Coley is the Founder and CEO of Friend Health, a risk-bearing organization that deploys multi-disciplinary care teams and proprietary technology to bring in-home primary care to patient populations that need it the most. Friend Health works with some of the sickest and highest risk populations, collaborating with their partners to drive reimbursement, better outcomes, cost savings, and the efficient deployment of those resources to patients most in need.
TIM: Like many healthcare entrepreneurs, you founded Friend Health because of a personal experience with the healthcare system that wasn’t good. Tell us about that, and how it led to you starting the company.
COLEY: In the late 80’s, my father had a valve replaced in his heart. He got one of the first human valves, which was fantastic at the time. In the mid-2000’s he started going to the hospital a lot – he had a pacemaker put in, a defibrillator put in, and ultimately was placed on the heart transplant list. He had become an ER super-utilizer. He was in and out of the ER 2-3 times a month by the end of it, and when he’d be discharged from the hospital, that safety net that was supposed to be there via the Visiting Nurses Association and home healthcare just didn’t exist in the way that it should. The local home healthcare companies were a black box on information for my family, my dad’s cardiologist, and his PCP because they have had no incentive to update their technology or business model. They operate on ‘check-a-box’ healthcare: do 5 visits, get paid $2,500 from CMS, and then be on their way. There was no longitudinal care or coordination. My dad was chronically ill, not sick within neat 30 or 60 or 90 day boxes, and neither are any chronically ill patients. They’re sick over a long time period, so we should be seeing them on a longitudinal scale. So our real idea is: how do we deliver a better, more friendly patient experience over the long term, rather than these little boxes that don’t work. Because at the end of that 30 days, my dad is still sick.
TIM: A lot of companies have come at this as a consumer play, but you guys have opted to go after the enterprise. Why? And how has that gone for you so far?
COLEY: We have always been focused on going where the patients are. So, if you’re looking at it from a business standpoint, there’s a very high customer acquisition cost to getting somebody to download your app, then getting them to upload information about themselves so you can go to see them when they’re home. Everybody’s trained from when they’re a 1-year-old to call 911 or know where their doctor’s office is.
Not everybody goes to the App Store to look for healthcare when they’re sick. So we wanted to go to where the patients are; that was always partnering with institutions that need help getting care to their patients fast to close gaps in care – plus, by forwarding the data, we can provide a window into the home of those patients. For us, those partners are at-risk health plans and health systems. Health plans obviously own the patients who are the most at-risk. So we’ve seen the most success going to them in order to close gaps in care on their behalf, because their care management teams are in the flow, right? The care management team knows the languages their members speak, they know the chronic conditions these patients have, and they know where they live. They just don’t have the capability or anyone in their market that can operate at the speed and cost that they need.
TIM: Medicare, Medicaid and dual-eligible patients are responsible for a staggeringly large portion of healthcare spend. Without sharing anything too proprietary, how is Friend Health approaching care for these populations?
COLEY: We talk a lot about reactive versus proactive care here. Reactive care is where a patient walks through the door of their PCP’s office or ER, and the MD or NP works backwards to figure out why they are there. Proactive care is all about delivering intensive care management programs to complex patients tailored to their chronic illnesses that can change behavior and improve health outcomes. Offices and hospitals are set up to be reactive, and they are a necessary tool in the healthcare landscape, but they shouldn’t be the go-to choice for patients because they are incredibly costly, and are at capacity. Medicare and Medicaid patients are often homebound because they are no longer driving a car, or don’t have the money for a bus ticket to get to their PCP office, which means it is very difficult for them to be proactive about their own health in the necessary way to get better outcomes. On a fundamental level, Friend Health is set up to provide proactive healthcare. We are using integrated teams, which means NPs, RNs, behavioral health tools, and health coaches, who are working as a unit on managing the health of complex individuals that need intensive, high-touch care. We deliver it at the lowest cost location, the home, which also solves the access to care problem for many Medicaid patients that live in healthcare deserts, and we use technology to streamline every step of the process. This is all in an effort to keep patients healthier and out of the hospital. So, you can say that we are thinking about Medicare and Medicaid populations a lot!
TIM: There’s been a ton of talk for a long time now about shifting away from a fee-for-service model to value-based care, and VBC can mean different things to different people. What does it mean to you, and to Friend Health?
COLEY: At it’s core, value-based care is trying to align the same incentives of who’s ethically responsible for the patient, with who’s financially responsible for the patient. Healthcare for a super long time has been in fee-for-service land, where they’re not necessarily – even if they’re not ethically responsible for that patient – are they keeping the patient’s best interest in mind? Because financially they’re incentivized to do something else. And humans just on a basic level and on a business level are going to go where the incentives are. So if we can realign the incentive structure in healthcare – it’s an extremely positive thing for the patient, because you’re aligning ethical and financial incentives in the same way. So if the doctor or health plan or hospital system can get reimbursed properly that’s good for everybody… but especially the patient. That’s how I think about value-based care in general: if you can align ethical and financial incentives, the patient is better off.
TIM: You mentioned health systems and other managed Medicaid organizations, but you have an anchor enterprise customer, and it’s a rather large system with an affiliated MA plan. What have you learned from partnering with that kind of organization.
