Last year, about a dozen companies were born out of Redesign Health, a New York City-based firm that launches healthcare startups. On Tuesday, the first Redesign startup of the year announced its launch, along with $4 million in seed funding.
Redesign’s latest offspring is Valendo Health, a value-based endocrinology company based in Boston.
The startup seeks to improve diabetes care. Diabetes can be quite a complex condition — one that can be not only difficult for patients to manage, but also a significant source of stress for endocrinology practices. And now practices are under pressure to migrate to value-based care arrangements, putting an added emphasis on measuring quality to prove they are reducing the total cost of care, pointed out Valendo CEO Dave Terry.
“Diabetes patients under endocrinologist care experience fewer complications, ER visits and surgeries, as well as less time in the hospital. Endocrinologists are best positioned to be the diabetes care team leader but are currently held back by limited resources and fee-for-service payment models,” he explained.
To address this issue, Valendo partners with endocrinologists and provides them with technology — including a telehealth platform, remote patient monitoring, and tools to aggregate and derive insights from data.
Once Valendo partners with a practice, it goes through three phases. In the first phase, Valendo works with the practice to improve its clinical capacity and patient services through establishing telehealth-based care options, such as virtual visits and remote patient monitoring. The startup provides practices with a “telehealth-enabled diabetes care team that serves as an extension of the practice,” including dietitians, nurse practitioners, on-call endocrinologists and certified diabetes educators, Terry noted.
The second phase is aimed at making sure practice operations run smoothly. In this phase, Valendo helps practices implement technology to streamline operations, reduce overhead costs and boost profitability. Some of this technology includes software to centralize revenue cycle management, as well as analytics tools for things like risk stratification and patient engagement.
During the third phase, Valendo focuses on creating and managing value-based specialty care contracts with health plans and at-risk provider groups.
“Through these services, we help endocrinologists serve more diabetes patients and move into value-based care arrangements so practices can meet growing demand, enhance their patient care and be rewarded for the value they provide patients,” Terry stated.
The startup currently has two customers — Cecelia Health, a New York-based virtual specialty provider, and Advanced Metabolic Care and Research, an endocrinology practice based in Southern California.
Valendo operates on a revenue share model and is only compensated based on the incremental revenue impact delivered to its customers, Terry explained. Unlike traditional management service organizations (MSOs,) Valendo doesn’t require an upfront investment from providers, he added.
While there are a number of SaaS vendors and MSOs that provide telehealth tools and administrative/operational support to independent specialty practices, Terry argued that Valendo “is entering the space at a different angle” than other companies.
“Valendo provides the staff, technology and infrastructure that is purpose-built for specialty care and is backed by a data-driven platform to improve patient engagement and care planning, stratify risk, improve performance and transition to value-based care,” he declared.
Photo: atibodyphoto, Getty Images
