Diogo Rau

We are now starting Q4 2025 and quarter after quarter, category-shaping events show that HealthTech is maturing.... Q3 2025 was no exception. I wrote down a few thoughts. 1️⃣ 𝐑𝐚𝐝𝐢𝐨𝐥𝐨𝐠𝐲 𝐀𝐈: 𝐭𝐡𝐞 𝐛𝐥𝐮𝐞𝐩𝐫𝐢𝐧𝐭 𝐟𝐨𝐫 𝐜𝐥𝐢𝐧𝐢𝐜𝐚𝐥 𝐀𝐈 About 80% of FDA-approved algorithms are in radiology, making it the most advanced (and most widely adopted) clinical AI category so far (even as medical chatbots like OpenEvidence are catching up). Yet, there’s no clear winner. Will success go to: ◾Aggregator platforms like Deep, which bundle multiple AI tools? ◾Specialists developing full-spectrum algorithms, like Gleamer? ◾Combined approaches doing both aggregator and algorithms like AIDOC? ◾Next-gen foundation models in radiology, such as Raidium? ◾Or incumbents (RIS and PACS vendors) using targeted M&A to stay on top? Icometrix chose the safer path, selling to GE. 2️⃣ 𝐀𝐠𝐞𝐧𝐭𝐢𝐜 𝐀𝐈: 𝐧𝐞𝐰 𝐰𝐨𝐫𝐥𝐝 𝐯𝐬. 𝐨𝐥𝐝 𝐰𝐨𝐫𝐥𝐝 This is where the fiercest battle is happening. Software entered healthcare 20+ years ago, with Epic landing its first big deal in 2003 with Kaiser Permanente. Now AI is eating software... and incumbents are fighting. New AI-native operating systems are emerging, combining scribing, billing, clinical decision support, and workflow (like Commure in the U.S.). Incumbents like Epic and Doximity are trying to suppress challengers, while Cerner has launched a brand-new agentic AI EHR built from scratch. The battle is on. 3️⃣ 𝐁𝐢𝐠 𝐓𝐞𝐜𝐡 𝐡𝐚𝐬𝐧’𝐭 𝐥𝐞𝐟𝐭 𝐭𝐡𝐞 𝐫𝐚𝐜𝐞 Despite setbacks, Big Tech is still pushing hard. OpenAI: With OpenEvidence’s traction and U.S. healthcare making up ~20% of GDP, OpenAI sees a big opportunity. Microsoft: The most active so far, with cloud, data tools, Nuance/Dragon, and now bold clinical claims. In June 2025, Microsoft said its AI outperformed doctors on complex cases, scoring 85.5% vs. ~20% for a panel of 21 physicians. Apple: Trying again with its new hypertension feature. Tim Cook once said Apple’s biggest contribution to humanity would be in health..... we’re still waiting. 4️⃣ 𝐎𝐧 𝐭𝐡𝐞 𝐝𝐚𝐫𝐤𝐞𝐫 𝐬𝐢𝐝𝐞, 𝐦𝐚𝐧𝐲 𝐕𝐂𝐬 𝐚𝐫𝐞 𝐬𝐭𝐢𝐥𝐥 𝐰𝐨𝐧𝐝𝐞𝐫𝐢𝐧𝐠 𝐡𝐨𝐰 𝐭𝐡𝐞𝐲’𝐥𝐥 𝐫𝐞𝐭𝐮𝐫𝐧 𝐭𝐡𝐞𝐢𝐫 𝐟𝐮𝐧𝐝𝐬. For SaaS point solutions in #healthcare, life is tough. They’re caught in the middle: squeezed between incumbents with outdated tech that won’t integrate their tools, and a new wave of agentic AI platforms that bundle multiple SaaS functions into a single agent. Still, some #SaaS products bring valuable technology. Expect more M&A in the months ahead. ----- Follow HGM Advisory for daily reposts of the most relevant HealthTech news #ai

