On April 16, 2106, it was announced that GA (Google Ventures) based in Mountain View, CA had invested $40M in Quartet Health, a digital health startup that focuses on mental health and substance abuse disorders, part of a new startup sector called “Behavioral Health.” Behavioral Health is growing and more E-health startups are trying to solve this problem by getting U.S. employers to offer these services as part of their benefits to employees.
$17M of new funding
Quartet Health belongs to this new sector called “Behavioral Health.” Behavioral Health includes mental health and substance abuse digital health services. Quartet Health shares the Behavioral Health category with two startups, Lantern and Lyra Health. In February 2016, Lantern had secured $17M of new funding. The round was led by University of Pittsburgh Medical Center (UPMC.com). Other startups in the Behavioral Health sector to watch include Sleepio, Empower, InteraXon, Peak, Big Health, Ginger.io, and Akili.
Quartet’s CEO, Arun Gupta has said, “You can’t think about health without thinking about mental health. There’s a role that behavioral health plays in the overall health of our nation and our community.” Lyra Health’s investor, Dr. Bob Kocher, a partner at venture capital firm Venrock who worked closely with the Obama administration on the ACA, also spoke to this concern when announcing their investment in Lyra, “Anxiety and depression are the number one cause of absenteeism in the workplace today.”
A relatively new topic
In USA, mental health is a relatively new topic as in 2008 Patrick Kennedy (Quartet Health’s Board of Directors member, he had served in the U.S. House of Representatives) sponsored the Mental Health Parity Act, which required health insurance companies to cover mental health conditions in a similar way to physical illnesses.
But these new Behavioral Health startups raise privacy questions. Are employers who offer these services to employees being benevolent or invasive? Do they cross the privacy line?
Traditionally, in the United States, healthcare insurance was offered and paid for in part or whole by employers. Until the Affordable Care Act (ACA), if you lost your job, you lost your healthcare coverage. And that meant if the main breadwinner lost his or her job, the whole family lost their healthcare coverage. Many Americans would say that not much has changed, since the costs for paying out-of-pocket fees for healthcare even with the ACA is very high, so getting health insurance through your job is a valuable benefit.
Mental healthcare may be the new premium benefit that makes a job offer
In Silicon Valley and throughout the U.S., there is a shortage of technical and engineering talent; therefore many companies offer excellent benefits and top-notch healthcare to lure employees to join their company, along with great salaries. Mental healthcare may be the new premium benefit that makes a job offer look better to a prospective employee.