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Thomas Dworetzky, Contributing Reporter | March 01, 2018
Verily, formerly Google Life Sciences, appears to be making moves in the health insurance space, unnamed sources tell CNBC.
In this latest Verily development, according to CNBC's three anonymous contacts, the company has been speaking with insurers about joint bids for contracts covering “hundreds of thousands” of patients.
This isn't a cold start into the insurance space for the company. According to one source, it had considered getting into Medicaid coverage in Rhode Island with Alphabet-backed insurer Oscar Health, but did not go forward on the project. Hinting at this potentially rich target market: Alphabet's Sidewalk Labs incubated a start-up called Cityblock that aims to boost care for low-income patients, such as those on Medicaid.
In addition, the firm has made some significant hires that point to a ramping up of operations, as well. Notably, in May 2017, former FDA chief Dr. Robert Califf was brought on board.
“I’m excited to turn to a new career with Verily and Duke University,” Califf said at the time.
Califf's oversight includes a focus on another Verily initiative, Project Baseline, which will track 10,000 people over four years.
One possible way for Verily to make its entrance, according to the business news network, would be to bring its analysis powers to health data, in order to better determine the most benefit specific patients could receive for specific care modalities, such as visiting nurses, that might keep them out of the ER.
Better allocation of resources could yield significant savings in a care market that today involves $20 billion to $25 billion in yearly expenditures. And the savings could yield substantial profits down the line as more insurers sign onto such risk-based deals, research group PWC's Ari Gottlieb told CNBC.
Underlying the move is the fact that risk analysis is in the sweet spot for giant tech firms built on data. And cutting deals with insurers means that they can do what they do best without trying to build their own insurance groups – or compete directly with insurers who know that business best.
A hint of this type of approach was revealed in 2016, when Verily cut an agreement with 3M “to develop new population health measurement technology for managing clinical and financial performance,” according to a 3M statement at he time.
The point of the deal was to create a platform “to analyze quality performance data across health care delivery systems and patient populations, and deliver meaningful information.”
