Healthify is providing the infrastructure to implement the social determinants of health

Steven Loeb · November 7, 2019 · Short URL: https://vator.tv/n/4f11

The company raised a $16M funding round earlier this week

It wasn't that long ago when the social determinants of health were not a part of the conversation around healthcare at all. Healthcare was what happened between you and your doctor, and the other aspect of our lives, all the time we spend outside of those four walls, was thought of as something separate. Now, even some of the nation's largest insurance companies are starting to look at those aspects of our lives as something they should be covering. The conversation has changed quite quickly. 

The space is still young, though, and there's a lot of work to be done to make sure that patients are actually getting access to the services they need. There's a lack of framework to make sure that that's happening, as well as to make sure that the organizations themselves are following through.

Healthify is the company that is building out framework in order to allow payers, providers and social service organizations to communicate with each other so that they know that people are actually getting access to the services that they need. 

Manik Bhat, CEO and co-founder of Healthify, first came to see the importance of the social determinants of health while doing community health work in east Baltimore for a number of years in a pediatric and community psychiatry setting. He was primarily working with high need, Medicaid families and saw that their biggest needs weren't clinical but social.

"Food, housing, childcare, employment, access, that’s what mattered. That’s what really impacted cost, that’s what really impacted outcomes. I felt at the time that I was at a pretty prestigious institution, but we were just failing families in getting access to these services. I felt that this was the elephant in the room in healthcare," he told me in an interview.

"If we’re serious about value-based care, ultimately we have to be really serious about how we scale solutions to address social determinants, because we know it impacts outcomes and that it’s a big component of why costs are so high in the U.S. The big, audacious goal was: let’s build a scalable, sustainable way to address social determinants in communities across the country."

What Healthify does is it builds the infrastructure to support social determinants of health initiatives at scale, bringing social services and healthcare operators into a network, allowing them to focus on the unique needs of each community.

Earlier this week, the company announced that it raised $16 million in Series B funding in a round led by SV Health Investors and existing investors like BlueCross BlueShield Venture Partners (BCBSVP). The latest round of funding brings its total raised to over $28 million through investments, grants, and awards.

In addition to the funding, it was also announced that Healthify added two new members to its board of directors, SV Health Investors' Vice President Carl Culicchia and Managing Partner Michael Balmuth.

"Michael and Carl are awesome. We met with a lot of folks throughout this Series B process and we loved their humbleness, transparency and deep knowledge of this space. They’re also growth funds, so they have reserved capital as well, which was exciting to us," said Bhat.

They’re helping us with a lot of introductions, helping us think through the right executive team to build and the right sales leadership to bring on board and marketing leadership to bring on board. And, being a PE firm, they have a lot of pattern recognition and cycles on that type of work so they’ve been really helpful there."

The problems plaguing the social determinants of health

There are three main problems that Bhat had identified when it comes to integrating the social determinants of health, and community organizations, into the healthcare system, the first being the issue of identifying, in a population, who’s actually in need.

"The health plan doesn’t know who has a social need, what the severity of that food insecurity need is, or what the critical housing need is in their membership. And that makes it really difficult for them to manage. So, we help them figure that out. We help them with a screening platform to screen for needs and match people to the best services and then we also can help them predict need in their population," said Bhat.

The second problem is allowing people to find information on resources, as a lot of the information on social services is out of date. To help solve that, Healthify provides a platform to help people find those community services. 

Those first problems, while important, are not Healthify's main area of focus, though; instead, the company puts most of its resources into solving the third problem: fragmentation. 

"Let’s say you’re a care manager working at a health plan, and I’m a diabetic senior. Usually what will happen is, you’ll meet with me and you might identify that I need Meals on Wheels. You give a referral and that’s usually where the conversation ends. You don’t know if i got the Meals on Wheels, Meals on Wheels doesn’t know I’m coming, Meals on Wheels is not incentivized for the delivery of service and the health plan you’re employed by has no transparency or visibility into what’s actually happening once the referral for the social service has been made. So, there’s deep fragmentation in service delivery," explained Bhat.

