Former ONC chief launches startup

'I see no reason why we wouldn't be the largest provider of primary care in the country in six years'
By Bernie Monegain
07:00 AM
Former ONC chief Farzad Mostashari, MD (Kaiser Health News photo)

With characteristic poetic flourish and $4.5 million in seed money, former ONC chief Farzad Mostashari, MD, today launched Aledade, a startup aimed at helping primary care doctors "do well by doing good," he said. To that end, he will help physicians form accountable care organizations.

The poetry is inherent in the company moniker.

"In celestial navigation, the same thing that you point to the North Star, that's the aledade," Mostahari explained, adding, "I didn't pay a branding company to come up with that. That was me."

"Empowering doctors on the front lines of medicine with cutting edge technology that helps them understand and improve the health of all of their patients has been the mission that's animated my career," said Mostashari in announcing the launch. "That's Aledade's mission."

[See also: Mostashari: A look back at the headlines.]

"Long-term, even medium-term, I want us to really help independent primary care practices throughout America be put back in control of healthcare, and have an opportunity to do well by doing good – to actually get paid like quarterbacks – to capture the value they create in better chronic care management and prevention," he told Healthcare IT News. "If we can show that value proposition to the payers, to the health plans, to the patients and to the doctors, then I see no reason why we wouldn't be the largest provider of primary care in the country in six years."

As Mostashari, who recently completed a fellowship at the Brookings Institute Engelberg Center, explains it, Aledade will help physicians in all types of communities across America preserve their autonomy, deliver better care to their patients, reduce overall costs and keep their independent practices flourishing.

[See also: Mostashari to join Brookings Institution.]

Aledade ACOs are networks of primary care physicians who band together to deliver coordinated care to their patient populations. They operate under a payment structure designed to reward patient outcomes rather than solely paying doctors based on the number of tests, procedures or office visits completed.

When ACOs successfully deliver high-quality care at lower cost, they share in the savings through payments from the health plan. Physician-led ACOs have been proven to work, Mostashari noted: In the first year of the Medicare Shared Savings Program, 72 percent of the ACOs that achieved savings were physician-led – underscoring a huge potential for small, independent medical practices to adopt this model.  

"It turns out that 21 out of the 29 successful Year 1 ACOs were physician-led," he said. They weren't hospital sponsored, they didn't have hospitals. And the reason for that is twofold. One, the patient can be a lot more agile, and, two, we don't have to worry about reducing income. If a hospital reduces admission, they lose revenue. If a hospital reduces unnecessary or avoidable emergency room visits or catheterization or expensive procedures, they lose revenue, whereas primary care docs don't.

Aledade has already initiated partnerships with primary care physicians in four targeted regions across the country – Delaware, Arkansas, Maryland, and the metro New York area.

Cutting-edge technology platform

An electronic health record is necessary, Mostashari said, but it's not sufficient.

"One of the things we're going to do is we're going to go in, and we're not going to go in and rip and replace anyone's EHR, but we're going to optimize the hell out of them," he said. "That's always been the step that was missing, right? That's what was always frustrating to me. We knew that the EHRs were capable of more. Yet, you know, sometimes the vendor gets paid for just putting it in, not for optimizing it. That's what the practices really needed – to optimize for efficiency, for population health, for workflow.

"There's a whole series of tools that we will build or buy to help manage the population risk – so predictive modeling, figure out who's going to be admitted to the hospital, integrating clinical and claims data into that," Mostashari added. "It's the network analysis, figuring out who you want to refer, are they actually following through on the compact they've made, it's admission/discharge/transfer notification; and it's patient relationship management."

Co-founders and investors

Aledade's co-founders are: Executive Vice President Mat Kendall, who led the government's Regional Extension Center Program to help doctors adopt and use EHRs, during Mostashari's tenure at ONC; and Chief Technology Officer Edwin Miller, who has launched more than 30 healthcare technology products, and was the key product designer for three successful cloud-based electronic health record platforms.  

Bob Kocher, MD, partner at Venrock, the venture capital firm that funded the startup, will join the Aledade Board of Directors. Bryan Roberts, also of Venrock, will serve in an advisory capacity for the company.