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Abridge partners with Highmark on real-time prior authorization. Another example that AI Scribing is not about the note. The last few days brought rumors about Epic launching an AI scribe that will supposedly vaporize billions in investor money across the ambient AI space. But AI scribe valuations aren't high because they transcribe conversations. It's high because once you become trusted software in a physician workflow, you can go upstream and downstream into literally any other workflow. Abridge and Ambience Healthcare are doubling down on revenue cycle management (RCM) workflows, and this Highmark partnership is a perfect example. Their AI solution automates completing prior auth forms, submitting and reviewing requests, tracking status, and identifying when authorization is needed in the first place. Per my understanding, it works like a real-time checklist during patient encounters, outlining authorization criteria for specific procedures and letting clinicians push through approvals at the point of care. This is quite transformative because, as said in the article, prior auth is normally done POST encounter, while with Abridge it can be done "at the point of conversation". The AI scribe valuations won't go to zero. They'll consolidate around companies that find ways to go upstream or downstream where the money is made (or saved). But, important nuance (only the OGs will understand this reference), it requires deep EHR partnerships AND finding use cases EHRs don't want to build themselves. Prior auth is perfect: too messy and politically sensitive for Epic to own directly. Abridge figured this out early, went all-in on Epic partnership (literally opened a Wisconsin office to be closer to headquarters), and now they're reaping the benefits. Cool stuff! PS: I will say 95%+ of AI Scribes won't survive because EHRs won't build 130+ partnerships like this, so yes Epic will vaporize a lot of investor money but not all of it.

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Healthcare has a data problem. And AI is arriving at exactly the right time. Despite being one of the world’s largest data-generating industries, so much of that potential remains unrealized: Researchers devote years to advancing science, yet much of the data remains underutilized. Health system operators are under constant pressure to deliver better care at lower cost, but without accessible insights. Drug developers invest heavily into new therapies, but patient data and claims remain scattered. And the list goes on. I see AI as the catalyst: connecting silos, unlocking insights, and enabling real-time decisions, and more – all in service of better science, better care, and better therapies. Do I see AI replacing human effort in healthcare and research? No, the potential of AI isn’t about substitution. It’s about amplification. It’s about partnership. Do I see AI as a force for good? Yes, I believe AI can be one of the most transformative forces for good in medicine and science - not just by making systems more efficient, but by helping people live healthier lives. We have plenty of ground to cover, but the momentum is building. These are the questions I’ve wrestled with as a surgeon, professor, patient, and now founder at Medeloop. They remain at the heart of the work we’re doing.

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Innovaccer bought Story. We will see more headlines like this in 2026. The last year of healthtech M&A has not involved Enterprise Payors, Payviders, or Big Tech: It's late-stage VC-backed companies acquiring earlier-stage startups. And the trend will likely continue. It's the anti-ZIRP playbook: build distribution first, then tuck in specialized tech, data, or care pathways. 7 recent examples: • Innovaccer (Series F) <> Story → Extending patient engagement + care management to deepen data platform utility. (Story was Series B, Raised ~$42M) • Cohere (Series D) <> ZignaAI → AI-driven utilization management meets automation to speed prior auth. (ZignaAI was Seed-stage, Raised < $10M). • Lyra (Series E) <> Bend → Mental health leader adds precision coaching + chronic care support. (Bend was Series A, Raised ~$32M). • CapitalRx (Series D) <> Amino → Scaling beyond pharmacy benefits into member navigation + data insights. (Amino was Series C, Raised ~$45M). • Datavant/Ciox <> Aetion → Linking data connectivity with real-world evidence for life sciences. (Aetion was Series C, Raised ~$212M). • H1 (Series C+) <> Ribbon → Combining provider data graphs with API-first directory infrastructure. (Ribbon was Series B, Raised ~$54M). • Commure (Series F) <> Memora → Embedding intelligent patient workflows into the operating system for healthcare delivery. (Memora was Series B, Raised ~$80M). Q4 of '25 or '26 predictions: We'll see more of this as late-stage companies tell a story about getting to profitability, strategic acqui-hires, revenue/contract expansion, and AI-proof their businesses.

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Doximity just released a free AI scribe for US clinicians, accelerating commoditization/the race to the bottom. Their product won’t integrate into the EHR like Abridge, but it’ll be interesting to see how much it impacts their ability to acquire customers, drive usage and maintain retention. This is the start of a trend that will continue across every vertical market. Counterpositioning with free products to undercut upstarts and incumbents alike. Buckle up. Your margin is someone else’s opportunity.

