Health Information Technology continues to draw interest from big IT firms and venture capitalists seeking to get in on one of the more lucrative aspects of the health care boom. All aspects of health care are looking at ways to streamline care, handle a glut of medical data and manage shifting demographics, regulation and organizations. Health IT is also one of the few areas politicians at all levels of government appear willing to spend money on.
Yesterday Verizon Chairman and CEO Lowell McAdam, outlined how he sees the current health care landscape including challenges faced by both providers and governments as they work to meet ever increasing demand.
“Today’s health care market operates in silos without the ability to share patient and clinical data at even the most basic levels,” said McAdam.
He went on to show how his company is working to capitalize on that inefficiency – by forming a strategic partnership with NantWorks LLC, a California-based technology and health care company. The companies will leverage NantWorks’ set of health care technologies and Verizon’s platform-based health IT portfolio. The partnership follows Verizon’s recent combining of its wired and wireless services and IT and network assets to form an integrated health IT organization.
The company’s health IT practice – Verizon Connected Healthcare Solutions – amounts to some $5 billion of the company’s overall portfolio. The practice has also recently partnered with Duke University and Health Evolution Partners on two separate health IT ventures.
Private equity and venture capitalists are also getting in on the health care/health IT boom. Privia Health, LLC, a physician-based wellness and care management company that is building the nation’s largest high performance network of top doctors, announced yesterday that it has secured $12.3 million in private equity financing. The effort was led by Health Enterprise Partners (HEP), a New York-based healthcare private equity group whose limited partners include some of the nation’s top health systems and health plans.
Privia is designed to provide physician-led preventative wellness care as well as sick care. The group says that it is working to refocus health care on better patient outcomes through overall wellness management rather than waiting until an individual is already sick.
HEP the private equity firm that handled fundraising for Privia is backed by Baylor Health Care System, Dignity Health, Riverside Health Care System, Sentara Healthcare, Sutter Health, UPMC, and WellPoint, among others. The founders have been involved in health care financing for several years. The team includes Dan Cain, founder and managing director of Cain Brothers, a leading healthcare investment bank; Rick Stowe, former general partner of Welsh, Carson, Anderson and Stowe, one of the largest healthcare private equity firms in the country; and Bob Schulz, former President and COO of Harris & Harris Group, a publicly traded venture capital fund.
According to data from Texas-based consulting firm Mercom Captal Group, Q1 2012 also saw the highest number of venture capital health IT deals ever recorded with $184 million in 27 deals, being allocated. A total of 46 different VCs invested in Q1, spurred by federal support through the Health Information Technology for Economic and Clinical Health (HITECH) Act.
Top deals included $40 million going to Kinnser Software, a clinical support software company and $22 million to Healthx, a provider of online healthcare portals.