Axios Pro: Health Tech Deals

October 23, 2023

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1 big thing: Greater Good nets $20M for senior VBC

Illustration of a cane forming the center staff of a caduceus.

Illustration: Gabriella Turrisi/Axios

Elder-focused primary care provider Greater Good Health raised a $20 million Series A to build its first clinics, CEO Sylvia Hastanan tells Erin exclusively.

Why it matters: Greater Good hopes its nurse practitioner-led model and value-based incentives can help address the dire shortage of primary care providers as the older population continues to grow.

Details: Flare Capital Partners led the round.

  • Previous backers LRVHealth, Health Velocity Capital, Martin Ventures, and Optum Ventures joined.
  • In addition to building clinics, the funds will be used to hone Greater Good's tech stack and build a playbook for future expansion.
  • Hastanan foresees the startup raising a Series B in 2025.

How it works: Based in El Segundo, California, Greater Good partners with health plans and provider groups to help them shift to value-based arrangements.

  • "We build programs that are integrated into their infrastructure," says Hastanan. "Our nurse practitioners lead those programs, see their patients, and our operators manage them."
  • Greater Good is putting the approach to work building three elder-focused primary care clinics in Montana as part of a value-based care partnership with Humana.

Be smart: Recent legislation in several states grants nurse practitioners (NPs) — projected to be the fastest-growing occupation within a decade — full authority to oversee primary care.

What they're saying: "We think [NPs] are capable of managing risk when trained and brought into the model properly and, besides primary care providers, they're some of the only providers who can do this independently," says Flare Capital partner and Greater Good investor Victor Lanio.

Flashback: Before starting Greater Good, Hastanan was an executive at large health care incumbents including GE Healthcare, DaVita and Optum.

  • "I noticed that nurse practitioners were being tapped to go into [patients'] homes, to do virtual visits, and to serve as a bridge between doctor's visits," says Hastanan.
  • "But they were turning over a lot and the retention strategies just weren't there."

State of play: Greater Good's approach is similar to those deployed by other senior primary care clinic operators, many of which have seen sharp market interest as the U.S. population grows older, faster. For example...

  • One Medical — now owned by Amazon — in 2021 bought value-based senior clinic operator Iora Health in a deal worth an estimated $2.1 billion.
  • CVS Health this year bought Oak Street Health, another senior-focused primary care business, for an estimated $10.6 billion.

Yes, but: Where those companies were focused on urban markets, Greater Good is homing in on rural areas.

  • "I think around the edges there's tons of opportunity and [it's] maybe more obvious for us to start there," says Hastanan, adding that the company is estimating a roughly three-year timeline to develop its model.
  • "It takes a long time to change behaviors. We want to grow slow to grow fast," Hastanan says.

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