Jonna Kurucz, head of AI and emerging tech at Anthem, spoke at the Future of Health Insurance salonRead more...
Healthtech VCs weigh in on mental health challenges, and call treatments a 'crapshoot'
This year could be a record-setting year for VC investments in mental health and wellness.
It's one of the reasons Vator and HP focused on this topic during our second of four SplashX Invent Health salon-styled evening gatherings this year. [Be sure to join us for our next salon focused on Precision Health on September 27.]
As we do for all our Invent Health salons, we have a VC panel taking a deep dive into this topic for almost an hour, which invariably is never enough time.
The discussion ranged from how we innovate around diagnostics, treatment and prevention, to how we change perverse economic incentives that often have clinicians prescribing expensive drugs vs providing alternative treatment solutions, such as cognitive behavioral therapies.
The panel consisted of moderators Archana Dubey (Global Medical Director, HP Health Centers, HP) and Bambi Francisco Roizen (Founder and CEO, Vator) and panelists Ambar Bhattacharyya (Managing Director, Maverick Ventures), Billy Deitch (Principal, Oak HC/FT), Hubert Zajicek (CEO, Health Wildcatters), Stephanie Tilenius (Board Director, Investor, Vida Health), Liz Rockett (Investor, Kaiser Permanente Ventures), Lisa Suennen (Senior Managing Director of Healthcare, GE Ventures).
During their introductions, Deitch had made the point that, "Everyone in this room is crazy."
Francisco followed on that point, referring to a couple pieces she had written: "Why mental disorders are a cultural problem more than a biological one and another one on the stigma of mental illness.
“On that point, Billy, you're right. It’s not so much that there's a stigma of mental illness but rather there's a stigma around having a flawed life. Let’s just be real: we’re all crazy and we’re all flawed and the problem is, we can’t express that to people and as soon as it [this reality] hits us we go, ‘Oh, we’re mentally ill!’. But we're not mentally ill, that’s just who we are," she said.
"So what are we investing in to help us differentiate between who's a functioning, healthy person just dealing with life’s vagaries and who's truly somebody going down the path of a severe clinical condition?"
Zajicek agreed that there is a difference between real mental, clinically-diagnosed illness and what most people suffer through, which are more heightened emotional states.
"I think we do need to make one differentiation here and that is, there is psychiatric illness. I think most of us will agree that there’s some well-defined psychiatric illnesses that need to treated. They’re not self diagnosed; it's usually diagnosed by others because they’re a severe aberration from normal behavior. That is not even being discussed here," he said.
"What we’re talking about is really the rest of the spectrum, which is the whole realm of human emotion that can swing in all ways, that is still living a normal life, but, as we have learned recently, can lead to drastic results. Depression, of course, being the number one but there’s many other manifestations. I think that area where a lot of us think, ‘What is wrong with me? Why am I acting this way?’ is probably a good point in which we should all think back at this panel, when we were all diagnosed as being crazy, which is a good starting point."
Let's start by accepting that we're all crazy
Zajicek then suggested that if we start with Deicht's premise that we're crazy, then it's easier to get through life because we'd prepare ourselves by finding tools that can help us a long the way.
"If we all agree that we’re all crazy then we can all agree that we could have tools that help us along the way. When we see things come off kilter, we could start counteracting or seeking help, and that would not be stigmatized, that would just be a normal thing. Removing those barriers, as in going to have see someone or worry about your primacy care physician, having to approach him or her about it, if we can remove those barriers and give direct access, I think a lot of things can be balanced out", said Zajicek.
Dr. Dubey followed up by asking why more investments are directed toward solutions and not diagnosis, calling that the "missing part."
"I agree with you, we are all crazy; I actually put it a different way for my patients: there are two kinds of people, one who is with a therapist, and one who is not who needs to be. Consider a therapist as a life coach, if you don’t have a condition or a therapist if you do have a condition. How do you come to that condition?" she asked.
Essentially, Dubey cleverly pointed out that without really knowing what condition a person has, it's hard to know what tools they need.
Suennen went back to what Zajicek had said about patients not being able to self-diagnose, and pushed back on that notion.
Treatments are a crapshoot
"I somewhat take issue with the idea that patients can’t self diagnose some of these conditions. Now, we have to differentiate between schizophrenia, bipolar disorder, things that are truly, deeply biological conditions, and many forms of depression are as well. Doctors do diagnose these things, but on the other hand, for the more day-to-day models of anxiety and depression that people experience, I think people self diagnose very well. They may not treat, they may not get treatment, that’s a different question. I think people know, by and large, pretty well," she said.
To her, diagnosis isn't the problem, it's access.
