The AI-Powered Future of Value-Based Care

THL’s Healthcare in Action, Season 2, Episode 5

Value-based care promises better outcomes and lower costs, but making it work in the real world requires more than good intentions. In this episode, Jon Lange speaks with Jay Ackerman, President and CEO of Reveleer, about how fragmented healthcare data, operational friction, and the sheer complexity of the US healthcare system have slowed progress—and how smarter analytics and AI can help unlock the full potential of value-based care. Jay explains how Reveleer turns messy clinical data into actionable insights for payors and providers, helping them improve quality, cost, and outcomes for patients. He also shares lessons on leadership, culture, M&A discipline, and the personal experiences that keep him focused on building a more connected and effective healthcare system.

Key Takeaways

• Reveleer helps payors and providers translate fragmented clinical data into actionable intelligence that supports risk adjustment, quality improvement, and stronger financial performance in value-based care.
• Providers face major operational complexity, as they often work across fee-for-service and value-based models, while also managing a variety of incentive structures across multiple payors.
• Reveleer’s Hybrid AI approach uses Gemini alongside a clinical rules engine to surface highly precise insights at the point of care, reducing noise and helping clinicians focus on what matters most.
• Jay’s approach to M&A is product-led and highly disciplined, with acquisitions focused on filling strategic gaps rather than just adding revenue or customers.
• Strong leadership in healthcare IT requires constant attention to culture, team, and strategy, along with a deep understanding of real healthcare problems and their real-world impact on patients.

[00:00:00] Jay Ackerman With our clinical data, we can not only ensure that the patient is properly cared for, but we can also isolate where they may have spend issues with providers. So the right care earlier, but also ensuring that the care that’s given is the appropriate care in that setting. 

[00:00:19] Josh Nelson That’s Jay Ackerman, the president and CEO of Reveleer, and I’m Josh Nelson, Head of Healthcare at THL Partners, and this is Healthcare in Action. It’s a podcast that explores the latest developments and innovations transforming the U.S. healthcare sector, from cutting-edge technology to thoughtful approaches to patient care. I’m here with my partner, Jon Lange, who will lead us in a conversation about value-based care, and how the latest technology and AI-powered solutions are helping providers and payers deliver better care for patients and better value for the healthcare system. Jon, take it away. 

[00:00:57] Jon Lange Thanks, Josh. Value-based care has been talked about as the future of healthcare for decades, but actually realizing that vision has proven to be harder than expected. The shift away from fee-for-service toward better outcomes and lower costs sounds straightforward, but in practice, it’s been held up by everything from messy data and poor interoperability to the sheer complexity of change management. But there’s reason to be optimistic, thanks in part to recent advances in technology and AI. One company helping lead the charge is Reveleer. Its technology solutions draw on the latest AI tools to help payers and risk-bearing providers understand their populations, close care gaps, improve star ratings, and streamline workflows. In today’s episode, I spoke with Jay Ackerman, the CEO of Reveleer. During his 10 years at the helm, Jay has driven significant growth and product expansion through a combination of internal development and M&A. And Jay and his team have transformed Reveleer’s offering into an end-to-end solution that allows customers to harness an expanding sea of data to provide better care for patients and better value to the system. Jay and I discussed the complexities that have held value-based care back, how leadership and culture matter in scaling innovative companies, and how AI is beginning to unlock meaningful opportunities for the future of value-based care. So let’s get into it. Jay, thanks so much for joining me. 

[00:02:28] Jay Ackerman I’m delighted to be here, Jon. 

[00:02:30] Jon Lange Maybe to start out, would you just tell us a bit about Reveleer? 

[00:02:33] Jay Ackerman Yeah, I mean, I’m really excited to talk about Reveleer today. We are a data and analytics platform that’s powering value-based care. And what we try to do is take fragmented data, and there’s so much data inside of healthcare, and we turn that into actionable intelligence for health plans and providers to help them succeed in value-based care. We help them succeed in areas like risk adjustment, quality improvement, and revenue performance. 

[00:03:02] Jon Lange Great. And to make that even more concrete, can we take an example of a payer customer, for instance, and what problem were they facing before they adopted Reveleer Solution and how does Reveleer solution address that problem? 

