Vytalize Health, a risk-bearing provider enablement platform, ranked #1 on the 2024 Inc. 5000 list of the fastest-growing private companies in America. Co-founders, Faris Ghawi, MBA, CEO, and Amer Alnajar, MD, Chief Medical Officer, recently sat down with Healthcare Innovation to discuss their business model and remarkable growth rate.
Founded in 2014 and serving over 2,500 primary care physicians in 36 states, the company took the top spot with 2023 revenue of $1.5 billion and three-year revenue growth of 90,778 percent. The Hoboken, New Jersey-based company has raised more than $200 million from healthcare investors.
Healthcare Innovation: I understand that you met in college and have complementary skills and interests – Faris in engineering and business and Amer in medicine. So, in summary, you developed a model of care that was a perfect fit for the ACO movement when it was taking off, and you were able to scale it up dramatically. Is that true?
Ghawi: Amer developed this care model that focused on providing convenient, proactive care to patients and keeping them at home. Then we worked together to build a business model around it and make it scalable.
HCI: Were the things you originally developed in your practice changes in workflow or involving care coordinators, or was there a technical aspect to it as well?
Alnajar: It’s multi-faceted. It’s about technology and analytics, but there’s also a strong human component. When we started, we were building these house call practices in the New York/New Jersey area where we were visiting seniors in their homes. Before we got into the ACO world, we realized it was a lot about that proactive care and routine patient care. Honestly, I know it sounds very simple, but we found that when the PCP-patient relationship was there, when there was trust, a lot of wonderful things happened. What we’re trying to do at Vytalize is improve the relationship. We’re trying to take some of the technology elements, like making sure they have ADT feeds. We’re trying to take care of a lot of those things for our practices, with the goal of you spending more time with your patients.
HCI: Were there any initial challenges when you started diving into the ACO world, whether it was reporting or setting up the infrastructure?
Ghawi: Countless challenges. That’s where the friendship really helped. We lived together. We spent all day dealing with problems. And we made a lot of changes in direction. We probably made a change in direction six, seven times in every way. We changed the care model multiple times. We changed the go-to-market strategy multiple times. We changed the revenue model multiple times. We tinkered around. For example, in 2014, Uber was the big thing and it was very attractive to be a pure-play technology company, right? A lot of companies did that, but we felt that healthcare was different. Technology alone is not enough. You have to have all the pieces. You have to have the technology and the clinical piece. We wanted to be the provider, at least in the beginning, and build our own practices and learn from that. And that’s what gave us street cred later on. We knew we had the care model right. We also had to have the financial model. You have to have all the components. So there were a lot of temptations to take the easy route, but I don’t think that would have worked. We didn’t shy away from difficult things if we felt they were the right thing to do.
HCI: Is part of your sales pitch to practices that you are taking on risk for them as part of these value-based care agreements?
Alnajar: That’s true. When we first started recruiting physicians, many of them told us their horror stories about participating in value-based care programs, which were usually driven by the health system. They said, “I did all the work; they promised me so much money. I got nothing and ended up losing money.” Some of our competitors charge providers a monthly fee to participate.
But we see primary care physicians as the coaches or quarterbacks of the entire healthcare system, but they’re the lowest paid. They have the opportunity to create a lot of value in the system, but they need a way to do it. We help do that. We bring the ACO, we bring the skills, the expertise, the technology, the data, the physician partners. Physicians love working with physician-led companies, and that’s what Vytalize is. We take on all the downside risk. Vytalize really makes it very easy for physicians to join value-based care and provide that level of care to their patients.
HCI: What were the challenges you faced in terms of the company’s rapid growth? You now have hundreds of employees, right?
Ghawi: You have to try to balance growth with infrastructure, and it’s impossible to get it exactly right. You’ll spend too much in certain areas and not enough in others, and you’ll have to play catch-up, and that hurts a lot. We’ve made all kinds of mistakes, everywhere you can imagine, on things we didn’t even know were on the table.
Value-based healthcare is a huge opportunity. It basically combines the complexity of being an insurer with the complexity of being a provider, with the complexity of being a technology company, with the complexity of being a FinTech company, because a lot of it is also finance. Each of those things brings its own challenges and solutions. If you miss one of them, you’re done, right?
HCI: Do you think you have managed to maintain the same company culture as you started, even though the company has grown?
Ghawi: Absolutely, culture is a key aspect. The good news is that people create the culture. And the people who have joined Vytalize are believers in value-based healthcare – optimists who have seen how this system works best and are here to make it work optimally at scale. Either they’ve seen it at a payer, a technology company or another value-based healthcare company. You can improve health outcomes and reduce costs, but to really make a difference, you have to do it at scale.
HCI: Do you give CMS high marks for the way they conduct these programs like MSSP and ACO REACH?
Alnajar: I like the direction they’re going. I’m glad we’re finally paying for outcomes, not services. My only criticism is that I’m such a big fan of value-based care that I want it to be widespread in as many PCP practices as possible. CMS has said they want everyone to be in an ACO by 2030. But the way the quality metrics of these programs work is that if you grow quickly, you get hurt. If a lot of your practices don’t have a lot of ACO experience in the first year, you’re definitely going to be at a disadvantage from a shared savings perspective. I wish CMS would be friendlier to growing ACOs than stagnant ACOs, because I feel like we have to choose between profitability and growth. Ideally, we want to have both.
HCI: Would you like to mention any next steps for the company?
Ghawi: We want to continue to see positive results. Vytalize is starting to expand into more payer areas – Medicare Advantage, commercial and also Medicaid. We have a very large presence with physicians, so we want to make sure we’re helping them across their entire patient base so they’re not just focused on Medicare. We’re fully committed to executing that growth, processing it, making sure we’re putting those positive results into practice and consolidating and strengthening the foundation for future growth.
