There has been an explosion of artificial intelligence solutions in healthcare. But too many healthcare AI companies are what entrepreneur Sean Lane, the CEO of startup Olive, calls a "brain in a jar."
"You get these fancy algorithms and predictive analytics but there’s no action that can be taken," Lane told Fierce Healthcare.
Lane's background is not in healthcare. He was an intelligence officer in the Air Force and spent most of his early career at the National Security Agency. As a technologist in the intelligence field, he understood the importance of actionable intelligence.
In early 2017, Lane and his team launched Olive as an AI-enabled robotic process automation solution. The idea was to do the high-volume, repetitive and manual tasks that healthcare workers do every day—tasks like prior authorization and benefits verification—but to do it faster and more accurately.
"We called it 'blue-collar AI' for a while. We wanted to put our AI to work. If it’s not working for you, taking over a task and creating efficiencies and reducing costs, then it’s just a brain in a jar," he said. Olive can log in to existing technology systems, like electronic health records, and can take over administrative tasks, he said.
Health systems are using Olive in operational areas like revenue cycle management, finance, accounting, supply chain, human resources and IT.
Lane officially started the company in 2012 after he sold another software startup in the defense industry. Around the same time, his hometown in southeastern Ohio was having growing problems with prescription drug abuse. "That pulled me into healthcare. I wanted to help solve a lot of the problems that exist, prescription drug abuse as one of them, as well as administrative costs and the lack of connectivity between systems," he said.
It took four years of research and development before Lane and his team developed Olive, which the company bills as a digital employee.
The Columbus, Ohio-based company has drawn interest from health system customers and the investor community. Olive has raised $72.8 million in five funding rounds to date, according to Crunchbase. That includes a $32.8 million Series D round in June 2018 led by Oak HC/FT and Ascension Ventures, the investment arm of Ascension. Existing investors also participated.
The investment went toward investing in new capabilities such as a process mining tool called Pupil. The company launched that tool at alpha sites last summer. In the first five months of 2019, the company also hired 100 new team members, bringing its total workforce to 160.
The company's list of health system customers has grown rapidly with Yale New Haven Health in Connecticut and Colorado-based health system Centura Health among its lastest customers. Olive now works with 500 hospitals and is on pace to triple its business this year, Lane said.
Sharlene Seidman, vice president of patient financial services at Yale New Haven Health, said the health system plans to use Olive to automate the prior authorization process "We believe our people are the pivotal component to providing the best patient financial experience. That’s why we embrace innovation to remove transaction-based work," Seidman said in a statement. She noted that AI is poised to make a significant positive impact at YNHH and on the industry as a whole.
Olive's growth coincides with interest in AI and robotic process automation to improve the operational side of the healthcare business and reduce costs, Lane said.
About a quarter of hospital leaders are looking to invest in AI/robotic process automation, with half plan to do so by 2021, according to a survey from Olive and Sage Growth Partners.
Healthcare uses humans as routers, forcing workers to toggle between disparate systems, Lane said. "They copy, they paste, they manipulate data, they become robots. They click and type and extract and import, all day long – and it’s one of the leading reasons that one out of every three dollars spent in the industry today is spent on administrative costs," he said.
The company plans to expand beyond health systems to include other providers such as independent practices.
"We haven’t decided yet whether we want to work in the payer space. We think there is some asymmetry on technology that needs to be filled on the provider side first. There are plenty of growth opportunities just on the provider side," Lane said.