[00:03:17] Jay Ackerman Yeah, so I’ll take one of the problems that they’re faced with, and one of those problems in value-based care, a payer is paid a capitated amount per month for every member that they cover. And that amount is dictated by the health burden of that patient. You’re an older man with a number of chronic conditions, you’re a younger female Medicare who is super healthy. Like the amount paid by the government to the payer will be different for those two patients. We help the payer accurately define that health burden based upon historical clinical data and allow them to submit that to the government so they get paid the right amount, and the government knows that that amount is accurate and correct and valid for the health score burden of that patient. 

[00:04:10] Jon Lange Got it. And I think that’s a really interesting point about value-based care more broadly, where it’s easy to think about value-based care in an abstract sense, but unless you know the acuity of the patient, what’s wrong with the patient? It’s really hard to know what value even means. And so one thing you’re doing with your solution is bringing the data to bear to give the payer and the government a really accurate sense of what the issues are with the patient so that they can deliver effective care and also care at a good value. 

[00:04:47] Jay Ackerman Yeah, and using our data, you can also identify where, if you’re a payer, where providers may be taking courses of delivery that are more expensive than they need to be. They’re taking more aggressive action than their peer group. And so with our clinical data, we can not only ensure that the patient is properly cared for, but we can also isolate where they may have kind of spend issues with providers. So the right care earlier, but also ensuring that the care that’s given is the appropriate care in that setting. 

[00:05:26] Jon Lange And it may be related to this point, one trend we’ve seen over the past decade or more is more providers taking risk. And so how does that play into this landscape? How are risk-taking providers engaging with this data? And how is it different from their perspective versus just a typical MCO? 

[00:05:47] Jay Ackerman The fascinating thing about providers taking risk, the reality with most providers is they still straddle two worlds. They’ll straddle a world of value-based care where they’re taking risk and that risk can be kind of upside risk, downside risk, right? Like it comes in all sorts of flavors. But then they also have a cohort of patients that are still traditional fee for service. And that’s part of the challenge is when you’re living in two worlds, it’s hard to do both, and you’re a provider, providers are challenged on the tool front, they’re challenged in terms of like where they invest their dollars and what infrastructure they can put in place to support them. And so many wanna take risk, and then they find themselves kind of unequipped to manage that environment. What does it mean to take risk? How do I know where I stand on a quality bonus? So for that provider, what we’re aiming to do with that provider, so on the quality incentives, we work to ensure that they know exactly what bonus is there for them around each patient. And that varies by payer. So again, there’s another complexity. You’re a provider, you live in fee-for-service, and you live in value-based care. Okay, now come over to the value-based care world, and you could have patients under a national payer like United. You could be a provider in a market, and you’ve got a set of contracts with like a local blues, and you might also work with like a regional not-for-profit payer, and all of them have different incentives and bonus structures that they are focused on. And so we try to simplify that so when Jon walks in to see your doctor, and that doctor gets a trigger inside their EMR that says you need to pay attention to these three things. One could be about confirming. Some chronic conditions that have been there, like do those still exist or not? And the other might be about a care plan that’s tied to a quality bonus. And so you would see an alert pop up in your EMR, triggered by insights from us, that doctor is able to confirm it. So they’re able to close that care gap, like it’s pushed back to the payer, the payer is able to submit and do their part in value-based care, and the provider does their part, they get paid for it, they’re doing a wonderful job and providing care to you, and both parties win. But that’s super complex, because they’re living in different worlds, because they work across a number of payers. The average provider, and I think you know this probably better than I do, the average provider probably has contracts under seven or eight different payers. 

[00:08:25] Jon Lange Yeah. It is the wild west in a sense, particularly as you describe, since every payer has different arrangements, different contracts, different priorities. And I think that highlights a really interesting point related to this whole ecosystem, which is it’s easy to talk about the benefits of value-based care, but it can create a real headache for providers and patients, but maybe particularly providers. And so, you know, you didn’t go to medical school as a provider, or you didn’t become a nurse as a provider to try to manage seven different payers in their incentive schemes. And so in order to make this all work, at least in the current environment, you really need not only data, but tools to make that easier for the provider to manage. 

[00:09:09] Jay Ackerman I mean, look, Reveleer exists and Reveleer thrives in a market because of the complexity of our healthcare system, because data doesn’t flow swiftly, and without friction across the healthcare landscape, and because we don’t also operate in a one-payer system. And I think that’s great. I mean, it creates complexity, but people have choice. And, you know, I think where there’s choice, like there’s innovation, and where there is innovation, great solutions are surfaced. 

