Money Flows Into Addiction Tech, But Will It Curb Soaring Opioid Overdose Deaths?

Experts are concerned that flashy Silicon Valley technology won’t reach those most in need of treatment for substance use disorders.

David Sarabia had already sold two startups by age 26 and was sitting on enough money to never have to work another day in his life. He moved from Southern California to New York City and began to indulge in all the luxuries his newly minted millionaire status conveyed. Then it all went sideways, and his life quickly unraveled.

“I became a massive cocaine addict,” Sarabia said. “It started off just casual partying, but that escalated to pretty much anything I could get my hands on.”

At one particularly low point, Sarabia was homeless for three months, sleeping on public transportation to stay warm. Even with plenty of money in the bank, Sarabia said, he’d lost the will to live. “I’d given up,” he said.

He got back on his feet, sort of, and for the next three years lived as a “functional cocaine addict” until his best friend, Jay Greenwald, died after a night of partying. Finally, Sarabia checked himself into a rehab in Southern California — ostensibly a luxurious one, although Sarabia didn’t find it to be so.

Still, the place saved his life. The clinicians really cared, he recalled, although their efforts were hampered by clunky technology and poor management. He had the feeling that the owners were more interested in profits than in helping people recover.

Just days off cocaine, the tech entrepreneur was scribbling designs for his next startup idea: a digital platform that would make clinician paperwork easier, combined with a mobile app to guide patients through recovery. After he left treatment in 2017, Sarabia tapped his remaining wealth — about $400,000 — to fund an addiction tech company he named inRecovery.

With the nation’s opioid overdose epidemic hitting a record high of more than 100,000 deaths in 2021, effective ways to fight addiction and expand treatment access are desperately needed. Sarabia and other entrepreneurs in the realm they call addiction tech see a $42 billion U.S. market for their products and an addiction treatment field that is, in techspeak, ripe for disruption.

It has long been torn by opposing ideologies and approaches: medication-assisted treatment versus cold-turkey detox; residential treatment versus outpatient; abstinence versus harm reduction; peer support versus professional help. And most people who report struggling with substance use never manage to access treatment at all.

Tech is already offering help to some. Those who can pay out-of-pocket, or have treatment covered by an employer or insurer, can access one of a dozen addiction telemedicine startups that allow them to consult with a physician and have a medication like buprenorphine mailed directly to their home. Some of the virtual rehabs provide digital cognitive behavior treatment, with connected devices and even mail-in urine tests to monitor compliance with sobriety.

Plentiful apps offer peer support and coaching, and entrepreneurs are developing software for treatment centers that handle patient records, personalize the client’s time in rehab, and connect them to a network of peers.

But while the founders of for-profit companies may want to end suffering, said Fred Muench, clinical psychologist and president of the nonprofit Partnership to End Addiction, it all comes down to revenue.

Startup experts and clinicians working on the front lines of the drug and overdose epidemic doubt the flashy Silicon Valley technology will ever reach people in the throes of addiction who are unstably housed, financially challenged, and on the wrong side of the digital divide.

“The people who are really struggling, who really need access to substance use treatment, don’t have 5G and a smartphone,” said Dr. Aimee Moulin, a professor and behavioral health director for the Emergency Medicine Department at UC Davis Health. “I just worry that as we start to rely on these tech-heavy therapy options, we’re just creating a structure where we really leave behind the people who actually need the most help.”

The investors willing to feed millions of dollars on startups generally aren’t investing in efforts to expand treatment to the less privileged, Moulin said.

Besides, making money in the addiction tech business is tough, because addiction is a stubborn beast.

Conducting clinical trials to validate digital treatments is challenging because of users’ frequent lapses in medication adherence and follow-up, said Richard Hanbury, founder and CEO of Sana Health, a startup that uses audiovisual stimulation to relax the mind as an alternative to opioids.

There are thousands of private, nonprofit, and government-run programs and drug rehabilitation centers across the country. With so many bit players and disparate programs, startups face an uphill battle to land enough customers to generate significant revenue, he added.

After conducting a small study to ease anxiety for people detoxing off opioids, Hanbury postponed the next step, a larger study. To sell his product to the country’s sprawling array of addiction treatment providers, Hanbury decided, he would need to hire a much larger sales team than his budding company could afford.

