Health systems’ innovation funds eye behavioral health Leave a comment
Patients with a behavioral health condition cost 2.8 to 6.2 times more to treat in than those without a behavioral health condition in 2017, according to a 2020 Milliman report. While annual expenses for the highest-cost behavioral health patients averaged $45,782, half of that group spent less than $95 per year on behavioral healthcare.
“Payers could come to the table to work more closely with providers and pay for some of these technologies because they are getting the economic value,” Vaezy said. “We haven’t figured out a model that works because there isn’t enough cross-sector trust here—it’s the single biggest hurdle.”
Startups need to be payer-agnostic if the goal is to scale up, Providence’s Dowdy said.
“From a primary-care provider’s perspective, they can’t be thinking about insurance coverage,” he said.
If a mental health startup loses money on each encounter, it is not sustainable, said Jeff Goldsmith, president and founder of the healthcare consultancy Health Futures.
“Billions are going to be squandered. It is not clear that you are buying a sustainable market advantage,” he said. “There is not going to be an ‘Amazon’ in this space.”
Even amid these challenges, health systems continue to ramp up investment in their innovation divisions with a renewed focus on behavioral health.
Winston-Salem, North Carolina-based Novant Health recently launched an incubator that aims to grow new devices and emerging digital technologies. Novant Health Enterprises, which will operate as an independent entity within the 15-hospital system, looks to partner with other healthcare organizations and diversify its revenue, executives said.
Mass General Brigham created a $30 million venture fund in 2019 to invest in digital health and artificial intelligence-based solutions.
Bon Secours Mercy Health, a 50-hospital system spread out across the Midwest and East Coast, spun off a subsidiary that will develop and invest in digital health products, services and technologies. Accrete Health Partners is one of four private equity-backed companies at Bon Secours Mercy, which aims to create a “world-leading digital health ecosystem.”
Providence is starting a mental health innovation accelerator program, where it hopes to incubate ideas from its front-line caregivers about how to address the growing need for behavioral health services.
“They are best positioned to understand these challenges and we need to find ways in which we can support them,” said Dr. Arpan Waghray, chief medical officer of behavioral medicine at Providence.