[00:09:47] Jon Lange I think that’s a good segue in that in addition to the data you’re providing. You are providing insights and analytics and workflows on top of that. And that’s been an increasingly hot topic in the age of AI. You introduced a new product last year built on Gemini. And so can you talk about that process, that product, and how it’s being received in the market. 

[00:10:12] Jay Ackerman Yeah, so we we did introduce a new product last year called Hybrid AI built on top of Gemini. And we work with a number of the kind of the hyperscalers. And so we’re, say our chips are not all in one basket, but we’re really excited about the Gemini basket. But on top of that we use Gemini to help us most precisely read a clinical record. And when you think about a patient record, like the average record might be 30 pages, okay, for like a Medicare Advantage member. But there are clinical records on patients that are 10 to 30,000 pages long that you’re trying to kind of run through an AI and surface, you know. Like I said, two or three really critical insights. So we use Gemini to extract data. We call it kind of our evidence extraction engine. Reads the whole record. It kind of lifts the words, the numbers off the page because often this data is PDF. Evidence is extracted, and then we have this 1,500-plus kind of rules engine that sits on top that’s got kind of 30 plus years of clinical expertise built into it where we then filter. And those two work together to filter and surface those and sub five insights to a doc. And when you talk to a provider, they want precision. They don’t want to be distracted with like, hey, we kind of think this might be going on. They want, I know this is going on, and so one of the things we’re most quickly judged on is that level of noise. How many things are we surfacing that a provider says decline, decline, decline. And I would say kind of broadly across our customer set, they’re expecting kind of an 85 plus percent precision rate, meaning only 15 percent of the things are they saying, like, look that’s not relevant. I think one of the other points I wanted to call out, because I think it’s true for both payers and providers, when you think about value-based care, you want to make sure that the member’s getting proper care, that the member’s risk burden is properly documented, both parties kind of make choices about who to focus on. And they have to make choices because of time and the cost going into that. And so the more that we can bring AI to the forefront to take the cost down, to kind of speed the work up, the bigger the population of people they can focus on. And I still struck by a conversation I had with the chief medical officer of Blues plan. It was probably seven years ago when we were talking. We had this kind of conversation, and he said, hey, if you can drive our costs down, each kind of like major step function move and taking the cost down, I can focus on a larger set of my members. And so, if we, if we really drive it down to the kind of the lowest possible cost, like no member or patient kind of gets left behind. 

[00:13:33] Jon Lange That’s a great point. I think that isn’t talked about enough, with respect to the opportunity for AI and innovation, where I think there’s a lot of talk about AI building new products or lowering costs or reducing burnout. But the other side of that, is if you can lower costs, and you can free up resources that can really broaden access and just deliver care to a bigger population of patients. I want to switch gears a bit and talk about M&A. And I know you’ve been really thoughtful about M&A and also really active. And so can you just tell us a bit about your framework for M&A, and how you think about finding the right deals, integrating them, and also being really disciplined. 

[00:14:17] Jay Ackerman Yeah. Well, that last word there I think is one of the most important is discipline. So we’ve been successful in expanding kind of our capabilities through four acquisitions. What has been behind our acquisition strategy, we have a product footprint that we believe we need to ultimately deliver to the market to fulfill our vision of being kind of the platform for value-based care. We crafted this view of that comprehensive solution footprint in 2021, and that’s been our guide ever since. And each of the four acquisitions have been kind of layered in against that and looking at where do we have a gap? And can we solve that gap through our own build or can we get there faster and maybe better through an acquisition? So, we’re anchored on a long-term vision. It’s number one. So two, it’s all product driven. Like we’ve never done one to acquire a book of business, a set of customers, top line revenue. Like that’s never been a driver. Those things have come with each acquisition. Everyone has come with some amount of revenue, some customers we weren’t doing business with. But the product gap is what’s driven it. So yeah, we’ve been disciplined. We’ve operated against a kind of a long-term vision of the footprint of the business, and we’ve looked for complementary companies. You know, look, that sounds like everything’s been kind of great. You know there’ve been, we’re chock full of learnings around it, what’s worked and what hasn’t. It’s hard to get the culture piece right, you know, when you’re in a, you’re in a process, you’ve got a banker that’s sitting between you and that company, and you’re trying to get close to assess the business, and you trying to use that window of time before you buy to kind of begin that kind of culture integration. But we’ve done four, we’re really proud of how that’s allowed us to solve problems more completely for our customers. But discipline, discipline, and discipline. We won’t overpay, we’ve never done an acqui-hire. It’s got to solve a product gap. It’s got to allow us to take a workflow that we support today, and make it more complete. 