Still, the immense need is feeding enthusiasm for addiction tech.

In San Francisco alone, more than twice as many people died from drug overdoses as from covid over the past two years. Employers, insurers, providers, families, and those suffering addiction themselves are all demanding better and affordable access to treatment, said Unity Stoakes, president and managing partner of StartUp Health.

The investment firm has launched a portfolio of seed-stage startups that aim to use technology to end addiction and the opioid epidemic. Stoakes hopes the wave of new treatment options will reduce the stigma of addiction and increase awareness and education. The emerging tools aren’t trying to remove human care for addiction, but rather “supercharge the doctor or the clinician,” he said.

While acknowledging that underserved populations are hard to reach, Stoakes said tech can expand access and enhance targeted efforts to help them. With enough startups experimenting with different types of treatment and delivery methods, hopefully one or more will succeed, he said.

Addiction telehealth startups have gained the most traction. Quit Genius, a virtual addiction treatment provider for alcohol, opioid, and nicotine dependence, raised $64 million from investors last summer, and in October, $118 million went to Workit Health, a virtual prescriber of medication-assisted treatment. Several other startups — Boulder Care, Groups Recover Together, Ophelia, Bicycle Health, and Wayspring, most of which have nearly identical telehealth and prescribing models — have landed sizable funding since the pandemic started.

Some of the startups already sell to self-insured employers, providers, and payers. Some market directly to consumers, while others are conducting clinical trials to get FDA approval they hope to parlay into steadier reimbursement. But that route involves a lot of competition, regulatory hurdles, and the need to convince payers that adding another treatment will drive down costs.

Sarabia’s inRecovery plans to use its software to help treatment centers run more efficiently and improve their patient outcomes. The startup is piloting an aftercare program, aimed at keeping patients connected to prevent relapse after treatment, with Caron Treatment Centers, a high-end nonprofit treatment provider based in Pennsylvania.

His long-term goal is to drive down costs enough to offer his service to county-run treatment centers in hopes of expanding care to the neediest. But for now, implementing the tech doesn’t come cheap, with treatment providers paying anywhere from $50,000 to $100,000 a year to license the software.

“Bottom line, for the treatment centers that don’t have consistent revenue, those on the lower end, they will probably not be able to afford something like this,” he said.

This story was produced by KHN, which publishes California Healthline, an editorially independent service of the California Health Care Foundation.

KHN (Kaiser Health News) is a national newsroom that produces in-depth journalism about health issues. Together with Policy Analysis and Polling, KHN is one of the three major operating programs at KFF (Kaiser Family Foundation). KFF is an endowed nonprofit organization providing information on health issues to the nation.

USE OUR CONTENT

This story can be republished for free (details).

Money Flows Into Addiction Tech, But Will It Curb Soaring Opioid Overdose Deaths?

Experts are concerned that flashy Silicon Valley technology won’t reach those most in need of treatment for substance use disorders.

David Sarabia had already sold two startups by age 26 and was sitting on enough money to never have to work another day in his life. He moved from Southern California to New York City and began to indulge in all the luxuries his newly minted millionaire status conveyed. Then it all went sideways, and his life quickly unraveled.

“I became a massive cocaine addict,” Sarabia said. “It started off just casual partying, but that escalated to pretty much anything I could get my hands on.”

At one particularly low point, Sarabia was homeless for three months, sleeping on public transportation to stay warm. Even with plenty of money in the bank, Sarabia said, he’d lost the will to live. “I’d given up,” he said.

He got back on his feet, sort of, and for the next three years lived as a “functional cocaine addict” until his best friend, Jay Greenwald, died after a night of partying. Finally, Sarabia checked himself into a rehab in Southern California — ostensibly a luxurious one, although Sarabia didn’t find it to be so.

Still, the place saved his life. The clinicians really cared, he recalled, although their efforts were hampered by clunky technology and poor management. He had the feeling that the owners were more interested in profits than in helping people recover.

Just days off cocaine, the tech entrepreneur was scribbling designs for his next startup idea: a digital platform that would make clinician paperwork easier, combined with a mobile app to guide patients through recovery. After he left treatment in 2017, Sarabia tapped his remaining wealth — about $400,000 — to fund an addiction tech company he named inRecovery.

