An Austin, Texas-based startup beat out some of the biggest names in healthcare to win a $1 million government contest testing the use of artificial intelligence.
Now, that company, ClosedLoop.ai, has $34 million in fresh funding to "pursue more problems" plaguing the $4 trillion industry, ClosedLoop co-founder and CEO Andrew Eye told Fierce Healthcare during an interview at the Healthcare Information and Management Systems Society (HIMSS) global conference in Las Vegas last week.
The series B investment round was led by Telstra Ventures with participation from Breyer Capital, Greycroft Ventures, .406 Ventures and Healthfirst. Notable angel investors Adam Boehler, former director of the Centers for Medicare and Medicaid Innovation and CEO of Landmark Health, and Sam Palmisano, former CEO of IBM, also participated in the round.
“ClosedLoopAI is an exciting and important partner in our strategy to develop timely predictive insights through operationalized AI solutions that will drive member engagement and better health outcomes,” said Pat Wang, president and CEO at Healthfirst, New York's largest nonprofit health plan. Healthfirst is both a customer and, now, an investor:
ClosedLoop.ai, founded in 2017, developed "explainable" AI-based solutions that forecast a wide range of outcomes and avoidable adverse events. The company combines an intuitive end-to-end machine learning platform with a comprehensive library of healthcare-specific ML features and model templates.
In April, the company won the $1.6 million CMS AI Health Outcomes Challenge to predict health problems with AI. ClosedLoop beat out more than 300 of the world’s leading technology, healthcare and pharmaceutical organizations including IBM, the Mayo Clinic, Geisinger, Merck, Accenture and Deloitte to win the award.
"The CMS AI Health Outcomes Challenge was focused on explainable AI that physicians trust. And that’s why winning the CMS challenge, and being vetted by the CMS as the No. 1 vendor in explainable AI, is such a big deal," Eye said.
Winning the Medicare challenge gives ClosedLoop's AI solutions "instant credibility" and helps build trust with clinicians, he said.
He added, "It answers a simple question: How do you compare to IBM? The answer is, we beat them. That explainable AI interface, which would take two years of effort, we condensed it down."
According to Eye, ClosedLoop’s explainable AI reimagines the concept of patient risk profiling by shifting away from legacy risk “scores” to comprehensive, personalized forecasts delivered directly into clinical workflows. Each forecast uses patient-specific data and surfaces key variables that explain precisely what risks a patient faces and why. It integrates relevant clinical details and links to specific interventions that clinical teams use to prevent adverse events, improve outcomes and reduce unnecessary costs.
ClosedLoop also integrates its results into clinical workflows to assist with decision-making and patient-physician communication.
The platform’s flexibility allows customers to use AI-based solutions regardless of their in-house data science and ML capabilities. It also provides a large catalog of healthcare ML model templates and prebuilt clinical features to allow organizations without a data science team to build and deploy predictive models better, faster and cheaper, according to Eye.
Healthcare organizations are using AI to prioritize population health outreach, improve clinical documentation and coding, optimize operations and prior authorizations, and improve retention.
"The future of healthcare is going to require AI-based tools. ClosedLoop has a powerful platform for building AI-based healthcare solutions and I believe is positioned to be a leading player in creating AI-enabled healthcare,” said Jim Breyer, founder and CEO of Breyer Capital, in a statement.
In the past two years, the company has helped healthcare organizations impact more than 10 million lives with its open-source COVID-19 index. ClosedLoop has quintupled its revenue and added several national healthcare leaders and partners including Palm Beach ACO and Booz Allen Hamilton.
The promise of AI in healthcare
The latest funding round will fuel ClosedLoop's growth as it pursues more uses cases for its AI solutions, such as predicting a patient's risk of fall-related injuries, opioid abuse and potentially tackling rare diseases.
"The grand vision is that artificial intelligence ought to be applied to every healthcare decision made by every doctor and every patient on the planet every day. But that’s not where we are today," Eye said.
A 20-year tech entrepreneur, Eye founded and sold two technology companies, including mobile software company Boxer (sold to VMWare) and cybersecurity firm Ciphent (acquired by Accuvant, now Optiv). He was motivated to launch ClosedLoop with co-founder Dave DeCaprio after his daughter was diagnosed with autoimmune hepatitis, a rare condition that affects 2,000 people a year.
"We waited three weeks to finally get a diagnose of what was wrong. We found out that in pediatric liver failure, with kids who get liver transplants, in 50% of cases, they never have a diagnosis. The child gets a liver transplant and they don’t know why. And in 15% of cases, they never run an autoimmune hepatitis test," Eye said. "We were two weeks out from a liver transplant, when we got the right answer: Take some prednisone."
"It was a situation of right test, right time, and that’s the use case I want to work on eventually. But there is not enough financial incentive in that use case for the market to adopt it. You don’t get to work on that problem until you go after the big ones first," he said.
Unnecessary healthcare spending is squarely in ClosedLoop’s crosshairs. Today, U.S. healthcare commands a level of spending that is unsustainable at $4 trillion, with a staggering 25% of it wasted.
“There's an opportunity to look at all that inefficient, ineffective care and say, 'Can we do better?'" Eye said. "We need healthcare to be as good at using data to drive patient outcomes as the social networks are at getting us to click ads."