[00:16:43] Jon Lange You mentioned culture and the importance of focusing on culture in an acquisition. How do you think about culture within Reveleer and driving the right culture to get real results and to build a great company? 

[00:16:57] Jay Ackerman When you think about a CEO, the job of a CEO, culture is kind of one of the critical jobs. You’ve got to put in place a strategy, and you got to pressure test that strategy regularly to make sure that you’re on the right path. You’ve got to continue to assess your team, and make sure that you’ve got the proper team for the next leg of the journey and you’ve gotta have culture. So for, think about the job as CEO, you want to boil it down to three things, you could boil it down to those three. For me at Reveleer, we talk about three values in the company. Customer first, make every moment matter in community. Okay, and that customer first, I do believe customer first over employee first. And that’s like, people love to debate that. My simple view, if you don’t have customers, employees kind of don’t matter. And like all the other stuff really doesn’t matter, right, if you’re not doing right by your customer. And so, you know, we’re looking for people that, like if there’s a customer opportunity, they see an opportunity to do something kind of different and bold and better. Like, they’re gonna bring it forward. There’s a customer issue. Like people are gonna tackle that, and they wanna get it done today, not tomorrow. And so how do you do that in the culture? You gotta put a spotlight on the places where you see that getting done beautifully. I surface the example, celebrate those people. So we had an all hands yesterday. We do a monthly all hands. Everybody in the company, 450 people come together. Some in person, the rest by video. Every single month we celebrate those who are going the extra mile. We put a spotlight all the time on the behavior that lines up with what we think we need to do to be successful. 

[00:18:39] Jon Lange And you also mentioned how you boil down the job of a leader. And can you just talk a bit more about that? What does it mean to be a leader of a healthcare company, of a healthcare IT company? And what do you think are the qualities that make a great leader? 

[00:18:57] Jay Ackerman So we’ll start kind of like bottoms-up, like setting the culture of the company. And look, continuing to look at that, and see how it needs to adjust and evolve as the company, you know, changes. The second is around team. Like you gotta always be assessing the team. Like, do you have the right team? How can you coach the team up? I talk about it, I think everybody has a ceiling, and it’s kind of up to you and your manager on how you lift your ceiling. And if you’re not taking proactive steps to lift your ceiling, at some point, you’re gonna hit it. And my job is to help lift it. And when I see people hitting it, like to make changes. And then the third is around strategy and making sure that the strategy that you’re executing is the right strategy. And so from a leader’s standpoint, you gotta be focused on those. I try not to solve other people’s problems. I’ve got to tell you, it’s one of those things that you battle. Like I’m a good problem solver. I think it’s been like a superpower of mine that’s allowed me to be successful. But when you step in and start solving problems, you weaken that capability. You also give people permission to step back. So my job as CEO is to help people get to better answers, but not to be the one solving the problem. I like to contribute, and I say I’ll put the jersey on, and I’ll get in the game with you, but I’m not going to take over the play calling. I think the job of a CEO is to be out in the market. This type of thing ties into strategy and looking for signals of what’s happening and to understand. So we’ve been talking about healthcare, it’s changing a lot. Value-based care, a lot of change coming out of DC. Are those headwinds, tailwinds? Should we be adjusting our strategy? There’s a lot to talk about for compliance. So it’s a job of the CEO to be in the out in the market. And paying attention to kind of how those winds are starting to shift. So you don’t wake up one day and find that the tide totally shifted on you, and you missed it. I think those are kind of the core, you know, jobs and roles of a CEO. 

[00:21:07] Jon Lange And in one sense, that’s really simple. You mentioned culture, team, and strategy. In another sense, that’s sort of all -encompassing and overwhelming, I imagine, for a new leader. And so maybe for a first-time CEO or even the manager of a segment or the manager of a bigger team than someone has managed before, what advice would you give them to manage their time appropriately, to prioritize that appropriately, so that they’re making the biggest impact.

