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Innov8 for Health breeds success by forcing failure




This story orignally ran in Soapbox's sister publication, hiVelocity.

Sunnie Southern knows firsthand how access to health care resources can impact a community. The Cincinnatian grew up in rural West Virginia, in an area where doctors are often scarce, local residents don't have easy access to health care information and specialists might be a half day’s drive away.

She has been interested in health care ever since she was a girl who watched her mom try to alleviate her grandmother's arthritis by using nutritional remedies. After graduating from West Virginia University and moving to Cincinnati for her first job, she embarked on a 15-year career in nutrition and also worked for a small pharmaceutical company.

In 2010, Southern founded Viable Synergy, a consulting and product development company whose mission is to empower people to improve their health using technology-based and in-person solutions. In September 2011, Viable Synergy launched Innov8forHealth, a business accelerator for health IT startups.

“We want to give people access to the tools and resources they need to make good health care decisions, while also helping to empower health care providers,” says Southern. “We believe that technology can democratize access to information.”

Innov8forHealth, a community-based effort that engages an array of health care stakeholders to identify ways that technology can improve care and create jobs, recently graduated seven startups from its 11-week accelerator program. It offered startups technical assistance, mentoring and $20,000 in support. Innov8forHealth was funded by the ONE Fund of Ohio Third Frontier.

The new companies range from a virtual pillbox that helps elderly patients manage their medications to an online game that helps kids with diabetes remain healthy. Southern says that these companies could become economic drivers for Cincinnati, which is already seen as being a national player in health IT.

Cincinnati was recently selected to participate in The Comprehensive Primary Care Initiative, a program of the Center for Medicare and Medicaid Innovation. The White House Chief Technology Officer also said during a 2012 TEDx talk that he was a "Fanboy" of Cincinnati's health care transformation story.

“We want to improve health, attract and retain top talent, and create jobs,” Southern says. "We believe this can create an economic advantage for our community."

The Best Ideas

To drill down to the top ideas within the community, Innov8forHealth uses a broad-based process accessible to anyone. Last fall, the group kicked off their initiative with an Ideation Challenge around the concept of "Transitions in Care." As the group winnowed ideas down to finalists, the prize money increased.

"It's like an idea funnel," says Southern. "By the time we reached our startup showcase day, we'd vetted the best ideas. The final phase was the accelerator."

Seven companies with market-ready health IT concepts were chosen for the program. Innov8forHealth received a six percent ownership stake in return for lending support. If the companies are successful, profits go back into the program.

A major focus of the accelerator was providing startups with customer feedback early on in the process. "To some people's chagrin, we had them get out and talk to customers," Southern says. "Some people will tell you, 'No, it's a bad idea,' and that may simply mean you have to design it differently. Why spend $20,000 in taxpayer money on something that has no value? We force failure."

Since it launched a year ago, Innov8forHealth has involved 450-plus community members, vetted more than 200 ideas and raised more than $600,000 in investment and in-kind donations. It has also secured 1,000 hours of community mentoring.

The seven accelerator graduates are CCM Link, Minerva Health Learning Systems, IFG Health, Satec Solutions, MedaCheck, Betterappointment and Empowering Innovations, LLC. Four have already received follow-on funding.

Bridging the Gap

The startups that graduated from the Innov8forHealth accelerator are geared toward helping patients better manage their own health, what Southern calls "bridging the gap between patients and doctors using information technology."

One example is My Fear Zapper, a product being developed by Empowering Innovations. The web-based game allows children to visualize their fears by creating a funny monster on the computer screen and then zapping it away.

"Stress costs the United States $300 billion annually," co-founder Andrea Brady said at a recent Innov8forHealth event. "People hold themselves back due to fear and don't achieve their dreams. This is about empowering people to reach their potential."

Brady is targeting psychologists, who could use the product to counsel children.

Another example is eProvizion, a product being created to automate the time-consuming task of managing employee access to private health records. Satec, the owner, is targeting hospitals with less than 10,000 employees.

Anthony Breen is the 20-year-old entrepreneur behind Minerva Health Learning Systems, which has created My Healthy Tale, an educational app for kids with diabetes. Breen wants to help these children manage their diabetes while at school or sleepovers so that they can enjoy stress-free, healthy childhoods.

"I reached out to endocrinologists and families and worked with the Juvenile Diabetes Research Foundation," Breen told the Innov8forHealth audience. "This is just the tip of the iceberg. There are so many challenges that these kids face."

Into the Marketplace

The health IT startups that have emerged from Innov8forHealth's accelerator are early-stage efforts whose commercial viability hasn't yet been established. Odds are that several of them—or even the majority—will fail to gain traction.

Scott Collins, CEO of the investment firm Linkage, told the audience at the event that's because entrepreneurs often don't spend enough time conducting the kind of consumer research that will help them to identify the viability of their product.

"It sounds great to the entrepreneur, but it doesn't have broad-based acceptance," he told the audience. "The question is, who will pay for it? With health care, you can't bank on insurance or the government. You have to look at the consumer. What is the return on investment going to be for them?"

The purpose of the accelerator model, of course, is to help companies match their product with a viable business model early on. To that end, Innov8forHealth even offers opportunities for nascent companies to pitch their ideas to angel investors.

Simon believes that Innov8forHealth's companies will be successful because of the rigorous vetting process and their alignment with today's problems in health care.

"We have guided many of the companies to focus on a business-to-business model that also includes a patient/consumer strategy—thus a business-to-business-to-consumer model," says Simon. "These companies sell to health care providers and systems and provide their customers with tools to engage and on-board patients."

One of the reasons why Innov8forHealth focused on health IT companies is because many do not require FDA clearance and can be scaled up fairly quickly. "The companies are literally making progress every week in launching their products to a broader audience, on-boarding new customers, starting new pilots and launching new features. It's a unique and exciting space in health care."

While these companies are for-profit and need to earn revenue, they are also aligned with transformational changes taking place in the health care system.

Innov8forHealth recently launched its 2013 Challenge, which aims to stimulate ideas "to support individuals and organizations to achieve the Triple Aim of Better Health, Better Care and Lower Costs." Submissions are due by Jan. 21.

"In today's patient-centered environment, doctors recognize they can't do it all on their own," said Pam Shannon, vice president of Population Health Management at Tri-Health. "They're thinking about how to motivate people to take care of their own health."

"Most health care providers think this is one of the most opportunistic times in the last 60 years, since Medicare was first created," added Paul Hiltz, president of Mercy Health Select. "They're excited about some of these opportunities."

Southern, too, hopes that Innov8forHealth's startup companies are not only financially successful but also help to improve care in their communities. "The industry is changing from episodic care to value-based care and outcomes," she says. "This is about maximizing the relationship between patient and provider."

By Lee Chilcote

Lee Chilcote is the managing editor of hiVelocity and editor, Development News and For Good, Fresh Water Cleveland. Subscribe to hiVelocity for more Ohio innovation news.



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