With the nation’s opioid overdose epidemic hitting a record high of more than 100,000 deaths in 2021, effective ways to fight addiction and expand treatment access are desperately needed. Sarabia and other entrepreneurs in the realm they call addiction tech see a $42 billion U.S. market for their products and an addiction treatment field that is, in techspeak, ripe for disruption.

It has long been torn by opposing ideologies and approaches: medication-assisted treatment versus cold-turkey detox; residential treatment versus outpatient; abstinence versus harm reduction; peer support versus professional help. And most people who report struggling with substance use never manage to access treatment at all.

Tech is already offering help to some. Those who can pay out-of-pocket, or have treatment covered by an employer or insurer, can access one of a dozen addiction telemedicine startups that allow them to consult with a physician and have a medication like buprenorphine mailed directly to their home. Some of the virtual rehabs provide digital cognitive behavior treatment, with connected devices and even mail-in urine tests to monitor compliance with sobriety.

Plentiful apps offer peer support and coaching, and entrepreneurs are developing software for treatment centers that handle patient records, personalize the client’s time in rehab, and connect them to a network of peers.

But while the founders of for-profit companies may want to end suffering, said Fred Muench, clinical psychologist and president of the nonprofit Partnership to End Addiction, it all comes down to revenue.

Startup experts and clinicians working on the front lines of the drug and overdose epidemic doubt the flashy Silicon Valley technology will ever reach people in the throes of addiction who are unstably housed, financially challenged, and on the wrong side of the digital divide.

“The people who are really struggling, who really need access to substance use treatment, don’t have 5G and a smartphone,” said Dr. Aimee Moulin, a professor and behavioral health director for the Emergency Medicine Department at UC Davis Health. “I just worry that as we start to rely on these tech-heavy therapy options, we’re just creating a structure where we really leave behind the people who actually need the most help.”

The investors willing to feed millions of dollars on startups generally aren’t investing in efforts to expand treatment to the less privileged, Moulin said.

Besides, making money in the addiction tech business is tough, because addiction is a stubborn beast.

Conducting clinical trials to validate digital treatments is challenging because of users’ frequent lapses in medication adherence and follow-up, said Richard Hanbury, founder and CEO of Sana Health, a startup that uses audiovisual stimulation to relax the mind as an alternative to opioids.

There are thousands of private, nonprofit, and government-run programs and drug rehabilitation centers across the country. With so many bit players and disparate programs, startups face an uphill battle to land enough customers to generate significant revenue, he added.

After conducting a small study to ease anxiety for people detoxing off opioids, Hanbury postponed the next step, a larger study. To sell his product to the country’s sprawling array of addiction treatment providers, Hanbury decided, he would need to hire a much larger sales team than his budding company could afford.

Still, the immense need is feeding enthusiasm for addiction tech.

In San Francisco alone, more than twice as many people died from drug overdoses as from covid over the past two years. Employers, insurers, providers, families, and those suffering addiction themselves are all demanding better and affordable access to treatment, said Unity Stoakes, president and managing partner of StartUp Health.

The investment firm has launched a portfolio of seed-stage startups that aim to use technology to end addiction and the opioid epidemic. Stoakes hopes the wave of new treatment options will reduce the stigma of addiction and increase awareness and education. The emerging tools aren’t trying to remove human care for addiction, but rather “supercharge the doctor or the clinician,” he said.

While acknowledging that underserved populations are hard to reach, Stoakes said tech can expand access and enhance targeted efforts to help them. With enough startups experimenting with different types of treatment and delivery methods, hopefully one or more will succeed, he said.

Addiction telehealth startups have gained the most traction. Quit Genius, a virtual addiction treatment provider for alcohol, opioid, and nicotine dependence, raised $64 million from investors last summer, and in October, $118 million went to Workit Health, a virtual prescriber of medication-assisted treatment. Several other startups — Boulder Care, Groups Recover Together, Ophelia, Bicycle Health, and Wayspring, most of which have nearly identical telehealth and prescribing models — have landed sizable funding since the pandemic started.

Some of the startups already sell to self-insured employers, providers, and payers. Some market directly to consumers, while others are conducting clinical trials to get FDA approval they hope to parlay into steadier reimbursement. But that route involves a lot of competition, regulatory hurdles, and the need to convince payers that adding another treatment will drive down costs.