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Here’s your recap of last week’s health IT news 🗞️ 👇 • In case you missed it, we here at Elion raised a $9.3M seed round.   https://lnkd.in/eWa5JEdZ   🤖 𝗔𝗜 𝗖𝗹𝗶𝗻𝗶𝗰𝗶𝗮𝗻 𝗔𝘀𝘀𝗶𝘀𝘁𝗮𝗻𝘁 • Epic plans to announce its own ambient scribe tool later this month, according to multiple reports.    • Creyos expanded its Session Notes feature to support structured assessment protocols.    • Doximity acquired Pathway Medical in a transaction valued at $63M. 🩻 𝗔𝗜 𝗜𝗺𝗮𝗴𝗶𝗻𝗴 • iRhythm Technologies, Inc. is partnering with Lucem Health to flag elevated arrhythmia risk using clinical data and route identified patients to Zio monitoring—positioned for population health and value-based care programs. 🌡️ 𝗔𝗜 𝗥𝗲𝗺𝗼𝘁𝗲 𝗣𝗮𝘁𝗶𝗲𝗻𝘁 𝗠𝗼𝗻𝗶𝘁𝗼𝗿𝗶𝗻𝗴 𝗮𝗻𝗱 𝗧𝗿𝗶𝗮𝗴𝗲 • Amwell received a contract extension from the Defense Health Agency to continue powering virtual care for the Military Health System, integrated with MHS GENESIS.    • OU Health partnered with Nexus Bedside to launch a hybrid nursing model that pairs virtual nurses with bedside teams; initial rollout is in neurology/neurosurgery with plans to expand. 💼 𝗣𝗿𝗼𝘃𝗶𝗱𝗲𝗿 𝗮𝗻𝗱 𝗣𝗿𝗮𝗰𝘁𝗶𝗰𝗲 𝗔𝗱𝗺𝗶𝗻𝗶𝘀𝘁𝗿𝗮𝘁𝗶𝗼𝗻 • Press Ganey launched an integration with UKG that integrates data across the two to automate submissions and inform staffing decisions.    • Capsa Healthcare acquired BlueBin Inc. to “enhance visibility, efficiency, and reliability across the entire clinical supply chain.” 💸 𝗥𝗲𝘃𝗲𝗻𝘂𝗲 𝗖𝘆𝗰𝗹𝗲 𝗠𝗮𝗻𝗮𝗴𝗲𝗺𝗲𝗻𝘁 • Rectangle Health and ECHO Health formed a partnership focused on streamlining payer-to-provider payments for healthcare organizations. 📈 𝗗𝗮𝘁𝗮 & 𝗔𝗻𝗮𝗹𝘆𝘁𝗶𝗰𝘀 • Rhapsody announced general availability of its Envoy platform for health systems, labs, and payers.    • Duke Health is partnering with Trilliant Health to “inform enterprise strategies in growth planning, network design and patient access.”    • Datavant completed its acquisition of Ontellus. ⚙️ 𝗖𝗹𝗶𝗻𝗶𝗰𝗮𝗹 𝗢𝗽𝗲𝗿𝗮𝘁𝗶𝗼𝗻𝘀 • Xsolis launched Dragonfly Navigate, an AI-powered workflow tool for discharge planning and capacity management.    • Zyter|TruCare unveiled Zyter Symphony, an agentic orchestration layer to automate enterprise workflows.    • CLEAR is “under construction” in Epic's Toolbox to streamline provider access.    • Cognizant debuted the TriZetto AI Gateway to embed governed generative-AI capabilities across the TriZetto portfolio (claims, care management, customer service).    • Elation Health announced a major AI expansion, adding native AI features (e.g., Note Assist, Actions, Clinical Insights) across its EHR and billing platform.

