Cigna put a chunk of new funding on the table Wednesday morning, promising to invest $250 million in innovative startups while providing those startups a business partner to aid their development.
The Bloomfield, Connecticut-based insurer said it's looking for companies delivering solutions in three strategic areas: insights and analytics, digital health and retail, and care delivery and management.
"We're looking at companies that are solving, or attempting to solve, important customer problems, and are doing so in a differentiating manner. There are, unfortunately, a lot of challenges in healthcare, whether it's affordability or complexity or errors," Richards told FierceHealthcare in an interview.
"We're looking for companies that are going to solve part of that—that are going to make things more affordable, that are going to improve the customer experience, that are going to improve quality of health—and those are the ones we want to partner with and invest in," he said.
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Cigna has already funded several capital projects, notably Omada Health for diabetes management and Contessa Health for in-home care delivery. So this new funding arrives alongside a new VC brand, Cigna Ventures, which will oversee and provide a central management structure for Cigna's existing venture projects.
Richards said Omada Health is a model for the kind of startup Cigna wants to fund, particularly emphasizing Omada's focus on customer experience and satisfaction.
"We looked at the healthcare space overall and said, 'Where do we have customers that have problems?' And diabetes is a national—actually it's a global—problem. And so we went to firms that might be able to help along the entire disease progression there," he said. "So Omada is a great example of a company that has leading results in diabetes prevention. We thought their analytics were good, their customer experience was, you know, amazing, and we thought the results were also very very—you know. So we chose to partner with them both on a commercial basis and through the venture investment."
In areas where Cigna Ventures can't find existing startups to work with, it is prepared to launch new startups and programs itself. Either way, the management arm views itself as both a funding resource and consultant base for entrepreneurs who can find promising use cases.
"Cigna is definitely innovating in those areas of focus ourselves, in both large and small ways. So, in our view, Cigna Ventures is just part of our overall innovation in the space," Richards said. "What Cigna really brings to these entrepreneurs, it's not just capital, it's capital and the ability to partner. And a partner could just be some, you know, smart business folks who can look at things and help, and/or it could include, you know, customer relationships, which is exactly what the case was with Omada."
Aside from disease management, Cigna wants to identify partners that have innovative models of care delivery.
That can include emerging provider vehicles like telehealth and remote monitoring, but Richards clarified that it's not looking for technology to replace direct care. It's looking for new ways to provide care—perhaps outside of a hospital setting, like Contessa, which sends medical equipment and staff to a patient's own home.
"I think there's a lot going on in remote monitoring. And I don't know that we're all that interested in investing in devices, but investing in companies that can deliver care—in a more convenient and more affordable location—we're very interested in. And Contessa is a great example of that," he said.