Former CMS administrator Andy Slavitt starts venture capital firm

Former Center for Medicare and Medicaid Services Acting Administrator Andy Slavitt is launching a new venture capital firm called Town Hall Ventures.

Starting the firm with fellow health business veterans Trevor Price and David Whelan, the group said they are looking to invest in healthcare technology and services companies that impact care delivery for vulnerable populations that don’t always benefit from innovation.

In particular, the group said, they want to target care improvements for Medicare and Medicaid patients—a population that represents more than 120 million people and $1.2 trillion worth of health care spending, they said.

“There’s a significant underinvestment on the part of innovation for the care of certain populations,” Slavitt told FierceHealthcare. “We think we’re at the beginning of a wave of great companies being built that really focus on serving these patients.”

Slavitt declined to discuss certain financial details such as how large a fund the firm intended to build. He said they plan to be an opportunity-driven fund that will back deals anywhere from the earliest stages of business development through late stage.

Already, the firm has four companies in its portfolio, including joining an $11 million fund raise for kidney-care company Somatus Inc. Somatus was started by a DaVita alum in Virginia and New York-based Cityblock Health Inc., created in partnership with Alphabet Inc.’s Sidewalk Labs to provide primary care, behavioral health and social needs in urban populations.

Town Hall also made investments in Menlo Park, California-based Welbe Health LLC, a provider of integrated services to frail seniors who qualify for CMS’ PACE programs, and New York-based Aetion Inc., a company offering real-world analytics to drug companies and payors. Each investment has been between $1 million and $5 million.

Slavitt said the team believes the time is right to target the gap in innovation because CMS payment incentives have changed.

Slavitt served as CMS acting administrator from March 2015 to January 2017 under the Obama administration and was former group executive vice president at UnitedHealth Group that led a troubleshooting team for Healthcare.gov. He’s gone on to form health policy nonprofit United States of Care and is an avid health policy opiner on social media.

Price, who is the founder of executive search and investment firm Oxeon Holdings. Whelan is managing general partner Oxeon’s investment arm Oxeon Ventures and former general partner of Accretive LLC.

They named the firm Town Hall because it addresses the local nature of health care issue and the idea that town halls are most often the meeting place in a community where the private and public sector meet to solve problems, Slavitt said.

Price said Town Hall is trying to position itself at the epicenter of trying to do well by doing good.

“We really are looking to drive generational change with these companies. Every day the aging population is growing. Every day, there are growing gaps in health equity and in the quality and access to care,” Price said. “We would love to hear from entrepreneurs who want to play a role in changing that dynamic and building long-term, value-creating, sustainable businesses that also fulfill the mission.”

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