[00:21:38] Jay Ackerman Yeah, well, we could write a book on that. The first time CEO, I think one of the piece of advice I give to every executive, one piece of advice is, create your own kitchen cabinet. Like I have a peer group of CEOs that I call on regularly and say, hey, how are you approaching enterprise AI? Like, how have you tackled that? And I foster that group. I nurture that. I get on an airplane, and go see one of them regularly, because we can go deep with each other really fast. So I have five to seven people that are super important to me. And I think at every level in the company, on the executive team, you need that. So if you’re a divisional president, I create your kitchen cabinet. Your CEO can help you do that. Your CEO can tap the board to help find some other appropriate stakeholders. And if you’re not doing that, you’re missing an opportunity to have some people that bounce ideas off that are outside of your world that can help you calibrate the ceiling that we were talking about. So that’s number one. Two, the piece on time, you have to control your calendar. And I was in India last week. I was asked like a similar question to what you just posed, like, hey, what advice would I would give? And one of the things I talked about is controlling your calendar. And so I have a routine. I over on the weekend. I look out over the next two weeks how my time is being spent. And if I’m in things I don’t think I should be in, like I’ll reach out to those folks who’ve asked me to be part of a meeting, and challenge whether I need to be there. I will proactively block time to do things that I need to do, right? Yes, my job, like that seems simple, but like strategy work, whether strategy work around a board meeting coming up. So I’ll block time on my calendar to do that, because if you don’t do that then it happens in the margin and working the margins usually not very good. One of my favorite hacks on the calendar side is I color-code my calendar. Really simple. And I’d love to say I created it, came up with it on my own. I read an article somewhere some CEO did this, and I read it years ago, and I’ve been doing it for a long time. And it’s just a very quick and easy way to see is your time being put in the places you wanna spend it. So talent for me is a key place. And that’s skip levels. It’s one-on-ones with my direct reports. It’s me talking to people in the market that don’t work here now. Maybe I want them to work at Reveleer in the future. Maybe I’m kind of wondering about a particular role and do I have the right person or how do I help that person be more successful? And so I’m talking to others in that same role that are maybe in bigger companies. And so like, I’ll look, like, am I spending enough time on talent? Some will say a CEO should spend 25 percent of his or her time on talents. Like pretty easy to see visually, are you doing that? 

[00:24:48] Jon Lange It’s all great advice. And a number of people watching or listening into this podcast will be just coming out of undergrad or business school, aspiring one day to be a great leader of a healthcare or a healthcare IT company. What advice would you give them in terms of experiences to pursue or qualities that are really important to be great leader in healthcare? 

[00:25:11] Jay Ackerman I think three things come to mind. First, seek to understand a healthcare problem at the most granular level. So if you wanna build a company in healthcare, you gotta know what problem you wanna solve and you gotta understand that problem really, really deeply. And put yourself in a place where you can get really smart about it, okay? So that might sound simple, but that takes real work. The second, building a company in any industry is hard. Building one in healthcare is really, really hard. Find a partner that has equal passion and complement you. This is not for the faint of heart, and I think you’re better off with a partner to go through that with. So that would be my second piece of advice. My third would be, as you think about that problem that you believe you can solve, is really thinking hard, is this a problem that, like would be good to solve or must it be solved? Like the good to solve don’t turn into really big companies and big opportunities. Like the must solve ones create massive opportunity. And I think a lot of people miss out, like make the mistake on that third. Like, yeah, like it’s a nice problem. Like it’d be good to solve it. Like it’s really hard to build something at scale in those places where people are somewhat okay with the status quo. 

[00:26:45] Jon Lange And the first point you made, I think, is really interesting. And you have a really unique perspective in thinking through this. Some of the differences between being a leader at a healthcare company versus a company in a different sector. Based on your experience leading companies in healthcare and outside of healthcare, what are some of the unique challenges that you faced leading a health company? 

[00:27:12] Jay Ackerman Yeah, so, you know, there’s a couple of things that I think are unique to healthcare. One, it is a massive, massive market. When you look at trillions of dollars being spent in healthcare. So we decided to tackle a problem in the payer landscape and the provider. Trillions of dollars are spent. So I could pull up a chart and say, tell you how big my TAM is, and it’s impressive. But when you talk about like unique number of entities that you sell to, it’s pretty finite. And so in healthcare, if you want to build a big company and a company of scale, like you have to go really deep with a handful of players. And so there’s just an interesting conundrum in healthcare. Can’t build a company without being really big with a number of players, and so that’s just different. And then like a horizontal B2B SaaS company. That’s number one. Number two is the compliance angle. Because compliance is super important, businesses and business transactions move at a different pace. It’s harder for new entrants to break out. Time to kind of impact is longer, and so you need patience. I didn’t understand that as well as probably I would have liked to the day I stepped in as CEO of this company. And I think it’s one of the points that I talk. Comes up a lot when I’m talking to an early stage founder who’s launching a business in healthcare. 

