With chronic care – conditions like diabetes, COPD, cancer, hypertension and others – soaking up ever more healthcare resources, providers and insurers are searching for ways to address preventative and behavioral risks before they grow into bigger problems. Care Angel was founded in 2014 to meet that need using Artificial Intelligence and remote diagnostics and monitoring tools.

Wolf Shlagman started Care Angel after leaving an earlier, less sophisticated telemedicine company, Consult a Doctor. Now CEO, he says Care Angel’s virtual nurse, “Angel,” manages care between doctor visits, delivering “continuous engagement to patients.”

Shlagman discussed the need for remote health service like Care Angel and the outlook for his company with Karma’s Contributing Editor Michael Moran.

Michael Moran: What is the scale of the need Care Angel was designed to address?

Wolf Shlagman: The way the U.S. healthcare system works, we are only managing about 5% of the patients who need proactive management. The costs of doing so with the current infrastructure are prohibitive. I learned a lot from my own experience of caring for my father who passed away many years ago. When people are in chronic situations, having access to the right care at precisely the right time is crucial. Yet it’s considered a luxury in our society, and cost-prohibitive by the healthcare industry. But what if we could care for everybody who needed care? That was the impetus.

Michael Moran: How does the system – Angel, your virtual nurse – work in practice?

Shlagman: We set out to build a platform that we call “smart care” which would address one of the biggest factors preventing us from offering that kind of care. We don’t have enough primary care doctors, nurses, care managers, and of course we don’t have enough of the financial resources that would be necessary to care for everybody who needs it. So we really aimed to create an unlimited army of these virtual nurses, virtual care managers, virtual health assistants, powered by AI that would be able to care for everyone who needed care at the right time and also extend the human touch. With our technology, we extend the capacity of existing care teams so they can care for five to 10 times the number of people. We do this by taking over redundant repetitive, robotic tasks and leaving the clinical activities to designated care teams, this drastically reduces costs and improves outcomes.

We sell to large providers, insurers and synergistic partnerships to deploy Angel, which acts like a nurse or manager would and conversationally checks in on patients, starting with a simple phone call. We build trust with the patients with simple reminders about following their care plan, measuring their vitals, taking medications and taking a more empowered approach in their day-to-day health and wellbeing. Whether it’s populations aging at home with chronic conditions or post-operative, people need help and support to stay adherent to their care plans, medications and to simply remember what their doctor needs them to do, from taking their medications to proper exercise and rest. Angel can make sure that if there is some type of issue or needs like transportation, medical supplies or prescription refills, their Care Team or Family CareCircle gets alerted and those needs are met in a timely manner, potentially filling gaps in care that keeps people healthier and out of the hospital. Using our game-changing SmartCare platform and the transformative power of AI & ML, Angel can identify any patient who needs intervention in real time and then generate real-time alerts via email, text message, in -app, Care dashboards and even Fax if necessary to a designated care team, provider and/or family members.

Michael Moran: I want to zone in on one phrase: building trust. That’s a tall order when someone’s life is at stake. How do you go about building trust in a robot?

Shlagman: Fantastic question. There is a lot of research around how people interact with emerging technologies and how voice-powered AI assistants encourage or discourage trust. We are helping to lead the science behind how avatars and virtual assistants can help people get what they need, when they need it. Understanding the psychology and behavioral economics of why we do what we do, we infused Angel with a lot of human-like empathetic qualities and responses so in the end, people end up with a feeling of being cared for, intrinsically understanding the value of Angel and their impact in their physical and emotional wellbeing. Think about how it feels when somebody calls you ask how you’re feeling. How did you sleep, are you in pain, did you take your medications, do you need anything? And when you do have a need, Angel gets you the help you need.

In the end what makes our model different and better is continuous capability to engage in any way possible, bi-directionally from a simple phone call, text to apps and beyond. Angel is your intelligent personal health assistant, personalized to you and available 24/7. There’s a quote out there in the industry that “engagement is the super drug of the century.” Because you know in the end you must have communication, engagement, touch points and conversations with people outside of the clinical setting. Most people, if they go to the doctor or the hospital, they just get the procedure done and they go home. In 98% of the time, maybe 99%, you’re at home and between follow-up visits, nobody calls and asks, “How are you? Do you need anything?” and has the capacity to help you navigate to what you need in the moment. It’s a level of concierge-like care that has never been possible before, especially at this scale.

A couple of examples from a study with The Tremor group, a family caregiver said that, “Angel was like having an extra sibling to check in on mom.” To me, that says Angel is trusted. Angel is part of the family. When asked, another member said, “Angel was her friend.”

We live in a society that is aging, with people living much longer with more conditions more medications. Ultimately our system is not set up to manage all of this. We don’t have the dollars or infrastructure to support the billions of seniors, the poor and the rest of the population in need of continuous after-care. People need support and if they don’t get the support they end up in the hospital, which escalates costs and stretches even further already overwhelmed resources. So we have a solution that takes this from a sick care and reactive system to a more intelligent, proactive SmartCare ecosystem that really cares for people at scale and at the right moments.

Michael Moran: How do you structure your offering? How do you get paid?

Shlagman: We get paid per life on the platform, in effect, the number of lives that we manage. So our customers, as I mentioned, are large insurers or healthcare companies, health systems, MSOs, ACOs that in many cases are at risk for these vast Medicare, Medicare Advantage and Medicaid populations, especially as healthcare has gone from fee-for-service to value-based care where they get one payment and are fully at risk. We are also beginning co-development with other synergistic organizations around the world that may include pharma, pharmacy devices and others in the healthcare ecosystem. We license our solution to them so it’s kind of a white-label approach. We look to plug our solution in seamlessly in as little as 30 days and allow them to extend their capacity almost immediately and effortlessly.

We’ve just landed some major contracts with partners like UnitedHealthcare, and so we’ve grown quickly. We’re looking at a million lives on the platform by the end of the year.

In terms of an exit, I mean the most likely exit in the next two to three years is some type of M&A, or possibly an IPO. That’s less likely but anything’s possible. The key is for us to have added a few million lives – maybe three to four million lives – to the Angel platform. That’s based on the demand for what we do and the market trends, and our partnership with firms like UnitedHealthCare, who have over five million or so people to serve.

Michael Moran: What about funding? How did you fund the long startup phase – you were founded in 2014 and really only went to market in 2016 after a long development cycle.

Shlagman: Initially we did some self-funding, some of it with money from the first company exit [Consult a Doctor], and also with folks who were on board early. We then went out to seek some funding from friends and family. Between self-investment and some initial seed and friends and family, we raised about five and a half million dollars.

We’re in the process of finalizing a small round, just $2 million, and then doing planning to do a Series A round later this year or maybe Q1 of next year [2020].

Right now we’re in the process of growing very quickly, which requires laser focus on strategy and execution. We’ve gone from about 5,000 lives on the platform, in 2018 to a point where at the end of this year we project we should have close to a million lives on the platform. We’re revenue positive but not profitable. That’s not something we’re focused on in the next 12-18 months.