Tulane venture fund makes its first investment in New Orleans health care startup

Tulane University’s new $10 million innovation fund has invested in New Orleans startup Nest Health, a fast-growing company specializing in providing home health care visits for families on Medicaid.

Founded just over two years ago by Rebekah Gee and Rebecca Kavoussi, Nest Health has grown its network to around 3,000 patients in the New Orleans area, according to Gee, an OB-GYN who served as Secretary of the Louisiana Department of Health from 2016 to 2020 under Gov. John Bel Edwards.

“We are a ‘value-based care company,’ meaning we get paid to improve outcomes and lower the cost of care,” Gee said Monday.

The investment of $250,000 is the first made by Tulane Ventures, which was set up by the Tulane University Innovation Institute. Tulane and Louisiana Economic Development each have provided $5 million for investments made through the new fund.

Last year, Nest Health raised $15 million of major early-stage investment, led by Austin, Texas-based 8VC, with the Blue Venture Fund, MVP, Health 2047, and Gaingels also investing.

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Dr. Rebekah Gee, Founder and CEO of Nest Health, left, talks with Rosa Aguilar, right, during a diaper drive at the Crescent City Family Services in Gretna on Thursday, March 9, 2023. Nest Health and Crescent City Family Services held the event. (Photo by Brett Duke, NOLA.com | The Times-Picayune)

Nest Health is now $450,000 shy of raising a target amount of $20.5 million. The additional $5.5 million fund-raising this year is being led by Massachussetts-based venture capital firm SpringTide.

In July, Ochsner Louisiana Innovation Fund invested $500,000 in Nest.

Both Ochsner and Tulane’s investments were made possible by matching funds from a $113 million pot of federal dollars administered by LED. That money came from of the $10 billion State Small Business Credit Initiative, which was launched in 2021 as part of the Biden Administration’s $1.9 trillion American Rescue Plan stimulus package.

It is targeted at underserved groups, including women, military veterans, Black entrepreneurs and rural communities.

Speeding up wait times

In its first year of operations, Nest Health has seen a 50% reduction in emergency room visits among the patients in their network, Gee said, adding they have also seen large reductions in wait times for those seeking help with behavioral and mental health issues.

Nest Health has been able to arrange for mental health care professionals on site to deal with issues within 24 hours of identifying the need. By contrast, Gee said, she had to wait last year for seven months to get help for a family member.

“The healthcare system is fragmented,” said Gee, who was CEO of Health Care Services for LSU Health before heading up the state’s health department.

“It separates pregnant women from women who’re not pregnant, it separates people’s brains from their bodies,” she said. “If you have multiple children we make it nearly impossible.”

Community care

She said Nest Health spent 2022 doing research among New Orleans area families. Her team focused on people who found it difficult to arrange for primary care in homes where several children might need to see a doctor, but working parents couldn’t find the time.

“We really focus on people who need the care, which we have identified through their claims history and the high cost of providing it,” she added. “As a result of being first company in the U.S. to provide value-based care to a family unit at home, we’ve been successful in our fundraising.”

Gee said Nest Health has secured its first Medicaid health plan payer, and she expects another to sign soon. They are also looking to sign up a commercial payer in September.

The new round of investment will be used to expand locally, and to start operations in at least two other states next year.

Author: Health Watch Minute

Health Watch Minute Provides the latest health information, from around the globe.