Hartford HealthCare’s new administrative headquarters are in a nondescript building, on a street lined with other nondescript buildings. But the 110,000-square-foot building, which cost the system around $14 million to renovate, is flashier inside. Visitors are greeted by a setup that looks straight out of Silicon Valley: a professional TV and media studio, murals, inspirational photos and phrases on the walls, and a wavy-looking ceiling meant to indicate change and innovation.
Six weeks after it opened the doors of its downtown location in October, the seven-hospital system announced partnerships with two venture capital firms, the Morningside Group and Connecticut Innovations, to bring startup leaders into the incubator space to develop pilots and work with clinical experts. The initiatives are similar to another venture capital collaboration Hartford made in March 2020 with the Israel Innovation Authority, an Israel-backed venture fund.
“Embracing innovation is a central part of our culture and we needed to bring people together in an environment that could foster it,” said Hartford President and CEO Jeffrey Flaks.
Across the country, health systems are responding to financial struggles and competition from retail and big tech disrupters by working with venture capital firms and their portfolio companies to implement digital health technology across clinical and administrative systems. The goals are to enhance operational efficiencies and increase access to care. Ethicists say, however, that health systems need to be careful not to breach clinician and patient trust in the name of added revenue.
“It’s a super difficult operating environment,” said Dr. Ron Paulus, former president and CEO of Asheville, North Carolina-based Mission Health and an adviser at venture capital firm General Catalyst, which has partnered with 15 health systems. “When you’re at a health system, you’re so consumed by the day-to-day activities and challenges, it’s hard to put your head up above the clouds and look around. That’s exactly what VC firms do every day.”