You can’t call an 18-year-old company a startup, so Valence Health doesn’t fit into that category. However, news from the Chicago company this year has been as exciting and impressive as developments from any new HIT company working to change the system.
The company just raised a nice round of funding – $15 million and only the second in its history.
The week before the funding round closed last month, Valence announced a new deal with Humana – a plan to help the insurer move its Medicare Advantage customers from fee-for-service contracts to value-based care.
Even better, revenues from the first half of 2014 were up 51% compared to the same period last year. The company has been hiring, too, adding more than 150 employees this year, and planning a move to a new national headquarters.
That’s a lot of excitement for a consulting firm that’s been around for awhile.
The company even has an altruistic mission: to help providers take charge clinically and financially of their work. Valence Health President Todd Stockard said that his company doesn’t work for any for-profit hospitals.
“They’re the dark side, and we are mission oriented to help providers be successful in this country,” he said. “It also quickly becomes a conflict of interest for us.”
A Deep-dive Into Specialty Pharma
A specialty drug is a class of prescription medications used to treat complex, chronic or rare medical conditions. Although this classification was originally intended to define the treatment of rare, also termed “orphan” diseases, affecting fewer than 200,000 people in the US, more recently, specialty drugs have emerged as the cornerstone of treatment for chronic and complex diseases such as cancer, autoimmune conditions, diabetes, hepatitis C, and HIV/AIDS.
Valence helps hospitals roll out population health strategies, integrate data from health systems and independent doctors and move to value-based care contracts.
Stockard and CEO Phil Kamp founded the company in 1996 and raised its first round of $30 million in the summer of 2012. The current round was led by Heritage Group in Nashville and included Foundation Medical Partners, GE Ventures, and North Bridge Growth Equity.
Kamp said the new funding will go to expanding software development, sales and marketing, and client management resources.
“This latest round of investment allows us to accelerate our efforts to reach more providers who are pursuing various approaches to value-based care,” he said.
With the Humana deal, Valence will help the insurer improve its population health capabilities and work with their providers to deliver software and analytics.
Humana had 2.4 million Medicare Advantage members last year and increased that number to 2.8 million members this year. Medicare Advantage plans are a high priority for the insurer and total subscribers is expected to exceed 3 million next year.
Humana has more than 900 Accountable Care relationships across 43 states and Puerto Rico that include 38,000 primary care physicians.