To solve this problem, Healthify builds and maintain what it calls "accountable" networks of community-based agencies, as well as providing a technology platform to allow community partners, health plans and payers to share information and report back on what the outcome was when the service that was delivered.

The company also handled reimbursements to the social service providers, which is a difficult part of the space to manage right now, as Medicare and Medicaid don't know how to pay for these services at the moment.

"The challenging part of this space is it’s kind of the wild wild west in terms of the reimbursement framework for social services and we look to ourselves as, can we introduce some clarity in all this noise?" said Bhat.

"The vision for the company is that we're not only the infrastructure for how people coordinate community service in healthcare, but also the network owner and, ultimately, we work on how people get reimbursed in this space from a social services standpoint as well."

Accountability for community partners

Healthify is currently working with over 40 enterprise clients. It works with eight Blue Cross Blue Shield plans, and is national with UnitedHealthcare. The company also works with a numbers of health systems as well, including Johns Hopkins. When it comes to the community partners the company works with, though, that varies from region to region, as certain communities have a lot of services, while some communities have fewer.

"That’s part of our focus and strategy. Our approach is that we really want to support the community partner to be successful in this network, and this is a game of value, not volume," said Bhat.

"On the community partner side we want to build accountable networks that are driving real value and are really tied to the needs in that geography and the needs of the payer in that area. So, certain communities we have a lot of community partners on board, certain communities we don’t, which is really informed by what we think is the right level of network engagement, and what’s going to drive real outcomes and accountability for that population in that area."

There are currently two tiers of organizations that it works with, the first being what it calls its “coordinated tier,” which is a broader network or community partners that address a lot of different needs. In this tier, there's no accountability layer, meaning Healthify doesn't know if they are delivering or not.

Then there's its “contracted tier,” where there is a defined, contractual structure and relationship, as well as a financial incentive, which is informed by an evaluation of the community partner.

"Keep in mind, there’s no credentialing in this space yet, so we evaluate the community partner, understand their readiness to support them, getting ready to coordinate with the network, and then do an analysis for the payer around their needs, what’s going to drive the highest impactable cost for them, so they don’t have to boil the ocean with these contractual relationships and we can hyperfocus our attention on the right network for them," said Bhat

"The way we think about that is putting a layer of accountability based on what’s going to drive the most value."

A big part of Healthify's impact is on completion rate of delivery; that means when a referral is sent out for a social service entity, that service was actually delivered. Typically, completion rate is about 8 to 12 percent but Healthify is seeing above 60 percent across all domains, in all of its networks.

New funding and the future of Healthify

The company will use the new funding to build out its team, specifically growing its sales and marketing divisions, and scaling its network management function; the plan is to from around 50 employees to around 100 in the next year. It will also be used to build out its network in key markets. 

In terms of the product, right now the company is working on supporting the coordination of service delivery, which is complicated by regulation, Bhat told me.

"When you get the payer, the provider and the community partner involved, it’s tough. You have to worry about data sharing compliance and consent. What is the integration not only with the payer but the community partner and the EHR? So, there’s a lot of work that needs to be done there to scale those parts of the product, and that’s where the majority of our attention is focused right now," he said.

In the future, though, Healthify is looking at supporting the management of payments in the product for these social services, and also building out some better consumer-facing experiences. 

"Right now, there’s communication layers for consumers, so they can conduct a screening, in some deployments they can search for services, they get text messaging around service delivery and referrals, but the majority of the use case is still really with care teams, so care management, social workers," said Bhat.

"Ultimately, we want the individual to be in the driver’s seat in how they get connected to these social services, but, right now, the roads aren’t built, and we’re trying to build the roads so we can build the car and have the consumer in the center of it and drive them."

This is an exciting time for the social determinants of health, as the space is growing but it's also still relatively young. Healthify's ultimate goal is to fully integrate these services into the healthcare system, thereby helping out its community partners financially as well.

"What people forget is one in nine social service entities are technically insolvent, and they’re looking for funding. A lot of our work is to help support their capacity and their growth in the community and really give them the power and capital to support the communities that they serve for decades. That’s what really needs to be solved in the space going forward and that’s how we’re thinking about it."

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