Cortica, an autism care provider, has clinched $75 million in a series D round.
The round was led by Deerfield Management and Optum Ventures with participation from RA Capital, Echo Health Ventures, Longitude Capital, .406 Ventures, Questa Capital, Ajax Health, Aperture Venture Partners and the Autism Impact Fund. The funding will be used to build out Cortica’s custom tech platform and expand payer partnerships nationally.
The funding round “says a lot about the future of autism care being two things, which is whole-child and value-based,” said Neil Hattangadi, M.D., co-founder and CEO of Cortica. There is growing recognition in healthcare that autism care cannot continue to remain fragmented, he added.
Additionally, Cortica announced it has acquired autism care provider Springtide Child Development in New England and Melmed Center, a developmental pediatrics clinical and research group in Arizona. It has been in clinical trials with both, with more in the pipeline. The two acquisitions bring Cortica’s total integrated autism centers in the U.S. to 23 with 1,600 providers.
"Our entire organization is energized to come together as one company, enabling us to provide even more services and care to those who depend on us as trusted partners," Jia Jia Ye, Springtide's founder and CEO, said in a statement.
"The investment in Cortica and acquisition of our portfolio company Springtide will also accelerate the value-based care agreements that both companies have in the northeast, which lead to better outcomes for children and families and better align incentives across providers and payers," Julian Harris, M.D., operating partner at Deerfield Management Company, said in the announcement.
Cortica physicians will join Springtide centers to offer medical care, while Cortica will deploy counselors, social workers and others to Melmed to support applied behavior analysis and developmental therapies, executives told Fierce Healthcare. Cortica plans to expand its staff in those geographies and until then plans to leverage its telehealth component for patients in need.
Being able to serve patients in-house without referring them out of the community alleviates the burden of navigating the traditionally fragmented care system, Hattangadi said. Clinicians are also happier since they can more easily communicate with each other.
“The clinician experience is one that’s much more cohesive and collaborative as well,” Hattangadi said.
An integrated model also disincentivizes providers from billing based on volume. The consolidation “shows in the level of utilization and claims going to payers coming down significantly,” Hattangadi said.
Springtide and Melmed have been trying to expand for years, but hiring and training the right people for whole-child autism care is often difficult, Hattangadi argues. The right tech platform is also essential, one that can integrate data from each of the care domains. Payer contracting is further complicated by varying plans or carve-outs for behavioral health services.
“Complex care coordination is just harder to build than it might seem,” Hattangadi noted.
“The field really is moving in these two vectors of fragmented to whole-child and fee-for-service to value-based and both of those happening together is really critical," he said.
Whole-child care needs to be reimbursed in the value-based model, Hattangadi concluded. And that care needs to happen in an integrated way with multiple components.