Vytalize Health, a risk-bearing provider assistance platform, ranked No. 1 on the 2024 Inc. 5000 list of the fastest-growing private companies in the U.S. The company’s co-founders, CEO Faris Ghawi, MBA, and Chief Medical Officer Amer Alnajar, MD, recently spoke with Healthcare Innovation about the company’s business model and impressive growth rate.
Founded in 2014 and serving more than 2,500 primary care physicians in 36 states, the company earned the top spot with revenue of $1.5 billion in 2023 and three-year revenue growth of 90,778 percent. The Hoboken, New Jersey-based company has raised more than $200 million from healthcare investors.
Healthcare Innovation: I understand that you two met in college and had complementary skills and interests — Faris in engineering and business, Amel in medicine — so together you were able to fine-tune a care delivery model that was a perfect fit for the ACO movement at the time and then dramatically scale it. Is that true?
Ghawi: Amer developed this care delivery model around conveniently providing care to patients and proactively providing care at home, and then we worked together on how to build a business model around this model and make it scalable.
HCI: What was the first thing you developed in your practice? Was it a change in workflow, or was it the introduction of a care coordinator, or was there a technology aspect to it?
Alnajar: It's multifaceted. Technology and analytics, but also the human element. We were doing house calls in the NY/NJ area, seeing seniors in their homes. Before I got into the ACO world, I noticed a lot of focus on proactive care and regular patient visits. Frankly, it sounds like a very basic thing, but I've found that when the PCP-patient relationship is established and trust is built, a lot of great things happen. What we're trying to do at Vytalize is improve that relationship. We're trying to bring some of the technology in to make sure that ADT feeds are available. Our practice is about taking care of a lot of that stuff and having more time to spend with the patient.
HCI: When you guys first got into the ACO world, were there some initial challenges around reporting and setting up infrastructure?
Ghawi: There were a lot of challenges. That's where our friendship really helped. We lived together and we worked on problems all day long. And we pivoted a lot. We probably pivoted six or seven times in every area. We pivoted our care delivery model a lot. We pivoted our go-to-market strategy a lot. We pivoted our revenue model a lot. We tried and failed. For example, in 2014, Uber was all the rage and it was very attractive to be a pure technology company. A lot of companies did that, but we felt that healthcare is different. Technology alone is not enough. You have to have all the pieces in place. You have to have the technology and the clinical pieces in place. At least initially, we wanted to be a provider. And we wanted to build our own practice and learn from it. That gave us credibility later on. We knew the care delivery model was right. We had to have the financial model. All the pieces have to be in place. So there was a lot of temptation to take the easy path, but I don't think that worked. We didn't shy away from the hard stuff if we felt it was the right thing to do.
HCI: Is your assumption of risk part of your pitch to healthcare providers in these value-based care arrangements?
Al-Najar: That's true. When we first started recruiting physicians, a lot of them told us their horror stories about joining value-based care programs, many of which were health system-led. They said, “I put in all this effort, they promised me this much money, and I got nothing and ended up losing money.” Some of our competitors charge a monthly fee to participate.
But we look at primary care physicians as the coaches and quarterbacks of the entire health system, yet they are the least compensated. They have the ability to create a lot of value within the system, but they need a way to make it happen. We help them do that, and we provide the ACOs, the capabilities, the know-how, the technology, the data, the physician partners. Physicians prefer to work with physician-led enterprises, and that's what Vytalize is. We take on all the downside risk. Vytalize makes it super easy for physicians to participate in value-based care and for patients to get that level of care.
HCI: What have been the challenges for you guys in terms of growing the company so quickly? You now have several hundred employees, right?
Ghawi: You have to try to match growth with infrastructure, but it's impossible to get it right. You end up spending too much in certain areas and too little in certain areas, and then you're trying to play catch-up, which is painful. We've made all kinds of mistakes about everything you could possibly think of, and even things that we didn't even know were possible.
Value-based care is a huge opportunity. It basically combines the complexity of insurance, the complexity of a provider, the complexity of being a technology company, and the complexity of being a fintech company, because so much of it is also finance. Each of them has its own challenges and solutions. If you miss any one of them, you're done, right?
HCI: As the company has grown, do you feel like you've been able to maintain the same culture as when you first started?
Ghawi: Absolutely. Culture is a key component. Fortunately, it's people that create culture. The people who joined Vytalize are believers in value-based care. They're optimists who have seen this system work at its best and are here to make it work at its best at scale. They've seen it with a payer, a technology company, or another value-based care company. You can improve health outcomes and reduce costs, but to really have an impact, you have to do it at scale.
HCI: Do you all have a high opinion of how CMS is implementing programs like MSSP and ACO REACH?
Alnajar: I think the direction they're going is great. I'm happy that we're finally paying for outcomes and not services. My only criticism is that I'm a big fan of value-based care, so I'd like to see it rolled out to as many PCP practices as possible. CMS has said they want all practices to be in ACOs by 2030. But the way the quality metrics work in these programs, growing too quickly hurts you. If many of the first-year practices don't have much ACO experience, they're certainly at a disadvantage in terms of shared savings. I'd like CMS to be friendly to both growing and stagnant ACOs, because they feel like they have to choose between profitability and growth. Ideally, you want to have both.
HCI: Can you tell us anything about your company’s upcoming endeavors?
Ghawi: We look forward to continuing to drive positive results. Vytalize is beginning to expand into other payer areas, including Medicare Advantage, private, and Medicaid. We have a large physician footprint, so we want to support physicians across their entire patient panel and not just focus on Medicare. We are committed to executing, delivering, and digesting this growth to ensure we bring these positive results to the practice, consolidating and strengthening our foundation for future growth.
