Olive is the buzzy startup whose purple “go preserve wellbeing care” buses dominate industry conferences. But its claims to help save health devices millions of bucks with its automation software program really don’t deliver.
- An Axios investigation finds that Olive depends on tough estimations for its calculations, inflates its capabilities and, in lots of conditions, generates only a fraction of the cost savings it pledges.
- Erin’s reporting features interviews with 16 people, together with former and present-day staff members and health and fitness tech executives.
Why it matters: Valued at $4 billion by corporations like Tiger World-wide and Vista Fairness Associates, Olive is the greatest-profile startup in overall health care automation a holy grail that claims to minimize charges and immediate additional time towards affected individual treatment.
- In just 10 yrs, Olive’s assure to reduce its clients’ administrative paying by approximately 5X the price of installing the software package has garnered the interest of some of the largest wellness systems in the U.S.
- Axios’ reporting, which involves interviews with 16 folks — which include previous and present-day staff members, overall health tech executives and some others — finds Olive is failing to supply on all those claims.
How it (must) get the job done
Olive’s profits course of action, like its peers, is made up of assessing a wellness system’s procedures to evaluate opportunity savings. The company bases individuals estimates on details collected from interviews with wellness method staff and client entry and billing departments, additionally web individual profits and publish-offs.
- Four ex-personnel say that Olive representatives commit about two weeks evaluating the opportunity personal savings it can produce for a health method.
- That is markedly distinctive than peers in the sector that shell out concerning six and 8 weeks on these evaluations, according to many health tech executives.
- Olive statements to automate administrative tasks for pharmacy and offer chain administration, and says its attempts in all those classes use AI and equipment learning.
- But 7 sources, together with existing and former staff, say none of these initiatives use AI or ML, and in its place count on the a long time-old exercise of display screen scraping, or enabling a bot to scrape data from a PDF or webpage. The observe “is notoriously risky” since the second a button is moved, “the entire process breaks,” states one particular former employee.
- They say the only automation work that meaningfully consists of AI is Olive’s function on prior authorizations, a capacity it acquired when it purchased Verata Health in 2020.
What’s happening: The savings Olive guarantees to customers are based mostly on tough estimates. The corporation does not comprehensively track its progress unless of course a buyer exclusively requests it, according to sources and quite a few inside and external documents reviewed by Axios.
- “There are hospitals that won’t contact [Olive] mainly because they know people who’ve been burned,” a single previous employee tells Axios. “And I assume folks don’t want to admit it there is a big perception of disgrace about it.”
- “Most prospects who anticipated to see $10 million in price shipped, finally bought much less than a fifth of that,” an additional ex-staff claims.
- In one occasion, a previous employee claimed they ended up explained to to compute a hospital’s prospective cost savings on a specific shelling out class by hunting at data reported by Definitive Health care and combining that with regular income figures described on Glassdoor.
- Seven people claimed that when they raised these problems to senior leaders at the firm, including founder and CEO Sean Lane, they had been brushed off or dismissed.
- Olive also employed human login data to access the health and fitness system info contained in clearinghouses like Availity to stay clear of staying detected and blocked as a bot, placing those businesses’ computer software at risk of malfunctioning, according to three recent and previous workforce.
Additionally: Many present-day and former personnel also raised worries about the dealing with of sensitive affected person data known as affected individual health and fitness information (PHI).
- In at least just one occasion, information in an inside databases that ought to have been maintained for at least 7 decades in accordance with HIPAA procedures is explained to have been deleted.
- In quite a few other cases, Olive staff members employed authentic individual information to test their equipment, instead than adhering to the regular exercise of using pretend datasets for testing, two sources explained.
Of be aware: Unless a overall health program especially requests it, Olive does not hold a detailed log of its development towards attaining its believed outcomes or expense financial savings, which the corporation phone calls “Pi” or “perpetual impression.”
- In 1 inside document seen by Axios, a vice president writes that the firm “is not genuinely meant to be the validator of affect.”
- The man or woman goes on to say that Pi — the figure it utilizes as a substitute of the sector standard return on financial commitment — “is intended to be a predetermined estimate of Olive’s influence that is agreed to pre-create to let us move forward.”
- “There were assumptions and calculations done up front and at first glance when the customer observed that, it appeared realistic,” suggests a former staff. “But there was no verification immediately after a option went stay of the affect it was driving. For Olive, I feel they understood the estimations may not be up to par.”
- In 1 inner doc viewed by Axios, an govt writes of their problem with those people assumptions, noting that Olive has no way to monitor its development or adjust its approximated discounts. “My dilemma is that we set a large amount of assumptions in our designs. If we say that Olive will decrease create-offs 20%, and it only does it 5%, then there should really be some effects from that. Similar if it lessens it 40%.”
An Epic issue
For several months, digital well being file huge Epic asked for that Olive get rid of its title from components due to the fact Olive had repeatedly misrepresented the companies’ connection in inside and exterior files, according to many previous staff members and paperwork.
- A single Slack screenshot exhibits a manager inquiring Olive workers around Slack to “help identify and deliver all the things and everything that is ‘Epic Material’ in our possession to Epic for their assessment,” like get the job done ideas, training elements and slides introduced to prospects.
Go further (<1 min. read)Other external reports, including a document from independent research company KLAS, note that Olive often over-promised on its capabilities and failed to troubleshoot problems when they came up.
- “Customers feel Olive is not proactive in addressing issues and, at times, lacks knowledge of their own product’s capabilities,” the KLAS document reads.
Internal client reporting: When it comes to outlining potential projects for hospital clients, Olive’s salespeople are given the highest levels of authority, something former and current employees say leads to missed timelines and a rushed, uncomfortable work environment.
- “There were instances where we tried to implement things multiple times based on a sales idea rather than what the hospital wanted,” says one former employee source. That former employee adds that often by the time that idea was put into action, the hospital would request it be turned off because it wasn’t helpful.
- Five sources say colleagues in the sales department justify the behavior by saying that once a hospital buys into Olive’s solutions and begins reallocating staff, it will be too difficult to remove them.
- Those situations put health systems “in this perpetually challenging position,” says one former employee source, because once they’ve put in the automation and repurposed employees, “it’s incredibly sticky.”
- “It’s a slimy way of going to market,” another employee says.
What Olive says
When contacted regarding the findings of this investigation, Olive’s spokespeople initially offered a conversation, but ultimately provided only the following statement from founder and CEO Sean Lane:
“We strongly believe automation will change the health experience for humankind. Building that sort of change isn’t easy, especially in health care with its complex data systems and high stakes. Olive is challenging health care’s legacy systems and the assumptions upon which they were built — and we are seeing tremendous progress.
Today Olive delivers 200 enterprise customers — including more than 1,000 hospitals, health systems and payers — increased revenue and reduced costs. We know this because their finance teams tell us. That’s why a majority of Olive’s sales come from expansions of existing relationships.”
Yes, but: Internal documents show Olive has roughly 80 customers, not 200.
The bottom line
Health care automation is a difficult and complicated business, and Olive — the leading company in the sector — is inflating its capabilities to drive more investment, rather than focusing on the quality of the product it delivers.