[00:28:57] Jon Lange I want to switch gears a little bit. And of course, you and I spend our professional lives in healthcare, but we are all consumers of the healthcare system. And we all have lives, you know, before this that led us to the jobs we do today. Are there any personal stories that drive you and inform how you run Reveleer? 

[00:29:19] Jay Ackerman I’ll use my mother and father. My dad is a, it was a, let’s call it two-time entrepreneur, and so how I like think about run the company, I think a lot about what my dad did, who was in college, educated, had an opportunity to create a business, did it, and built a really successful business that was purchased by private equity buyer, at a time where I had no idea what a private equity buyer was. And, you know, there were a couple of simple lessons for him around building a company which was never be afraid to hire people smarter than you. Super simple advice, it’s actually hard for people to do. Well, people are intimidated by that. And I had a CEO in a prior company that I think did an exceptional job on that. Was never afraid to hire somebody too big for a job. Really smart people will make the job bigger. They’ll make the company bigger. I have big ambitions for this company. Let’s not make those ambitions turn into ego and ego be about me, you know? But around healthcare, my mom’s a driver. My mom is no longer here. She’s your classic example of a Medicare Advantage member gone astray, sadly. She had lots of health issues most of my childhood life. She used the ER often like her primary care, which is terrible for everybody. And so, she’s the driver. To try to change the health system so that the plan and the provider work together, the plan and the provider work together to motivate that patient to take more appropriate action around their own care. And to ensure that the critical insights aren’t lost in a sea of information. And so she passed. We’re just about to hit our third, third anniversary of my mom’s death. But yeah, she motivates me around what we do, because I can see how overwhelming her information would be for a doc. 

[00:31:35] Jon Lange Yeah, it’s really interesting. And it’s easy when we’re running or investing in healthcare IT companies, data companies, AI companies, to forget that this has an impact on patients every single day, and how providers care for them, and how they can be empowered to get involved in their own healthcare as well. And so I find these personal stories so powerful in keeping that really top of mind in informing how we drive these businesses. And maybe finally, there’s so much opportunity ahead, there’s much promise for what value-based care can deliver. What excites you most about the road ahead for Reveleer? 

[00:32:19] Jay Ackerman I think what I’m most excited about is how we are now at the point of care. And when I entered the company that was called Health Data Vision in 2016, that was a tech-enabled service business working in a really tiny corner of the payer landscape, I never envisioned us being at the point of care, and so I am really excited that we’re at the point of care that a doctor and more and more doctors are going to be clicking on kind of the Reveleer alert as they deliver care to their patients. So I’m thrilled that we’re doing that. I find that to be super gratifying in our mission. And while we’re trying to lean in to be as complete and as accurate and as supportive to a provider’s success as possible. And I think we’re in the early innings of that. But the hybrid AI announcement from late last year, you know, is a big, big part of that. And we’re working to be more integrated into critical EMRs. Some play better than others. And we are excited to partner with those that are leaning in and battle those who are not. And, you know, I think we’ll find our way properly in the critical EMRs to be a key part of care delivery. 

[00:33:52] Jon Lange Jay, thanks so much for joining me. It’s always a pleasure. 

[00:33:54] Jay Ackerman Jon, it was a blast. I’m glad we finally did it. 

[00:33:59] Jon Lange As we wrap this episode, I’m joined by Ethan Chosnek, Vice President in the Healthcare Group at THL. Ethan, one thing Jay and I talked a lot about was value-based care and some of the challenges that have made adoption slower than expected over the past 10, 20, 30 years. As you think about value-based care from an investor perspective, can you just set the stage for us a bit? What are some of the challenges that you see and how do you see the outlook for adoption of value-based care going forward? 

[00:34:30] Ethan Chosnek So one fundamental problem with value-based care is data. Without real-time, accurate data, value-based care doesn’t work, because payers don’t know how to judge patient acuity and risk scores, and providers don’t know how to care for their patients. So what that creates is an environment where providers and payers are disconnected, and ultimately the patient is the one who suffers from that. As we think about where we’re going, data plays a key part in solving this puzzle. With good data, providers can provide better care, and patients can receive better outcomes. 

