Photon's Pivot Toward Health Systems

News & Analysis from Health Tech Nerds

Q1 earnings broadly reinforced a shift away from hype narratives and toward operational execution across value-based care and healthcare services companies.

• Agilon: Stock jumped after a "turn the corner" quarter. The standout data point: new heart failure diagnoses occurring after hospital admissions reduced from 40-50% industry-wide to roughly 5%, reflecting stronger risk stratification and earlier intervention.
• Evolent: Continuing to build its oncology story — roughly 10% of the oncology market runs through Evolent today, with 50% still insourced by payers. Their thesis is that increasing complexity in oncology will push more payers toward outsourced specialty management.
• Privia: Continued its shared risk strategy with strong free cash flow and disciplined M&A patience. Management believes private-market provider enablement assets remain overpriced and are willing to wait for valuations to reset.
• Oscar: Strong quarter, with ACA enrollment attrition coming in materially better than worst-case scenarios. ICHRA and the new Lucy marketplace are the growth narratives beyond the ACA core, though Lucy still feels underdeveloped.

Zack Cooper published an op-ed in the New York Times arguing hospital market power is the primary driver of rising healthcare costs. The AHA responded, and Kevin and Martin's read is that the defensiveness itself is the signal. Recent consolidation in Minnesota and Missouri illustrates the core tension: economically problematic, but increasingly hard to avoid.

The CVS MinuteClinic / Mass General Brigham partnership gets a detailed look after Massachusetts regulators flagged a $40M annual cost increase. Most of it comes from 34,000 patients gaining a PCP for the first time — at $650 more per year in claims — plus convenience care now billing at MGB rates. A useful case study in the tradeoffs between expanding access and controlling cost.

Guest: Dan Ferris (LifeStance)
Dan discusses LifeStance's Q1 results, the return to tuck-in M&A after three years, the national rollout of interventional psychiatry including TMS and Spravato, and the accelerating shift from cash pay to insurance across behavioral health.

Guest: Patrick Foley (Belong Health)
Patrick explains why Medicare Advantage special needs plans — particularly C-SNPs — are becoming strategically important for both nationals and regional nonprofit health plans, and how SNPs enable tighter alignment between primary care, care management, and health plans while helping navigate difficult MA economics.

Guests: Sean Doolan &  Emre Karatas (Virtue VC)
Sean and Emre discuss Virtue's emerging thesis around a new actuarial infrastructure layer in healthcare, arguing that increasingly complex risk models, specialty benefit design, and value-based payment structures are creating demand for more sophisticated tooling beneath the surface of managed care markets.

Guest: Otto Sipe (Photon Health)
Otto makes the case that pharmacy is the most underutilized patient touchpoint in health systems — patients interact with pharmacy ten times more often than primary care. He walks through Photon's prescription price transparency model, the $16M raise, and why health systems thinking about patient LTV should be organizing around pharmacy cadence rather than medical claims.

For more from Health Tech Nerds, subscribe to our weekly newsletters: https://www.healthtechnerds.com/subscribe

Referenced:

Zack Cooper NYT op-ed: https://www.nytimes.com/2026/05/04/opinion/health-care-hospitals-insurance.html

AHA response to op-ed: https://www.aha.org/news/blog/2026-05-06-setting-record-straight-three-ways-hospital-blame-narrative-gets-it-wrong

Virtue VC thesis: https://www.virtuevc.com/writings/hypothesis---a-new-actuarial-infrastructure-layer-is-emerging

CVS <> Mass General Brigham CMIR: https://masshpc.gov/publications/market-oversight-report/cmir-report-mass-general-brigham-and-cvs-minuteclinic-primary

Photon's funding announcement: https://photonhealth.com/blog/series-a-growth-in-darkness