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I recently joined Matthew Miller and Katie Greifeld on Bloomberg to continue our discussion on required infrastructure to support AI as well as the implications on the American workforce as AI adoption continues. Here are a few important takeaways regarding AI's impact on jobs moving forward: 1. We are on the cusp of a start-up explosion. Never before have tools been at the fingertips of founders to research ideas, construct and host MVPs, develop outward facing sales and marketing materials and motions, and engage customers ... with minimal cost or incremental people. 2. Young people are worried about their professional futures. Most of the conversation has been about how AI will minimize or eliminate entry level and apprentice-based jobs, HOWEVER.... 3. The jobs most at risk are the senior level jobs. AI co-pilots can convert a talented, mid-level person into a near surrogate for a highly seasoned professional because AI can ingest nearly every fact and experience on a profession and deploy that knowledge accurately in the moment. This is the major turning point from a productivity and cost improvement standpoint. For instance, an elite surgeon will amass 40,000 - 50,000 operating room hours across her or his career. Healthcare Ambient AI leader, Artisight, has ingested over 2.5 million hours of surgeries. It provides best practices to surgical clinicians today. Whether improving surgical times and room efficiency for improved productivity or coaching clinicians for better outcomes, Artisight is incredibly well positioned to improve outcomes and margins in hospitals. This same model (AI led expertise) can be deployed in nearly every industry. https://lnkd.in/gbVHyrss

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The real opportunity in health tech isn’t another AI triage app or predictive tool. It’s addressing the 30 days after hospital discharge. Most venture-backed startups are going after the flashy areas: virtual primary care, AI radiology, and wearables. But any ER doc can tell you the avoidable spend is hiding in a boring place: what happens after a patient leaves the hospital. Where things break down: Discharge summaries don’t reach the next provider on time. Nursing facilities and home health agencies often still rely on fax or phone calls. Medication lists don’t match. The drugs prescribed at discharge often differ from what the pharmacy can supply, leading to dangerous gaps. Equipment and follow-up visits are delayed. Wound vacs, oxygen, or even the first nurse visit may not show up until days later. Breakthrough pain isn't addressed quickly, leading to unnecessary ER visits. No one “owns” the first 72 hours. Everyone assumes someone else is checking in, so problems get missed until the patient is back in the ER. If I were building, the minimum product would: Capture the discharge event in real time. Pull a simple feed from the hospital to know when a patient is going home. Run a quick risk screen. Flag high-risk patients (heart failure, COPD, sepsis, complex wounds) for extra attention. Trigger a short checklist: confirm meds are filled, equipment is delivered, and a nurse visit is scheduled within 48 hours. Send tasks directly into the systems that post-acute providers already use. No new portals, no duplicate data entry. Measure what happens. Did the first visit actually occur? Was the med list reconciled? Did the patient end up back in the ER within 7 or 30 days? How to prove it works (a 90-day pilot): Focus on two or three conditions with high readmission rates (e.g., heart failure, COPD). Track simple metrics: % of patients reached within 48 hours of discharge % with meds reconciled in 24 hours Readmissions within 7/14/30 days Cost savings for the payer vs. the historical baseline Why this is investable: Hospitals and payers already lose money on readmissions and preventable ED visits. Medicare and commercial plans reimburse for many of the activities (post-discharge check-ins, remote monitoring). A 10–20% reduction in readmissions in a targeted population is a meaningful ROI within months. What kills startups in this space: Relying on manual nurse calls without a real-time discharge feed (too slow). Creating portal instead of embedding into existing workflows. Selling only to hospitals (not scalable), without involving payers who control the economics. The durable wins will come from companies that can tie together hospitals, nursing facilities, home health, and pharmacies into one simple loop. Not flashy. But that’s why it’s wide open. #PhyCapPhyCap Fund #postacutecare #venture

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In massive, fragmented markets like healthcare AI where it’s rarely winner-take-all, being a late entrant can actually be an advantage. 1/ Early entrants expend time and capital meandering through countless GTM experiments. 2/ Falling input costs (vendors, inference) lowers the cost to launch and get a sellable product to market. 3/ Each marginal dollar later in the cycle works harder than the tens of millions spent educating customers. But late-entry advantage only materializes if founders are deeply informed about their own market. The bar is higher from investors: a clear, differentiated raison d’être; elite execution velocity; and an intense, underdog sense of urgency.

