January 6, 2023

Reema Health: Revolutionizing Medicaid Expenses with Digital Health

Maya Arengo
Medicaid Expenses and Digital Health

Medicaid and Medicare collectively constitute the largest expenditure for the U.S. government, surpassing even Social Security, at a staggering cost of over $1 trillion annually. However, this financial burden is far from evenly distributed. Merely 5% of total enrollees, classified as the highest-cost individuals, consume more than 50% of the Medicaid budget. Moreover, an alarming $100 billion is spent on preventable hospital visits. As government spending on Medicaid and Medicare is projected to reach unprecedented levels, the challenge lies in reducing costs while simultaneously enhancing the quality of healthcare services.

Recognizing this critical issue, Reema Health has emerged as a pioneer in cost reduction within Medicaid, leveraging digital health technologies to improve patient well-being.

About Reema Health

Reema Health's innovative approach involves deploying community-based Guides who provide healthcare services to fellow community members in need. Empowered with artificial intelligence (AI), these Guides identify the highest-risk individuals and deliver personalized text messages to effectively engage them. Reema Health offers an extensive range of services, encompassing housing assistance, employment support, and specialized healthcare from qualified physicians.

The brainchild of Justin Ley, a former healthcare professional who witnessed the unmet needs of vulnerable patients, Reema Health aims to bridge this gap and foster a culture of mutual support within communities. Inspired by his own childhood experiences of receiving community assistance, Ley has pioneered ways for individuals to provide invaluable support to one another.

Reema Health's community-driven approach has already yielded remarkable results. An astounding 90% of individuals reached by the program have actively participated in health programs or established connections with mental health professionals. This success has translated into a noteworthy 29% decrease in inpatient hospital visits, while patients have demonstrated 2.8 times higher medication adherence rates. Consequently, Reema Health exhibits the potential to significantly enhance the well-being of community members and alleviate the financial burden on Medicaid.

TSVC Conviction

Although Reema Health is further along in its development than our typical investment targets, we firmly believe in its capacity to improve patient health outcomes and curtail Medicaid costs. While the precise extent of Reema's cost-saving impact on Medicaid remains uncertain, the program's current levels of engagement and retention inspire confidence in its ability to substantially reduce expenses for many patients.

One concern raised at TSVC pertained to the scalability of hiring social workers. However, Reema Health's organizational structure ensures a linear correlation between the number of patients served and the recruitment of social workers. Consequently, their required capital aligns with revenue growth. Should they succeed in recruiting a large number of social workers, this will serve as a significant barrier to entry for competitors seeking to implement similar solutions.

Armed with a formidable team, a burgeoning market, and a truly unique approach, TSVC envisions immense potential in Reema Health's future.

By harnessing the power of digital health and fostering community-driven care, Reema Health stands poised to revolutionize Medicaid expenses while ushering in a new era of patient-centric healthcare.

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