Exclusive: Laguna Health gets $15M to be a Waze for care transitions

Laguna Health raised $15 million in Series A capital to turbocharge efforts to become a Waze for care transitions, CEO Yoni Shtein tells Axios exclusively.

Why it matters: Research suggests the work Laguna does — identifying potential care roadblocks as patients move from acute to home-based settings — can boost patient outcomes and reduce medical spending.

Deal details: SemperVirens and HC9 Ventures co-led the round, bringing total company financing to just over $21 million.

• Laguna will use the new funds to hone its AI capabilities and hire marketing and advertising staff.
• Shtein declined to say when he foresees the company raising again, adding that the company has "years" of runway while declining to specify a specific timeframe.

How it works: Laguna's AI-powered care management tools, which it offers health systems on a white-labeled or branded basis, are designed to smooth patients' transition from hospital to home.

• Shtein likens Laguna's services to a kind of Waze or Google Maps for care management, wherein its AI and natural language processing tools can reveal possible care obstacles — much in the same way those routing tools might surface a coming traffic jam or crash.
• Services include personalized coaching and case management to "understand what’s going on in your life that’s getting in the way of your care plan adherence," says Shtein.
• To assess its progress, Laguna tracks patient and caregiver engagement, rates of patient hospital readmissions, health system cost savings and gains in labor-based productivity, he adds.

The intrigue: It remains to be seen whether Laguna can demonstrate to health systems the cost-savings necessary to convince them to move from the pilot stage to longer-term arrangements, notes HC9 general partner Richard Lungen.

Be smart: Increased clinician attention to a patient's contextual factors is linked to better outcomes and lowered costs, according to a 2022 study published in the Journal of the American Medical Association with a Veterans Affairs health system.

What he's saying: "We started the company in early COVID days when digital health was booming," says Shtein. "That was often at the expense of signal and impact."

• "What’s changed with this economic cycle is we’ve seen a heightened focus on cost savings and labor efficiency," he adds. "The conversation has become very real, rapidly."

State of play: Potential rivals to Laguna include Walgreens subsidiary CareCentrix and Optum subsidiary NaviHealth, but none are focused exclusively on the acute care space in which Laguna operates. For context:

• Walgreens in 2022 acquired CareCentrix for roughly $392 million, per Fierce Healthcare.
• Optum in 2020 acquired NaviHealth for an estimated $2.95 billion, per Pitchbook.

🌊 One fun thing: Laguna's name is an homage to lagunas, bodies of water typically protected from outside seas.

• "That’s what we wish for our members to experience," Shtein says. "Usually these transitions are not that way, so it’s aspirational language speaking to the world we’d like to create."