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Rumour has it Epic will announce its own AI scribe this month. Why would Epic do this and what does this mean for Ambient vendors? My answers to the top 5 questions folks are asking: 1️⃣ Why would Epic build its own AI scribe after all these partnerships with Abridge and Nuance? The surprising thing isn't that Epic built its own AI scribe. It’s notorious for building in-house. The surprising thing happened back in summer 2023 when they announced their Abridge and Nuance partnerships INSTEAD of building in-house. So what changed? I suspect that after the ChatGPT moment in 2022, Epic realized it would need to move quickly into Gen AI. Building out ambient would take longer compared to other Gen AI use cases (e.g. AI draft in-basket responses) and Epic didn’t know ambient would take off so quickly. So it made sense to partner with a couple of ambient tech companies and not spend major R&D resources yet. Remember: Epic had 100 other more obvious AI use cases to bet on. But AI scribes exploding as the killer use case took Epic by surprise and they probably decided in 2024 to take building ambient in-house seriously. 2️⃣ Is this because Epic fears the ambient companies will disrupt the EHR? Outpatient EHRs should be worried, but I don’t think Epic is. More likely, Epic believes the increasing integration requests from health systems to support ambient vendors makes their life harder, so they’re better off just building the scribe piece in-house. Plus, the downstream workflow expectations from customers (e.g. turning notes into automatic orders) is overlapping more with what Epic believes should be core EHR territory. 3️⃣ Will the price of AI scribes go to $0? No, as I doubt even Epic would charge $0. Epic’s AI scribe will probably be part of their AI bundled license which is not free. Now maybe it’ll be “cheaper” if you carved out the value of the scribe, but for the whole AI bundle, it may actually be even more expensive over time as Epic increases prices to account for bundling in the downstream AI features (e.g. AI coding, automatic order entry etc). 4️⃣ Will ambient vendors go out of business? Ambient vendors, as best-of-breed, will always have better customizations and configurations for clinical specialties (e.g. surgery vs primary care), clinician type (e.g. nursing vs medicine), languages, etc. The question is not whether the third parties are better products than Epics… the question is whether their product will be 10x better on dimensions that ACTUALLY change purchasing decisions. I suspect the 10x dimensions will be: → How good the AI medical coding features are at improving revenue capture → How good the downstream AI workflows beyond documentation are (will third parties have such limited integrations beyond the scribe piece that Epic’s native product will be the only realistic option for e.g. automated orders?) 5️⃣ What will happen to the $1B+ valuations for ambient companies? Continued in comments 👇

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“Deploying Safe & Scalable AI in Healthcare.” Last night I had the chance to attend this Pear VC event-- thanks Andrew Parambath, MD, MBA for the invite! The conversation was refreshingly candid about what’s working and what isn’t as we move from demos to durable impact. My takeaways: Adoption is outpacing literacy. LLMs are already inside health systems, but most clinicians haven’t been trained on when (and when not) to trust them. AI fluency needs to become a core clinical competency—no different from reading an EKG. Benchmarks are not the bedside. Dr. Roxana Daneshjou taught us that static tests tell us little about safety, time, and downstream utilization. The standard should be real‑world trials with humans‑in��the‑loop and measurement of unintended effects (e.g., longer visits, second visits, or message overload). Loved the granular insights on the Penda Health x OpenAI study from Dr. Graham Walker, MD Incentives > algorithms. In fee‑for‑service, asynchronous/agentic tools that make care more efficient can paradoxically reduce revenue. If we want autonomous medication titration, outreach, and care navigation to scale, pay for outputs/outcomes, not minutes. The elephant in the room of course...EHR gravity is real, so health tech needs to choose your lane. Enterprise bundling will continue, but there’s massive room for best‑in‑class workflow solutions and SMB products where clinicians are the buyer. Bottom‑up products that give time back as Freed CEO Erez Druk pointed out could keep winning. I worry about this particular point though because trends show consolidation and shrinking of this segment, not expansion. Erez also won me over on his company's approach treating the clinician as "the heart of healthcare", and it's clear they have some exciting things on the roadmap for a land and expand strategy that will bring value to patients and clinicians alike. Clinician remains the captain and augmented>artificial for now. The near-term model is “agentic auxiliaries”—AI that drafts, checks, orders, and coordinates under licensed oversight with auditability and recovery when things go wrong is a very exciting model that Updoc CEO Dr. Sharif Vakili highlighted. How this maps to MSK & population health at RevelAi Health? High‑touch, AI‑enabled asynchronous care coordination that closes gaps without adding clicks. Outcome‑oriented ROI: reduced readmissions/ED revisits, faster PCP follow‑up, Quality reporting completion, and closed‑loop social needs—reported by patient risk segment to target intervention. Clinician‑in‑the‑loop agents with clear guardrails, escalation triggers, and real‑world evaluation. Thanks to Vivien Ho, organizers at Pear VC and the panelists! Excited to keep building—with safety, incentives, and impact aligned. Full write up on Techy Surgeon now! https://lnkd.in/eN6Uz8By #HealthcareAI #AgenticAI #ValueBasedCare #PopulationHealth #EHR #ClinicalInformatics #RealWorldEvidence #CareCoordination

