Key Themes for Healthcare Investments in 2015


As investors and operators alike flock to San Francisco next week for the annual JP Morgan Healthcare Conference, it’s timely to assess the landscape of strategic healthcare initiatives and investment opportunities that will likely shape deal making activity in 2015.

This past year has been characterized by accelerating investment across the industry, largely driven by a highly attractive lending environment and increasing clarity about what a post-reform healthcare world looks like, who the winners and losers are, and what investments need to be made in order to thrive.  We believe that all constituents will further refine their thinking in 2015 around three key areas:

  • Cost Containment and Care Coordination. The shift from fee-for-service to fee-for-value necessitates effective cost containment and care coordination strategies.  Member / patient centric evidence-based methods that drive clinical and operational efficiency and efficacy across multiple sites of care are critically important for payers and providers to optimize their performance.  In 2015, we expect significant attention to be paid to care navigators, bundled payment conveners, and companies that facilitate the effective care management of high acuity populations such as Duals.
  • Quality Enhancing Care Delivery Models. Demographic and regulatory tailwinds are facilitating a shift in the way healthcare is delivered.  The growth of chronic diseases, an aging population, Medicaid expansion, the individual mandate, rapid appreciation of defined contribution / private exchange adaption, and payment reform are just a few of the dynamics that change the profile of the population that needs care as well as change the methods through which care is delivered and reimbursed.  We expect investment to follow the flow of volume – lower acuity community-based settings, alternate sites of care, behavioral health, specialty pharma, and other related settings are all areas that will see increasing focus and attention.
  • Technology-Enabled Healthcare. Technology is irrefutably linked with the delivery and management of care.  While the market for technology-enabled outsourcing solutions serving the payer and provider community has thrived for years, we are increasingly seeing market interest in solutions that directly serve consumers and employers.  Consumer engagement, price transparency, medication therapy management and adherence, remote monitoring / surveillance, Star Rating optimization, and technology enabling the distribution and administration of benefits are all highly attractive areas for investment.

We look forward to helping business builders and financial sponsors understand and align around these themes in the weeks and months ahead.

See you in San Francisco!

Justin Fengler
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