Aledade raises $123 million to expand value-based care

The company says it has saved more than $1B by working with practices to establish ACOs

The U.S. healthcare system is increasingly turning to a value-based model, one in which payments are based on outcomes, rather than simply providing a service: in 2020, over 40% of US healthcare payments, representing approximately 238.8 million Americans and over 80 percent of the covered population, stemmed from value-based reimbursement models. 

Aledade is one company helping the system transition to a model that incentivizes the physician to give the patient quality care and on Monday it announced a $123 million Series E funding round led by OMERS Growth Equity led the round, along with Fidelity Management & Research Company and other current investors.

The company works with independent practices to develop Accountable Care Organizations (ACOs), which focus on a value-based care model through Medicare, Medicaid, and commercial insurers. The idea is to reward these practices for keeping their patients healthy, for following up with them when they leave the hospital, and for keeping them out of the hospital altogether.

When a practice decides to partner with Aledade, the company provides them with a few different things, including a technology solution that helps them identify and focus on their high-risk patients, as well as with on-the-ground support from its team that helps the practice adapt to new workflows. The company also offers regulatory and policy guidance to make sure that these practices know how to navigate these programs and have a voice speaking up for them in policy and payer discussions.

Aledade now partners with more than 1,000 independent primary care practices, including more than 140 federally-qualified health centers, comprising more than 11,000 physicians in 36 states and the District of Columbia. Aledade's nearly 150 value-based care contracts, including 98 Medicare contracts, collectively cover more than 1.7 million patients and $17 billion in total health care spending.

In Medicare Advantage contracts, specifically, Aledade says that it increased the number of patients served by 85,000 in 2021, bringing the total to more than 200,000 patients covered by MA who receive care through an Aledade ACO.

The company says its model is projected to have created over $1 billion in total savings across the health care system to date. 

The new funding will help Aledade continue expanding its value-based care model, so it can find, and possibly acquire, more wraparound care solutions to support its nationwide network of primary care physicians; earlier this year, for example, Aledade purchased advanced care planning company Iris Healthcare.