Hospitals invest in venture capital fund to spur R&D

Three leading hospital companies and two major hospital systems are investing in a new venture capital fund focused on research and development to improve healthcare delivery, Tennessee-based Community Health Systems announced yesterday.

Along with Community Health, LifePoint Hospitals, Vanguard Health Systems, Iowa Health System and Trinity Health--representing more than 400 hospitals nationwide--will invest at least $10 million in Heritage Healthcare Innovation Fund LP, reports The Tennessean.

The venture capital fund will "seek, fund and mentor" innovative businesses that provide improved quality of care, service and efficiency for the healthcare industry.

According to the five hospital investors, the Heritage Healthcare Innovation Fund will connect inventive ideas with the funds necessary to create realistic results. In addition to investing up to $10 million in early- and growth-stage healthcare businesses, the fund also will develop companies designed to solve problems faced by hospitals--particularly those related to healthcare reform.

In particular, the fund plans to target healthcare information technology for investment opportunities, notes The Tennessean.

"The structure of the fund is designed to create a close working relationship with innovators, offering them real-time feedback and mentoring to develop truly practical solutions to the real challenges we face today," said Trinity Health President CEO Joseph R. Swedish in a statement.

For more:
- here's The Tennessean article
- read the Community Health Systems press release