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Over 900 AI-enabled medical devices have FDA approval…..yet only a small fraction are actively billed through CPT codes. That disconnect highlights a key challenge: without clear reimbursement pathways and seamless clinic workflows, even the most promising innovations struggle to reach patients. From a CFO lens, this means advanced tools often sit on the shelf rather than driving value in preventive care. This gap matters because preventive cancer screening saves lives—by catching cancer earlier, outcomes improve dramatically, and the total cost of care across the health system declines. The promise of AI lies in scaling these benefits equitably and sustainably. On September 25, 2025, I’ll be joining an educational session on how reimbursement strategies and clinic operations can be reimagined to accelerate AI adoption—especially in cancer screening and preventive health. Please join us: NALHE Central Texas Oatmeal Health Jonathan Govette Jose Ferrua, FACHE, MBA, BSIE Lauren Jahnke Amanda Brummitt, FACHE 💻 Free and virtual — register here: https://lnkd.in/g369jQe4 #HealthcareInnovation #AIAdoption #CancerScreening #HealthEquity

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An alarming statistic - 85% of health plans still lack centralized data systems. Yes - it’s almost 2026 and we are still talking about this! And it’s not just a tech issue that remains a huge challenge- it is a missed opportunity for meaningful transformation in healthcare. According to a new report, most health plans are operating with fragmented data systems. Only a third rate data integration capabilities as excellent. This prevents them from fully leveraging AI and data-driven strategies to improve patient outcomes, reduce costs, and support physicians. But there is a path forward. Leading plans are showing that centralizing data isn’t just possible—it’s powerful. They’re already seeing results: better outcomes, stronger clinical relationships, and more efficiency as it relates to cost management. At the American Medical Association we believe that data and AI must serve patients and clinicians—not just systems. The future of healthcare depends on it. #HealthTech #AIinHealthcare #DataStrategy #ValueBasedCare #HealthPlans #AMA https://lnkd.in/eAzbuhee

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How We Build a Leading Digital Health Company by Focusing on a Single Clinical Specialty Through our full focus on urology Kranus Health has become a leading force in digital therapeutics. Our journey demonstrates that deep specialization in one clinical vertical can drive strong impact and credibility. Here's how we've built our success through vertical specialization: 👉 Portfolio Depth: Rather than spreading thin across multiple specialties, we've developed a comprehensive portfolio of therapies covering the top indications for urological care. Each of our therapies addresses critical needs & care gaps within our specialty. This focused approach has enabled us to achieve 72% brand awareness among urologists in Germany in under three years. 👉 Building Deep Provider Relationships: Our specialized focus allows our field force to engage with urologists as true partners in care delivery. We've built a sales team comparable to established pharmaceutical companies, with representatives who speak the language of urology and understand our specialty's unique challenges. 👉 Clinical Excellence: By concentrating on urology, we've established deep clinical credibility. Our research has been published in prestigious journals like NEJM Evidence, and we've conducted multiple gold standard randomised controlled trials - with more to come soon. This depth of evidence would be difficult to achieve if we were pursuing multiple specialties simultaneously. The results speak for themselves: - Multiple reimbursed digital therapeutics in our specialty - Strategic partnerships with leading pharmaceutical companies like Gedeon Richter - Strong provider adoption and trust - Published clinical evidence in top-tier medical journals Our experience shows that focusing on one clinical vertical creates the expertise, relationships, and evidence base needed for lasting impact. Stay connected as we continue advancing urological care through digital innovation!

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