Despite the healthcare industry's focus on transforming primary care delivery, progress has remained slow enough to drive some leaders to tap into the world of venture capital to speed up the pace of innovation, according to a post on Health Affairs Blog.
Looking at public information around three healthcare delivery services backed by venture capital, the post derives some key insights from the for-profit approach:
- The current crop of innovators seem to have gravitated toward a concierge-like reimbursement model, relying on set fees for at least a portion of their income, according to the post. This provides an economic base on which to invest in the patient experience, which can yield benefits to doctors in the form of smaller patient panels and more efficient recordkeeping.
- The companies featured in the post dealt directly with large employers and unions, which quickly yielded a "critical mass" of patients, allowing for further growth and innovation. This approach also provides the companies with a better product offering than they would have under a more traditional concierge model, where the high-touch benefits only accrue to patients who pay extra for them.
- Radical innovation comes at a high price. The companies tracked in the post raised from $20.6 million to $181.5 million to fuel their expansions, and the Health Affairs blog post suggests that kind of money wouldn't be easily available without venture capital financing. Nevertheless, the potential for a better model by which to support growth and innovation in the healthcare space means smaller-scale investors in the public and private space ought to take note, according to the post.
To learn more:
- see the post