Collective Health aggregates $280 million in new financing to support its employer health benefits management business. The investors have lost their collective minds. The company serves employers with 300,000 members in 55 companies, so it is being valued at about $1000 a member for a commodity business.
R1 RCM, a vendor of provider revenue cycle management software and services, is paying a healthy $300 million to buy VisitPay, which helps patients figure out to pay what they owe for health care services.
Headway has raised $70 million in new capital to facilitate growth of its platform to assist therapists in providing mental health services and patients in finding therapists.
I have been writing this blog for a long time and I thought I had seen some wild times for investments and valuations, but this is insane. Every day, multiple new investments at very high valuation. CareSyntax, which offers software to help collect data on surgeries and help with decision support, raised $100 million in new capital. If I can't understand how a company can possibly deliver that much value, something is seriously wrong.
Capsule, which operates a "digital" pharmacy raised $300 million in additional capital. You can't have a health care business if it isn't digital, no matter how pedestrian its business. Craziness in the capital markets.
Digital health is a wasteland. Someone has developed an app or multiple apps for every possible disease or condition. These are all commodities and generally provide little real value, but investors are pouring money into them at very high valuations. Sorry to piss all over the idea, but here is an example, a company called Renovia raised $17 million for an app to help manage urinary continence. More specifically, the app will help with exercises for pelvic floor disorders. Well, I am floored by the investment and valuation.
Privia Health, which provides administrative and patient engagement software to physician practices, is planning to go public by raising over $300 million, which would value the company at almost $2 billion. Valuations are absurd.
Sesame opens investors' wallets for a $24 million capital raise to support its seedy business of providing discounts to self-pay patients. Way too much capital floating around out there.
Humana is buying the 60% of the Kindred Care at Home business for $5.7 billion. Humana currently owns 40% of the firm. Humana indicated that it may not keep the hospice portion of the Kindred business.
Sun Life, the largest private stop-loss carrier to self-funded plans, is acquiring PinnacleCare, which offers health care navigation services to help employees find cost-effective health care.
For those who have been here for CV-19 posts, this is the first in what will be a lot of posts back to health care business and policy. Many have this one sentence format on a capital raise or transaction. I will give a little more explanation than a normally would about the significance. You will also note my love of puns. Accolade, which offers assistance to employees in making health care decisions, is buying PlushCare, which provides telehealth visits for primary care and mental health. The price is an astounding $450 million dollars. Virtual care has expanded during the epidemic, but it is a commodity and a no-barrier business. Too much capital floating around in health means lots of bad deals in the long-run. No plaudits from me for the deal.
As is usually the case in health care, the big just keep getting bigger. UnitedHealth Group's Optum division is buying NaviHealth, which helps manage post-acute care for Medicare Advantage members.
The Healthy Skeptic is a website about the health care system, and is written by Kevin Roche, who has many years of experience working in the health industry. Mr. Roche is available to assist health care companies through consulting arrangements through Roche Consulting, LLC and may be reached at khroche@healthy-skeptic.com.
The Healthy Skeptic is a website about the health care system, and is written by Kevin Roche, who has many years of experience working in the health industry. Mr. Roche is available to assist health care companies through consulting arrangements through Roche Consulting, LLC and may be reached at khroche@healthy-skeptic.com.