Smaller pools

Building for the Medicaid population has never been a straightforward lap. Three years ago, the program was expanding: 92 million enrollees, $728B in annual spend, and a post-pandemic enrollment surge creating demand for care navigation, re-enrollment support, and community-based engagement tools. Then, one year ago this week, the One Big Beautiful Bill Act (OBBBA) became law. The mechanics of contraction are now in motion.

The companies that serve the Medicaid population are dipping their toes in different approaches. Cityblock Health, the urban Medicaid-focused primary care company, is in talks to acquire rural Medicare Advantage-focused startup Homeward Health—a consolidation play of two General Catalyst portfolio companies that could expand Cityblock’s reach into new geographies and populations. Earlier-stage players that are successfully securing capital are going after high-need specialties and social determinants, and leveraging AI to navigate the notoriously difficult infrastructure. Malama launched in March to scale their doula-led maternal care model, focusing on one of Medicaid’s costliest and most underfunded areas. Companies like port co Rosarium Health and Upside have both closed rounds this year to support housing stability and accessibility, with Medicaid-covered populations as a core focus. Others, like Conduit Health, are bringing agentic AI to complex, state-specific Medicaid and managed care rules.

Looking ahead, it’s possible that the Rural Health Transformation program’s $50B could offset some of what the OBBBA cuts take away. In the meantime, thirty states implementing work requirements have governors on the ballot in November, and the results may shape how much smaller the pools get.

Headlines

UpDoc's AI Gets FDA Nod To Act As ‘Concierge Doctor’ Between Visits
Startup receives FDA-clearance for patient-facing large language model The Wall Street Journal

FDA Gives Generative AI In Radiology Two Breakthrough Designation Nods
Aidoc and Cognita earn fast-track status for tools that draft chest X-ray reports STAT

Hims’ Obesity Drug Business May Get Boost As Employers Drop Coverage
Ten percent of large employers providing GLP-1 coverage plan to drop it by 2027 Reuters

WPS Acquires Women's Mental Health Platform Mavida Health
Health insurer makes its first digital care delivery acquisition Femtech Insider

The Wearable Data Your Doctor Actually Wants
Wearable consumer adoption is outpacing clinical integration The New York Times

Recent Funding

• Assort Health lands $120M to expand its voice agent platform for provider practices
• Remote monitoring and chronic disease management platform Cadence nabs $100M
• xCures bags $46M to streamline patient data and medical records
• Evaluation and compliance platform for autonomous voice agents, Coval inks $28M
• Hera closes $27M to coordinate post-visit care for Medicare-covered older adults
• Housing stability platform Upside raises $20M
• Ladder Health secures $7M for step-based behavioral health care navigation
• Xella Health seeds $4.7M for its precision care platform for women