Tech venture aims at home health industry

[row][col sm_width=”10″ sm_offset=”1″]Nashville Business Journal
If five years as an executive in the home health industry taught Dan Hogan anything, it was that he and his peers needed more information about patients.[/col][/row]

[row][col sm_width=”10″ sm_offset=”1″]Hogan, who served as president and CEO of Doctor’s Associates Home Health in Manchester, Tenn., from 2005 to 2010, saw firsthand the need for nurses, physical therapists and doctors to have daily reports on homebound patients and the risks associated with their medications.

With smaller, “mom and pop” home health companies getting swallowed by larger competitors, Hogan saw an opportunity to take a software tool he was working on while at Doctor’s Associates and spin it into his own company, Nashville-based Medalogix.

Hogan’s is a classic tale of an innovator recognizing a need for a particular industry and branching out to provide a service that fills that need.

“I would have been able to do a better job (at Doctor’s Associates) with my clinical talent of keeping patients out of the hospital if I had a toolset like this … so we created this to address that need,” Hogan said.

And Hogan’s not the only one seeing a market for the service. Medalogix announced deals with its first two clients this month: Dayton, Ohio-based Alternate Solutions Healthcare System and Nashville-based SunCrest Healthcare Inc., which now owns Hogan’s former company, Doctor’s Associates. Both companies provide home health services, which traditionally deploy nurses, physical therapists or other health care workers to the home setting to assist patients.

Medalogix, which has three employees, was founded in 2009 and accelerated in 2011 following an $85,000 investment from partners over a three-year period. With the Medicare program attempting to cut costs associated with patient rehospitalization, Medalogix’s goal is to help home care companies — using their own clinical data — identify those patients most at risk of unplanned hospital visits.

“The significant potential Medalogix has for helping us to identify and devote extra resources to patients who are most likely to need rehospitalization is reason enough to deploy this new technology,” said Tessie Ganzsarto, president and co-founder of Alternate Solutions, which has partnerships with health care systems in Ohio, Illinois, Wisconsin and West Virginia.

While home care agencies are the primary target now, Hogan said hospital systems with home health components also are potential clients. New provisions of the federal Affordable Care Act are slated to go into effect this October that penalize hospitals when a patient is readmitted under the same diagnosis within 30 days of his or her discharge.

This may prove valuable for home care agencies, as hospitals may become more choosy about which ones they partner with and discharge patients to, said John Kiehl, chief information officer at SunCrest, which operates home health agencies in eight states.

“That is a benefit to us to be able to convince a hospital that we are the agency they should do business with when they discharge their patients,” Kiehl said.

The Medalogix tool provides a report to clients every 24 hours at midnight, though the company is working on also making it available over the Web.

“I am hugely excited about delivering this product to the health care world, because we are going to keep people in home care longer and out of the hospitals,” Hogan said.

Hogan’s own background in home care doesn’t hurt, Kiehl added.

“It’s because of his experience in home health that he saw the need (for this tool),” Kiehl said. “It helps that when he approaches us, he can speak intelligently as to why this is a win-win. In other words, he’s not just shooting in the dark. He gets it.”