A startup that helps community workers guide Medicaid members to the care they need just raised a new round of funding.
People on government-run Medicaid insurance for low-income households can often be hard to reach. Reema Health hires community guides, who are often social workers or other types of people embedded in a local community, to build relationships with members and guide them to the care they may need. HC9 Ventures led the $7.6 million Series A round as a new investor, joined by fellow new investor Ensemble Innovation Ventures Fund. In total Reema has raised $17 million.
It’s betting that getting people to the care they need sooner, will cut down on healthcare costs for insurance plans in the long run.
“I will exchange dozens of text messages about last night’s episode of ‘The Bachelor’ before we get to anything even remotely more meaningful than that, because we know that’s the best way to build a relationship,” CEO and co-founder Justin Ley told Endpoints News in an interview.
The startup draws on census data of geographic areas and an individual’s clinical and claims data to figure out what are the best next steps. But its most valuable dataset, Ley said, is a history of past interactions. For example, whether a phone call or an in-person reach-out has worked in the past, or what time of the day is the member most responsive to texts.
“I often joke with our health plan customers that if I had a nickel for every time someone said I have the most brilliant AI chatbot that’s going to solve all your Medicaid engagement needs I’d be wealthy,” Ley said. “This is not that, but we definitely are leveraging that tech in order to build better relationships with the people we serve.”
Venture firms tend to shy away from startups that do business with Medicaid as it’s highly complicated to navigate, Ley said. The government-backed insurance option also tends to pay less. But Richard Lungen, co-founder and general partner of HC9 Ventures, said he thinks the economic impact of getting care to a historically underreached population is worth it, and that the healthcare executives behind his venture fund agree. HC9 has an $83 million fund that’s backed by the personal funds of over a hundred healthcare executives in 2022 to invest in early-stage health tech startups.
“Health plans, fortunately or unfortunately, should be doing this for themselves,” he said. “Fortunately for Reema, they’re not very good at this, which is why we have a very good business model here.”
Around 40% of Reema’s customers come from Medicaid plans, and another 40% come from patients who are on both Medicare and Medicaid plans, according to Ley. The remaining 20% of patients come from commercial plans.
Reema started hiring full-time therapists to build out its behavioral health service last year and plans to expand into more areas with the new funding. When Reema guides tried to set their patients up with therapy appointments in the past, they realized that the wait time is often so long that patients have already moved on from a distressing life event without getting the care they needed at the moment, Ley said, so Reema took things into their own hands.
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