Read time: 5 minutes

Good morning! It's Tuesday, October 10th. Today we are looking at CareBridge, a healthcare tech company that’s expected to generate $2.5B this year!

THE FEATURE

America’s Fastest-Growing Company is Revolutionizing Healthcare

CareBridge is the first healthcare company in a decade to secure the No.1 spot on the prestigious Inc. 5000 list of America’s fastest-growing companies.

The company has doubled its revenue over the past 12 months and seen nearly 5x growth in its patient base from 25,000 to 115,000– let’s figure out how they pulled it off!

What’s The Business?

CareBridge was founded by former US senator Bill Frist and government consultant and entrepreneur Brad Smith. The two tried to address systemic issues in the US healthcare system at the federal level but concluded that the government is too bogged down by bureaucracy and political in-fighting to solve the problems.

The two founded CareBridge as a healthcare tech company that services Medicaid insurance companies and long-term care (LTC) services to drive down costs and deliver better patient results. Essentially, the company equips caregivers with tech and data aggregation tools that allow them to better manage patients from the comfort of their homes.

At the core of CareBridge’s business is a two-way tablet given to caregivers that serves as a healthcare switchboard to record blood pressure and insulin levels or even contact medical professionals. With caregivers using the tablets to record critical information daily, patients have the best chance of receiving preventative care and insurance companies can avoid paying for costly hospital stays. It’s a win-win.

While CareBridge’s focus is narrow, they have a good reason for targeting LTC patients. Though they only represent 3% of Medicaid patients, they account for 17% of spending.

Unlike other startups that are created off of a single insight or innovation, Smith and Frist raised $40M to build CareBridge as an all-encompassing LTC healthcare solution via acquisitions. They purchased tech companies like Healthstar and Sinq Technologies to gain a suite of healthcare products and data aggregation tools.

In addition to gaining access to these businesses’ proprietary systems and products, Frist and Smith were also after their client lists. Each company they acquired had big insurance clients like Elevance and UnitedHealthcare, which allowed CareBridge to upsell its home healthcare services directly to them.

Gaining access to a killer client list doesn’t do much for a company that can’t deliver results, but that’s not the case for CareBridge. The initial data on how CareBridge can drive down costs was so compelling that America’s four largest managed Medicaid plans invested $140M in the company last year during a Series B funding round.

With just five clients, the top Medicaid providers in the country, CareBridge is set to generate $2.5B in revenue this year.

How They Win: Incentivized to Save

Managed Medicaid care organizations love partnering with CareBridge because it shoulders the risk for each of their LTC plan members (which average $40 to $50K in annual care costs).

These insurance companies pay a monthly subscription fee to CareBridge for every LTC patient they take on. In return for taking on the risk and standardized care, CareBridge takes 50% of any savings over the baseline costs of these patients.

In other words, CareBridge makes money when it drives down medical care costs and keeps patients healthy (which it does 90% of the time). Plus, their primary cost reducer comes from detecting health issues early on through data aggregation tools and addressing them before severe medical intervention is needed. So, they’re saving lives and money at the same time.

Key Observation

CareBridge’s massive growth shows the power of incremental innovations in any industry. By modernizing and optimizing Medicaid healthcare plans for LTC patients, CareBridge is already generating billions in revenue.

Get In Touch

1) Promote Yourself! Get in front of 7,000+ business professionals by sponsoring this newsletter (we ❤️ our sponsors). Just hit reply to this email and say, "Let's partner!"

2) Do You Have An Outlier Business? We want to share your story if you are building something cool and growing fast. Hit reply to this email and tell me - what you're building, why, and why it's an outlier business.

3) Ask Us Questions: Are you struggling with a business or career question? Just ask it, and we'll share it with thousands of people who want to help.