Wei-Li Shao

This 👂 podcast episode and insight’s from a16z Bio + Health's Julie Yoo spoke so clearly to the fundamental challenge facing both 🩺 clinicians and 🏥 healthcare systems.  There is a huge disconnect between supply, in the availability of clinicians, and demand, in the increasing volume and complexity of healthcare needs. -     36% of physicians plan to reduce their hours next year according to the AMA -     48% of physicians reported feeling burned out in a 2024 Medscape survey At the same time, the demographic baby boomer bubble and steady increase in the prevalence of major chronic disease, which consumes up to 90% of healthcare expenditures according to some estimates, is driving demand. With this context, Yoo points to a major opportunity for AI adoption in healthcare in 2025. Yeah, a VC hyping a wave of new AI companies that will replace the decades of training and experience of clinicians, the skeptic would say.  But Yoo is thoughtful in pointing to the role AI can play, and is already playing, through solutions such as ambient, autonomous scribe solutions (of which local star Abridge is leading the pack) in not replacing, but freeing up productivity for clinicians. There is so much unstructured context in both the complexity of disease and treatment options and the social/emotional considerations that we shouldn't be looking for AI to *replace* clinicians. But companies are getting better at finding the structured, repetitive and time-consuming places where AI tools can *help* clinicians. Nearly two-thirds of doctors cited bureaucratic tasks as the leading contributor to burnout. Rigorously trained-AI driven solutions can be a force multiplier for clinicians, and I’ve seen several interviews where nurses and doctors go as far as to say some of these solutions are ”restoring their joy in practicing medicine”. Our health is precious; and we rightly want any technology engaging with it to be developed thoughtfully and thoroughly tested. This requires top AI talent and diverse and realistic training data. Pittsburgh’s strengths in both areas is why we are an emerging hub for data-driven healthcare. #AIinhealthcare #clinicianburnout #healthinnovation #digitalhealth

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…and private equity wants in on the action. Well that makes sense 🙄 Turns out running a hospital is very, very hard. A 4.3% margin is not healthy, even for a non-profit. Payors and pharma continue to point the finger at these “rich” hospitals and complain about market consolidation, 340B, and any number of other phantom problems, but in reality most are just trying to survive. Many of these grievances are gaslighting in its purest form. Those making it work are focused on the basics. The strategic plan has highly pragmatic, common sense initiatives that return a tangible benefit with clear measurable targets as opposed to chasing trendy buzz words. They control labor and they control drug cost. On the pharmacy side, they deeply understand the economics and have an appropriately positioned business minded, strategic pharmacy leader. #pharmacist #pharmacy #hospitals #healthcare https://lnkd.in/g9d9VTcK

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Imagine swallowing the competition whole. That's what many players in tech do via roll-up strategies, gobbling up smaller firms to deliver richer solutions and amass greater market share. Where else are roll-up strategies common? // HEALTHCARE Picture being a patient at a medical practice that’s been part of a roll-up in Healthcare Services. It's an industry ripe for roll-ups due to its fragmented nature and potential for greater efficiency. // CONSUMER SERVICES Or let's say you needed your HVAC serviced, and notice your local repairman is now part of a bigger Consumer Services entity? Centralized management and scale economy turn these localized businesses into roll-up targets. // FINANCIAL SERVICES Think about your insurance agent or wealth management advisor. They're working in complex, highly regulated environments. In the Financial Services sector, roll-ups offer an effective way to consolidate expertise, streamline operations, and enhance customer offerings. // MANUFACTURING Now, imagine driving past factories under a new name — the result of Manufacturing and Industrial Services roll-ups. Bulk purchasing reduces costs, enhances production capabilities, and expands geographical footprints. // REAL ESTATE Lastly, envision your real estate brokerage firm. The industry sees roll-ups as a strategic move to increase market penetration, enhance service offerings, and hike up portfolio value. Roll-ups play a huge role in most industries, rather like a snowball rolling downhill, gaining momentum, and size. Are you seeing roll-ups in your sector or considering M&A?

