringing virtual clinical services to eligible Medicare patients through the new Withings Medical Group. The just-launched ACCESS program will serve as the first proving ground for Withings as it looks to equip patients with its connected devices to help manage conditions related to diabetes, hypertension, and obesity. Dedicated clinical teams at Withings Medical Group will build personalized care plans for each member, prescribe and adjust medications as conditions evolve, and support day-to-day lifestyle change – all integrated with the member’s existing primary care team.

• AI Pressure Points: Heidi’s new Pressure Points report shined a light on how the clinical workforce is using AI, and how it can better support them going forward. The survey of over 1,800 clinicians across 25 countries revealed that 86% now use AI daily or several times a week, and more than half (57%) now call AI a consistent part of how they work. Most clinicians  (83%) are leveraging AI without guidance from their employer or a recommended tool, so it wasn’t too surprising that 68% cited hallucinations and accuracy risk as their top concern with the tools. Other worries included patient privacy (59%), over reliance (47%), and erosion of clinical judgement (41%).

• Peptide Plot Twist: Not so fast, peptide fans. In an unexpected turn, FDA scientists advised against lifting compounding restrictions for seven peptides popular on the black market, citing sparse clinical data. The agency’s compounding committee will still meet next week to vote on expanding access, but approval no longer looks like a shoo-in. Denial would break with the wishes of HHS Secretary RFK Jr., the nation’s peptide promoter-in-chief, and leave a lucrative revenue stream out of reach for compounders and telehealth companies. 

• Anthropic Makes Moves: If the launch of Claude for Healthcare didn’t make it obvious enough, Anthropic is looking to become a mainstay in the medical sphere, and it just inked some major partnerships to make it happen. The first new partner is the largest healthcare company in the U.S., with UnitedHealth subsidiary Optum now leveraging Claude to reduce administrative burden and “make everyday interactions clearer for the people we serve.” Claude is also being embedded into UST’s CarePath claims and care management system, helping scan scattered health data and devise next steps for clinicians.

• Hospital Market Maintains Momentum: Kaufman Hall’s Q2 M&A report revealed the ongoing market rebound hasn’t lost its heat. From April to June, there were a total of 18 transactions, more than double the count from this time last year. This quarter’s transactional revenue of $7.7B was also a big boost from last year’s Q2 low of $1.4B. With two-thirds of deals coming from independent systems seeking proactive partnerships, the lessons of the post-pandemic lull may be sticking around past the rebound.

• Cardiometabolic Care on Wheels: Wheel launched expanded capabilities to enable healthcare organizations looking to participate in Medicare’s evolving programs, including support for ACCESS and a fully-integrated Medicare GLP-1 Bridge program. Activating these new models is no easy lift, but the Wheel Horizon virtual care platform lets orgs launch cardiometabolic care pathways without building clinical operations from scratch – including workflows for everything from eligibility checks and prior auths to pharmacy coordination and adjudication. One of the first customers to go live is also one of the biggest: Walmart 

• Handspring Snaps Up $19M: Handspring secured a $19M Series B to provide the “missing middle” of mental healthcare for kids whose needs go beyond weekly therapy but don’t warrant inpatient treatment. The hands-on service first performs an intake call to check insurance and gather info to match the child with the right therapist. Then, the program moves to 3-6 hours of weekly virtual sessions using evidence-backed methods, including parent coaching. Early data shows Handspring might stick the landing, with 93% of families reporting improvement in their daily life.

• Union Claims AI Job Cuts: A dozen utilization review nurses at Montefiore Medical Center in the Bronx were laid off and replaced by Datavant’s AI-powered software, a clear contract violation according to their union. The hospital disputed those claims without getting into specifics, adding that it’s always investing in new technology. Setting aside the he-said-she-said dynamic, the controversy points to how touchy healthcare AI can be, especially in New York City, where concerns over clinical staff reductions helped animate the recent nurses strike. 

• GLP-1s Can’t Do It All: It turns out that even the drugs that seem to treat everything might not be able to save a marriage. A paper from the National Bureau of Economic Research showed that GLP-1s didn’t benefit mental health, job outcomes, or marital status – areas commonly linked to weight-related bias. Still, the authors emphasize that the data doesn’t mean no non-health benefits exist, just that they may be more subtle, individual, or difficult to measure.

Beyond Weight Loss: How Engagement Drives Employer ROI and Outcomes

Enrollment is the easy part. Nearly every program in the weight management space can point to a solid sign-up number, but the harder question is what keeps members engaged months later. On July 22, Withings Health Solutions, 9amHealth, and Harvard University are hosting a live conversation to answer exactly that. Reserve your spot today to learn about the gap between enrollment and sustained engagement, and what actually closes it.

Execution for Every Workflow

Health systems have no shortage of ideas for improving care and operations. Bunkerhill lets them bring those ideas to life – at scale, across service lines, and around the clock. Discover how the Carebricks platform is empowering clinical and operational teams to deploy AI agents that turn the data they have into the actions they need.

Solving Patient Leakage with Virtual-First Care

Patients expect more from their healthcare – easy self-scheduling, ample availability, and appointments that allow them to get high-quality care wherever and whenever they need it. If your health system isn’t offering that, someone else is. Download the new white paper from Ovatient to see how health systems can look beyond traditional telehealth solutions to deploy an EHR-integrated, virtual-first care model that expands patient access and choice, builds long-lasting care relationships, and reduces leakage.

The Resource Wire

• The AI Hardware Built for Clinical Work: Phones were never meant to be propped on a desk for a 12-hour clinical day. Heidi Remote transcribes patient sessions offline, stores them securely on-device, and syncs to Heidi whenever you’re in range. Just clip on and get to work with the Heidi Remote.

• 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.

• AI That Cares: Healthcare isn’t one-size-fits-all. Your AI shouldn’t be either. Tucuvi works with health systems to deliver personalized care to their unique populations, from routine administrative tasks to the most complex clinical workflows. See why leading healthcare organizations trust Tucuvi to support their care teams.

The Industry Wire

1. Medicare proposal could devastate remote-monitoring industry.
2. OpenAI’s health chief says AI models will get better. 
3. FDA’s CBER seeks stability with “normal” leadership.
4. Why are employees at large companies on Medicaid?  
5. CDC says cyclosporiasis outbreaks in four states may be linked. 
6. Payors file suit against CMS over Medicare Advantage scores. 
7. Which medical specialities are getting happier? 
8. HHS watchdog targets fraud in Medicare, Medicaid. 
9. HCA cuts 2026 forecast as people drop ACA plans.
10. Judge tosses another No Surprises lawsuit against HaloMD.