"I think actually the biggest challenge is the treatment, is getting access to the right treatment, knowing who to call, knowing even where to vet a decent therapist or drug or whatever. A lot of times the drugs don’t work very well for most people, or they have to try multiple ones. The therapists don’t work well for most people, they don’t match the first one they see. The treatment is a total crapshoot, and I think that is the bigger problem, frankly."
Deitch concurred, and brought up the issue that payers have with being reimbursed, which also affects access.
"Payers are notorious for not reimbursing mental health professionals at reasonable rates, so then patients don’t have access to them. I think there’s someone here speaking from Lyra, which is a great platform for the employers who will purchase Lira for their employees, and we’ll see that in a lot of startups here in the Bay Area, but you don’t see that everywhere in the country. But it’s the right idea, saying that this is important for our employees, our patient population, it makes them healthier, it makes them happier, it makes them more effective employees," he said.
While platforms like Lyra and Quartet are helping, "there needs to be more fundamental shifts in the way that the payers think about it as well, and saying, ‘This is important for the overall cost of care for a life we’re managing, so let’s also get them access to behavioral health professionals.’
"I do want to touch on the economics incentives today, some of them are pretty perverse. How are these new solutions making the economic incentives driving caregivers to provide better care, because right now the incentives are off for them to provide proper care," Francisco asked Rockett.
In terms of the diagnostics, she said, providers don't have the time or bandwidth to use new technologies.
"We talk about this all over healthcare, but I think in mental health in particular we don’t have a system that’s structured with a sufficient access to get to all the people, never mind do extra hand holding along the way. I’m sure there’s some providers who figured out how to do that but, as a system, I don’t think we’re quite ready," she responded, noting that self diagnosis is more likely to happen if access is increased.
Rockett pointed to AbleTo as a good model for how to overcome both the economic and access issus.
"Part of their approach is just to identify, in the claims, this person has recently had a heart attack, they recently had a child, they recently had any sort of life event that shows up in a claim, we can reach out to them and offer this service just as a friendly thing. It’s not assuming anything about you, but just saying, ‘Hey, we know lots of folks who have just gone through this, they find it to be a scary time, here’s a service where you can chat with somebody and get help,’ so that it doesn’t feel like, ‘You seem like you’re crazy. Do you need help?’ Instead it’s, ‘Lots of people having the experience you just had go through something like this and we have a service that can help.’ It gets right to the heart of what payers know to be true of folks who have just gone through this sort of episode, they may not be as compliant, they may not be as attentive to the way they should pursue their medical care if their mental health is not addressed. So it’s a way to target both the economic incentive, as well as overcoming that stigma."
Tilenius noted that there's a lot of incentive for employers to solve the economic issues related to healthcare.
"One in four, one in five people have a mental health issue and if you look at the comorbidities between physical and mental health it’s very costly. So the payers and employers are all very interested in solving this problem, it’s a very hot topic among decision makers, buyers," she said, also noting that there have been changes in the reimbursements systems.
"You’re starting to see a shift but we’re working with a very large employer, they had four suicides last year in one of their large call centers and they looked at the cost associated with that, and the productivity impact, and it’s massive. So they are doing everything they can to solve it. We hear it pretty loudly from the employer side in particular."
Bhattacharyya spoke last, and brought up that there are three things that needs to be solved for: access, effectiveness and durability, meaning if an intervention leads to lasting change. Cityblock, a company that Maverick has invested in, is helping to solve these problems.
"One way we’re addressing that is we’re taking full risk on these patients. We’re taking full medical risk and, per Stephanie’s point, there’s a lot of mental risk that’s layered in that. And that’s how we think about our ROI. If we do have therapists on staff or behavioral health specialists that are going to people’s homes and talking to them, how do we generate that ROI? And how do we make sure it’s a durable ROI? Not just a flash in the pan. That’s how we think about it, we think, ‘If this is an intervention that is lasting, and you do see it in the claims over time, then you know it’s making sense. But all three of those elements have to be true. People have to access it, it has to be effective and it has to be durable."
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Related Companies, Investors, and Entrepreneurs
Joined Vator onVida is a mobile, virtual care platform for primary and chronic care that connects consumers to health providers 24/7 for text, audio and video support. Vida's national network of providers cover 20 different conditions. Vida has partnered with Duke and MD Anderson where we are working on clinical studies managing the virtual care of cardiac rehab and cancer patients.
Joined Vator onCo-founded Health Wildcatters, which I also run. I specialize in healthcare companies / startups (digital health/ mHealth / medical device companies) where I have spent most of my time.
Joined Vator onVenture investor for Kaiser Permanente Ventures focused on healthcare IT, digital health and tech-enabled services in healthcare. Board director at Big Health, Chrono Therapeutics, board observer to Omada, Vapotherm, LP advisor to Rock Health.