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These unique advantages in venture capital are indeed compelling, which raises the question: Why haven't they been widely adopted in the industry? We can distill the resistance down to a few key misconceptions: 1. **Overreliance on Capital Influence**: The belief that "Having capital is sufficient to drive change" often leads to an external, top-down approach that may not align with the realities on the ground. 2. **Underestimating Physician Business Acumen**: The outdated notion that "Physicians lack business prowess" has been repeatedly disproven by numerous real-world examples across generations. 3. **Overvaluing Back Office Capabilities**: The assumption that "Our back-office provides superior insights and analysis" is flawed. In reality, the same fundamental principles apply across the board: successful exits, founder intelligence, robust deal flow, and iterative processes that optimize analytical costs. These misconceptions hinder the adoption of game-changing approaches in venture capital.

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Redesign Health has launched its largest fund to date, securing $175M to support over 20 new healthcare startups. Founded in 2018, the venture builder has previously incubated more than 60 companies, including Scriptology and Vivid Health. The new fund aims to address challenges such as healthy aging, interoperability, and expanding sites of care. This funding underscores investor confidence in tackling the $4T healthcare market's persistent challenges.

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Taking stock of primary care today and looking ahead.... Increasing presence, market share for non-traditional providers - payers, advanced primary care providers, primary care enablers. Question marks over retail's presence in primary care and what care models and patient populations they might need to focus on to be a force. #VBC #populationhealth #primarycare #caremodels

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✅Our healthcare report and market map are finally live✅ Over the past several months, I have shared with anyone who would listen that Michael Cardamone and I were in conversation with innovation executives across four of the top healthcare systems in the U.S. including Mayo Clinic Ventures, Hackensack Meridian Health, Cone Health Ventures, and University Hospitals Ventures to understand current strategies and priorities in order to hone in on our investment thesis. The goal was to arm healthtech founders with the inside perspective on the critical investment areas for US hospitals to help establish product-market fit and solve the industry's most pressing challenges. Links to download the report, check out the market map, and submit your company are all in the comments. Thank you to our contributing experts Shai Ran Sapir, Technology Development Manager at Mayo Clinic Ventures, Sandra Powell-Elliott, Chief Innovation and Commercialization Officer at Hackensack Meridian Health, David Heenan, Managing Director at Cone Health Ventures, and Matthew Zenker, Director of Deal Flow and Investments at University Hospitals Ventures. #healthcare #innovation #healthtech #earlystage #healthtechfounders #healthcarestartups

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***From Best Practices to Next Practices*** This article from Jon Warner and Jomo Kenneth Starke discusses the shift from Return on Investment (ROI) to Return on Value (ROV) in healthcare, emphasizing a holistic approach that includes innovation, impact, and investment returns. ​ ROV considers qualitative factors alongside financial gains, guiding organizations to align investments with their missions. ​ It encourages long-term perspectives, justifying patient capital for incremental value creation. ​ Challenges in quantifying non-financial returns are acknowledged, but the benefits of ROV outweigh them. ​ This framework aids in strategic decision-making, resource allocation, and partnership formation to maximize value for individuals and society. ​ #Healthcare #ReturnOnValue #Innovation #PatientOutcomes #Collaboration #nextgen #valueovervolume https://lnkd.in/gihZBhSY

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When the music stops we find out which emperor has no clothes. (That’s not how the saying goes is it?) Anyway, here’s the most basic way to look at private equity investments in healthcare (disclaimer: not all are bad!) Healthcare entity sells a piece of itself to an investment group. Let’s say it’s sells 50% for $100 bucks. Investment group (doesn’t matter which one, just choose a color and an object from nature and add Capital or Equity at the end 🤣) puts up $20 dollars and borrows $80 dollars, saddling the healthcare entity with crushing debt. (Works great when interest rates are low, not great when they skyrocket like they have the last couple of years.) Investment group needs to show a return. Easiest way to increase revenue: Raise prices. Don’t pay people what they’re worth. Squeeze them. Cut staff and services. Now you have overworked, underpaid healthcare workers who think they don’t have another option. Let’s say investment group manages to sell their piece for $120 bucks in the usual 3-7 year hold period for private equity. (Remember they only put up $20 and borrowed $80.) Returns the money they borrowed, and keeps the profit. In this scenario it’s basically 100% return on investment. Investment group gets rich. Healthcare entity owners get rich. Patients and healthcare workers suffer. Anyway, Dr. Hal Inc is also a healthcare consulting firm. Follow me for more tips and tricks on what NOT to do in healthcare! (Shameless plug!)