[00:35:01] Jon Lange Ethan, you spend a lot of your time evaluating companies like this and thinking through which will be the winners and which will be losers. And so, in an ecosystem like this that really is still taking shape and where there’s still so much innovation to be done, how do you think about evaluating the winners and losers and ultimately which approaches are going to succeed. 

[00:35:23] Ethan Chosnek Yeah, it’s a great question, Jon. So when I think of a space like this, I think of it almost in three components. There’s data, there’s AI, and then there’s the workflow. And ultimately I think the workflow will make companies the most successful. When I think about data, data will be commoditized. It’s what you can do with that data to deliver results to the payers, to the providers, and ultimately to the patients who need that data, that real-time data, so they can be better cared for. I think those are the folks that are going to win. 

[00:35:51] Jon Lange And Ethan, another thing Jay and I talked about at length is leadership and the role of a CEO. You’ve spent so much time with CEOs of a number of companies. From your perspective, what makes a great CEO in healthcare? 

[00:36:06] Ethan Chosnek Yeah. Jay had a really crisp framework for this. He summarized it in three key points, culture, team, and strategy. When I think about any successful organization, culture is obviously the backbone that really supports the values up and down the organization. Then you have the team, right? And he alluded to this building a strong executive team that can sustain the business on its own is absolutely critical. Folks that can coach and mentor individuals below them, and really advance the agenda forward. I think building that strong team is essential to a good business. In last strategy, and Jay highlighted this, I think it’s incredibly important for CEOs in order to be successful. They have to think about where the puck is going. They need to prioritize their end customers and what those customers’ needs are. They need take the time to reflect on things they can do better and processes they can improve. So building the right strategy so that they can advance the company forward and advance the entire organization is obviously critical. A great CEO carves out the time to do all three of these things. And without carving out the time to think about your culture, to think about your team and to think about the strategy, you know, it is tough to be in a CEO role and ultimately be successful. So what Jay said really resonates with me. 

[00:37:17] Jon Lange Another thing Jay and I spoke about is M&A, and his disciplined approach to evaluating M& A targets. Of course, M&A is part of our value creation plans at a number of our portfolio companies. So as an investor, how do you think about M&A, and how do you think about pursuing effective acquisitions that will really drive value at our portfolio companies. 

[00:37:40] Ethan Chosnek Yeah, it’s a great question, Jon. And obviously as you alluded to, one we think about frequently as M&A is a core part to our value creation plan at times. For me, my framework boils down to three key things. It’s strategy, it is economics, and it’s culture. Strategy, does the acquisition we’re looking at have industrial logic? When you put the products together, can you enhance the offering or the service you’re providing to your customer? Second, economics, doesn’t make financial sense. Is it accretive to the bottom line and to the overall organization from a financial perspective? And then third, culture. I think this one’s critical to get right, because this is what really holds the glue together. I think getting those three elements right, obviously creates a very successful environment for two companies to grow together, but without those three, you oftentimes find scenarios where companies don’t end up being as successful as you would have hoped. 

[00:38:34] Jon Lange And maybe finally, there’s been so much talk really over decades about value-based care and progress has been slower than a lot of people expected. Given your experience in this space, how do you see the future for value-based care? 

[00:38:49] Ethan Chosnek As I reflect over the last number of years, adoption has been slow, but I’m incredibly optimistic about the future. There was broad alignment in the system that patients want better outcomes and experiences in a more cost-effective way. And with technology, I am incredibly confident that with better data, with better insights and in better tools, we will be able to foster that environment to allow for better patient experiences and outcomes. As I look at the future, I have no doubt there will be challenges, but I’m incredibly optimistic about what the future holds for value-based care. 

[00:39:22] Jon Lange Ethan, thanks so much for joining me. It’s always a pleasure, and look forward to continuing the conversation with you and with Jay very soon. 

[00:39:30] Ethan Chosnek Thanks, Jon. 

[00:39:32] Josh Nelson Thank you for listening to Healthcare in Action, brought to you by THL. To help Healthcare in Action reach more listeners like you, either share this episode with a colleague, subscribe to the show, or rate or review us on Apple Podcasts. And for more background on THL’s Healthcare Vertical, you can visit us at thl.com/verticals/healthcare. 

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