Scoop: Martin Ventures-backed Wellvana Health mulls strategic options

Wellvana Health, a Martin Ventures-backed value-based care enabler, is exploring strategic alternatives, sources tell Axios.

Why it matters: As strategics look to disrupt primary care, investors remain hyper-focused on supporting the industry's transition to a reimbursement model based on the quality of care and outcomes.

• Nashville's Wellvana is one fast-growing player dedicated to that effort.

Driving the news: A SVB Securities-run process prioritizing a primary capital investment just kicked off, sources say.

By the numbers: Wellvana is projecting over $1 billion of revenue and around $25 million of EBITDA in 2023, sources say.

• Revenue and EBITDA are estimated to surpass $2 billion and $100 million, respectively, in 2024.

How it works: Wellvana sets up contracts with provider groups to help them succeed with value-based care.

• About two-thirds of Wellvana members enter into the DCE/ACO Reach program, with the remaining one-third Medicare Advantage.
• With 800-plus primary care doctors in its network, more than 70,000 members on the Wellvana platform will be full-risk in 2023, with a footprint in 20 states.
• Wellvana has a heavy "boots on the ground" model, as one source puts it, engaging regularly with practices to identify opportunities to improve quality outcomes and generate savings. Wellvana shares in those savings.

State of play: A good comp for Wellvana is Agilon Health, which CD&R took public last year — but there are a couple of big differences:

• Agilon is heavier in Medicare Advantage versus ACO Reach.
• Agilon tends to partner with larger practices and is more geographically concentrated, whereas Wellvana focuses on partnering with small practices that have historically been under-prioritized by risk-enablement companies. 

What they said: Most value-based care startups in primary care focus on larger entities with existing infrastructure, but 40% of the senior population is managed by small independent practices with 10 or fewer physicians, Vytalize Health CEO Faris Ghawi told Sarah in April.

Be smart: Wellvana has a big health care name behind it — Charlie N. Martin Jr.

• The industry veteran and entrepreneur co-founded and stood up Wellvana with a $4.5 million investment in 2018 through his Nashville VC shop, Martin Ventures.
• Martin among other things founded and was CEO of Vanguard Health Systems, ultimately selling it to Tenet Healthcare for $4.3 billion in 2013.

Yes, and: Wellvana in January named former SmileDirectClub CFO Kyle Wailes CEO. Wailes formerly helped build out Intermedix's primary care practice business before it was acquired by R1.

The bottom line: Health care is inevitably moving towards value-based care, but many millions of Medicare beneficiaries are still not part of these programs. That means there's room for many winners as investors demonstrate a voracious desire to participate in this innovation.

Wellvana and SVB declined to comment.