Investors are continuing to funnel big bucks into alternative payment models. The latest example of this comes from Pearl Health, a New York City-based technology company that helps independent physician practices participate in value-based care models.

The startup, which was founded in November 2020, on Thursday announced that it raised $75 million in its oversubscribed Series B funding round. The round was led by Andreessen Horowitz’s growth fund and Viking Global Investors, with participation from AlleyCorp and SV Angel’s growth fund. The round brings Pearl’s total funding to date to more than $100 million.

Pearl was founded to make it easier for physicians to shift from payment models in which they are compensated for delivering services to models that pay them based on outcomes and managing the total cost of care, CEO Michael Kopko said in an interview.

“Think of us as software as a service that takes on risk with doctors so they can transform,” he declared. “That’s a little bit different than the classical models where people would say, ‘We’ll just buy or employ the doctors, and that’s how we’ll get behavior change. We’ll just tell them that they’ve got to behave differently.’ Instead, our view is that you’ve got to give doctors different information and deliver it in a more modern and technology-focused way.”

Pearl’s platform leverages data science to help primary care providers focus on patients who are driving expenses and need care the most. 

The startup collects data from multiple sources, including health plans, hospitals and pharmacies. The platform synthesizes this data and delivers it to physicians, highlighting patients who need attention and creating an action plan for preventive, personalized treatment.

“We highlight patients that are driving expenses and have extreme conditions,” Kopko said. “Then we integrate that into a population and panel view that helps our physicians prioritize patients that are sick and chronic. It helps get their medical experience as well as their costs under control.”

Using Pearl’s platform does not require an EHR integration. After a customer is onboarded to Pearl’s platform, using the service can be as simple as website sign on, Kopko pointed out.

In 2022, Pearl went live with its platform with 75 physicians, 25 practices and 4,000 Medicare lives. Now, the startup has 804 physicians from 120 practices across 29 states on its platform. These physicians care for about 43,000 Medicare-covered lives.

With this new round of funding, Pearl is hoping to maintain this growth. The company will use the money to grow the number of physicians on its platform, as well as enhance its technology to have more data streams.

Though Pearl is enjoying growth at a rather quick rate, it is certainly not the only company out there designed to enable value-based care. There’s also companies like Agilon Health, Privia Health and Aledade, to name a few.

Kopko said that Pearl stands apart from all of these companies. The startup is different from Agilon because that company is more focused on aggregating patient lives and helping large practices to get better deals with payers, he said. As for Privia, the company has historically required customers to integrate their EHR, Kopko declared. This made it difficult for practices to adopt, as many were required to switch their EHR provider, he said.

“[Privia’s] model is evolving because there are limitations to making physicians change their EHR. But we’re much more platform agnostic, and much faster in terms of our ability to turn on,” Kopko said.

When it comes to Aledade, the company has been focused on the Medicare Shared Savings Program, which Kopko called an “older generation value model.” However, Pearl is focused on the ACO REACH model, which Kopko believes is a more patient-centric model from the Centers for Medicare & Medicaid Services.

Photo: Hong Li, Getty Images