COLEY: It’s a partner that’s all the way along the risk spectrum. They’re an MA plan and a managed care organization, with 50,000 members that they’re responsible for. So, their goal is to figure out how they can pay the least amount of money for them because that means that the patient is healthier and they aren’t over-utilizing the hospital. We have over 50 practitioners in that state now, basically full coverage across the state for our partner, and we’re going to be working directly with the care management teams giving them a new superpower: the ability to walk through the walls of their members’ homes. What I have learned is how dedicated our partner is to their members. They want the best for them, and they know that they can’t just be ‘takers of bills,’ they need to be ‘givers of healthcare.’ And that’s what they’re using us for: proactive healthcare, not reactive healthcare. We’re giving them a new tool to be proactive about going out and giving something as simple as a flu shot, or running the A1C on one of their diabetic members, or doing an anti-depression screening, a fall-risk screening; all of that can be done in the home – as they gather more data about the patients, they’re also delivering higher quality healthcare. As a result, they can get higher quality scores, healthier patients, lower costs, bonuses, and it works out for everybody, but especially the patient.
TIM: Up until this point, what has been your biggest challenge as an entrepreneur, and what keeps you up at night?
COLEY: Besides everything?
The obvious things keep me up at night: competition, are we moving fast enough, etc. etc. But we are at an inflection point now where I am transitioning from doing everything, to managing really talented people. I am lucky to have hired some people that are much better than I am at many things.. My jobs are to keep money in the bank, manage our spend, hire amazing people, set goals, and build a culture. Most importantly, it’s building a culture and hiring the right people who fit into that culture. And that’s what really keeps me up at night. Can I empower the people I’ve brought on to be the best version of themselves, and think openly and honestly about the problems that we are trying to solve. I’m bringing in people who have clinical backgrounds and saying to them, ‘Hey, remember everything that ever worked for you? Let’s do that. And remember everything that everyone told you that you couldn’t do, but you wanted to do? Let’s also do that, too. And we’ll A/B test it, and we’ll know that we’re giving the best care to our patients. So, I’m sort of like head-cheerleader at this point (laughs). But what keeps me up at night is whether I’m finding the right people and whether I’m building the right culture to keep people as open, transparent, and thoughtful about what they’re doing as they can be.
TIM: Which is a decent segue into how you think about culture, hiring for it, and the role that those leaders will play in your success…
COLEY: I think a lot about it. Luckily I have a great team that helps me find great people – you guys (laughs)… but once I get a steady flow of people, it’s my job to set up a process by which we are looking at people on fundamentally the same spectrum so that we can compare people equitably and make sure they are great. You guys have helped us tremendously with that. And I do think there are certain personality types that work well with each other, and the number one thing that I don’t want to see – I’ve seen really smart people that may not have the right personality to work in a culture like ours, which is an open culture, which is a “yes-and” culture – is people who don’t bring positive momentum. We want to attack challenges by finding the ways over the hurdle, not just presenting new hurdles. And when the hurdle comes up, we find another way over that hurdle. So, it’s an optimism thing. If you have somebody who is constantly coming up with the “no’s,” but not providing a way through the “no,” that just becomes a vampire sucking the energy out of the company. And that’s the biggest thing we’re trying to keep away – we’re trying to keep the vampires at bay (laughs).
TIM: Killer analogy (laughs). So big picture, what’s the longer-term vision for the company?
COLEY: Longer-term vision of the company is – I fundamentally believe, and I’m not the only one that does – that hospitals of the future are going to be used for catastrophic care. Doctors will stay there, they will write white papers there, and they will orchestrate on a grander scale what is happening outside the walls of the hospital, because everybody 10 years from now will be in a value-based care scenario somehow. Much more than they are today. That’s where I believe the ball is going and that’s where we’re going to be to catch it. So in that scenario, below the hospital you have care management teams, care coordination platforms, and artificial intelligence which is taking care of a population who is 99.9% of the time in their homes. We should be delivering care there. So within that, if that’s the way we think it might be going, there has to be this network of mobile practitioners who see patients when escalations come, and it will be surrounded by data that’s being pushed back and forth with, ideally, interoperable EMRs – please, fingers crossed – and you can use decision trees, artificial intelligence, machine learning to red-flag vitals and other signs of something amiss. All that will be monitored by MDs and specialists, so we’re not cutting out the doctor – they will be able to see more patients in a more effective way via technology. Ultimately if we can transition to the lowest cost point of care – which is in the home – where 88% of people over 65 want to remain instead of in a SNF, or in a nursing home, then we’re doing a lot for decreasing the massive amount of healthcare spend, increasing how happy people are in the twilight of their lives. And that’s where I see Friend Health, in that band in the middle there, of providing care in the home via human touch and technology.
TIM: What do you want the market to know about you that they might not already?
COLEY: Maybe that we are way more than “Uber for Nurses” (laughs). Seriously, though, there are elements of that in our technology, but everything we build and do comes from a clinical place first: “Does this get us to our end goal of better clinical outcomes.” Because if we get that right, we make a major impact.