Independence Blue Cross is investing in startups that offer innovative solutions to healthcare challenges.
10 Medical Robots That Could Change Healthcare
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Independence Blue Cross (IBX, formerly IBC), the largest health insurer in the Philadelphia area, has become one of the first health plans in the U.S. to invest in health IT startups. In a collaboration with Penn Medicine, which includes the University of Pennsylvania Health System, and DreamIT Ventures, IBX launched an accelerator that recently selected 10 startup companies from 130 applicants.
Among the firms that made the final cut are AirCare, Biomeme, Fitly, Grand Round Table, Medlio, MemberRx, OnShift, Osmosis, SpeSo Health and Stat. Each company will receive $50,000 in seed capital, as well as intensive mentoring in a four-month "boot camp."
The DreamIT Health accelerator is the first health IT accelerator in the Philadelphia area and the first anywhere in the country to involve both a dominant payer and a leading healthcare system, said Mike Vennera, VP of strategy and innovation for IBX, in an interview with InformationWeek Healthcare.
However, in 2011 the Blue Cross Blue Shield Venture Fund, a subsidiary of the Blue Cross and Blue Shield Association, put money into a new accelerator called Healthbox. That accelerator, part of Chicago-based Sandbox Industries, initially provided assistance to 10 health IT startups. Blue Cross Blue Shield of Massachusetts invested in the first batch of companies, all from Boston.
Aetna has purchased several IT-related firms, including ActiveHealth Management, iTriage and Medicity. But none of them were startups when Aetna bought them. UnitedHealth Group's Optum unit also has invested heavily in health IT but not in startups. California Blue Shield has used mobile gaming apps in its wellness program; however, it has not invested in the firms that provided them.
IBX is trying to find innovative healthcare solutions in the "entrepreneurial community," Vennera said. So about a year ago, the company sponsored the IBX Game Changers Challenge, which challenged entrepreneurs to develop solutions to improve population health in the Philadelphia area. For this competition, IBX partnered with the Wharton Entrepreneurial Programs; Philly's public health department; VentureForth, which develops enterprise mobile solutions; and incubator firm What If? Innovation Partners. The consortium selected three winners last June, giving them the same prizes that the accelerator participants are getting.
IBX's formal involvement with these firms ended after the contest. The company wanted to take the concept to the next level, so it forged a partnership with Penn Medicine, which had similar goals, and DreamIT Ventures, which has run other IT accelerators. DreamIT will provide the infrastructure for the accelerator, and IBX and Penn Medicine will help them develop and refine their business plans and provide feedback on their products. "So we'll have more of a stake in these organizations," Vennera said.
Does that mean that either the health plan or Penn Medicine will help pilot any of these applications?
"Potentially," he replied. "We'd love to see all 10 companies come out of this with 10 products that are ready to be piloted. We're not guaranteeing any pilots, but we hope we'll get some strong solutions that one or both of us can pilot in our respective businesses."
One of the DreamIT Health winners, Medlio, has developed a mobile app that eliminates paper signup forms in physician offices through a "virtual health insurance ID card." Two of the other startups offer solutions that could help cut health costs -- a major goal for insurance companies. AirCare's mobile app is designed to help hospitals prevent readmissions through tele-nursing, while MemberRx's app helps doctors cut drug costs by selecting the best generic or on-formulary drug for a patient.
Asked whether any of the winners were selected because their solutions might cut health costs or make it easier to deal with IBX, Vennera said, "Those weren't explicit criteria. We looked for companies that had a good, marketable solution that was in the general wheelhouse of Penn or IBX. Because at the end of the day, if these are good solutions, not only would we like to adopt them, but we'd like to help these companies grow."