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California Bill Would Require State Review of Private Equity Deals in Healthcare — Consumer advocates and labor unions are enthusiastic about the plans, but hospitals are not A bill pending in California's legislature to ratchet up oversight of private equity investments in healthcare is receiving enthusiastic backing from consumer advocates, labor unions, and the California Medical Association, but drawing heavy fire from hospitals concerned about losing a potential funding source. Hopefully, more states will initiate the same approach to keeping close tabs on private equity buying healthcare-related entities. Private equity firms raise money from institutional investors such as pension funds and typically acquire companies they believe can be run more profitably. Then they look to boost earnings and sell the assets for multiples of what they paid for them Critics say the profit-first approach isn't good for healthcare. Look to Stewart Health Care where the CEO and C suite lined their pockets while driving the health system into the ground. "Almost all of the most distressed U.S. healthcare companies are owned by private equity firms." Time to rein in private equity vultures out there in healthcare trying to make a quick profit, raising the costs of healthcare in their quest to generate profits. #privateequity, #runningthehospitalintotheground, #vulturecapitalist, #forprofithealthcare https://lnkd.in/ea3pFz43

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The biggest topics in healthcare last year? The two Gs. GPT and GLP-1s. We’re continuing to innovate our GLP-1 care track, which includes personalized care from care teams supported by AI tools, that can help maximize outcomes for someone on a GLP-1. And what’s to come? I expect this year we’ll see: ⭐ Measuring digital health programs will shift (check out Omada’s VOI report for more on this) ⭐ Consolidation in the market - not all digital health companies will survive ⭐ An uptick in PBM and health plan partners to help employers offer GLP-1s with sustainable coverage plans Anything I missed?

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We all have seen by now that AI holds the promise of reshaping healthcare delivery, and this goes particularly for marginalized communities. Its widespread adoption, however, necessitates careful navigation of potential biases and ethical concerns to ensure equitable outcomes for all! As we embrace AI's transformative potential, we must continue to actively address issues of access, transparency, and workforce readiness in order to promote a future where technology enhances, rather than hinders, health equity initiatives. #HealthEquity #Healthcare #AI

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The global fertility industry is growing - as are the remarkable tech and scientific innovations that enable it. The market was valued at $1.58 billion in 2023 and is projected to hit $2.96 billion by 2032 (USD). But it remains a deeply complex and misunderstood part of the health sector. We are lagging far behind from a policy development and patient needs perspective. Brighton Group Health #fertility #patientexperience #healthinnovation #healthpolicy

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Next week a who's who of health tech will descend on San Francisco for JPM. Amidst the buzz, Blue Shield of California announced a new CEO, Lois Quam, and a new nonprofit parent company, Ascendium, with Paul Markovich at the healm. The new parent company will build and expand new healthcare solutions and pharmacy services "with the goal of sharing these innovations with other like-minded health plans" In our conversation last November at HLTH Inc. Paul talked about a major component of the opportunity ahead for Ascendium: what's broken about the drug market and how to fix it Episode link in the comments

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"Hopes to rein in private equity investment in healthcare died in California last weekend." Patient care is more than a process; it is a profound human connection built on trust. Dr. Zirui Song, a healthcare policy professor at Harvard University and a general practitioner at Massachusetts General Hospital, highlights this essential aspect of healthcare. #PatientCare #HealthcarePolicy #HumanConnection #PrivateEquity

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