Sarabia’s inRecovery plans to use its software to help treatment centers run more efficiently and improve their patient outcomes. The startup is piloting an aftercare program, aimed at keeping patients connected to prevent relapse after treatment, with Caron Treatment Centers, a high-end nonprofit treatment provider based in Pennsylvania.

His long-term goal is to drive down costs enough to offer his service to county-run treatment centers in hopes of expanding care to the neediest. But for now, implementing the tech doesn’t come cheap, with treatment providers paying anywhere from $50,000 to $100,000 a year to license the software.

“Bottom line, for the treatment centers that don’t have consistent revenue, those on the lower end, they will probably not be able to afford something like this,” he said.

This story was produced by KHN, which publishes California Healthline, an editorially independent service of the California Health Care Foundation.

KHN (Kaiser Health News) is a national newsroom that produces in-depth journalism about health issues. Together with Policy Analysis and Polling, KHN is one of the three major operating programs at KFF (Kaiser Family Foundation). KFF is an endowed nonprofit organization providing information on health issues to the nation.

USE OUR CONTENT

This story can be republished for free (details).

Coronavirus Crisis Opens Access To Online Opioid Addiction Treatment

Under the national emergency, the government has waived a law that required patients to have an in-person visit with a physician before they could be prescribed drugs that help quell withdrawal symptoms, such as Suboxone. Now they can get those prescriptions via a phone call or videoconference with a doctor. That may give video addiction therapy a kick-start.

[UPDATED on April 28]

Opioid addiction isn’t taking a break during the coronavirus pandemic.

But the U.S. response to the viral crisis is making addiction treatment easier to get.

Under the national emergency declared by the Trump administration in March, the government has suspended a federal law that required patients to have an in-person visit with a physician before they could be prescribed drugs that help quell withdrawal symptoms, such as Suboxone. Patients can now get those prescriptions via a phone call or videoconference with a doctor.

Addiction experts have been calling for that change for years to help expand access for patients in many parts of country that have shortages of physicians eligible to prescribe these medication-assisted treatments. A federal report in January found that 40% of U.S. counties don’t have a single health care provider approved to prescribe buprenorphine, an active ingredient in Suboxone.

A 2018 law called for the new policy, but regulations were never finalized.

“I wish there was another way to get this done besides a pandemic,” said Dr. David Kan, chief medical officer of Bright Heart Health, a Walnut Creek, California, company. It has recently started working with insurers and health providers to help addicted patients get therapy and medications without having to leave their homes. He said he hopes the administration will make the changes permanent after the national emergency ends.

For years before the emergency regulations, Bright Heart — along with several other telemedicine counseling providers — began offering opioid addiction treatment and counseling via telemedicine, even if they couldn’t prescribe initial medication for addiction. Patients can renew prescriptions for drugs to deal with withdrawal symptoms, get drug-tested and meet with counselors for therapy.

When Nathan Post needed help overcoming a decade-long drug addiction, he went online in 2018 and used Bright Heart Health to connect to a doctor and weekly individual and group counseling sessions. He said the convenience is a big benefit.

“As an addict, it was easy to have excuses not to do stuff, but this was easy because I could just be in my living room and turn on my computer, so I had no reason to blow it off,” he said.

Post, 38, a tattoo artist who recently moved from New Mexico to Iowa City, Iowa, was addicted to Suboxone, the drug he was prescribed in 2009 to deal with an addiction to opioid pills.

Officials with the insurer Anthem said using Bright Heart’s telemedicine option has helped increase medication-assisted treatment for members with opioid drug abuse issues from California and nine other states from 16% to more than 30%. While fewer than 5% of Anthem patients seeking addiction treatment use telemedicine, the company expects the option to become more common.

Bright Heart Health officials say one barometer of the effectiveness of the care is that 90% of patients are still in treatment after 30 days and 65% after 90 days — far higher than with traditional treatment.

Several insurers — including Aetna, and Blue Cross and Blue Shield companies like Anthem across the country — have begun covering the telemedicine addiction service.

Dr. Miriam Komaromy, medical director of Boston Medical Center’s Grayken Center for Addiction, said there are some downsides to virtual care.

“I think therapists and providers do worry whether it provides the same level of engagement with the patient and whether it’s possible to gauge someone’s sincerity and level of motivation as easily over a camera as in person,” she said.

But she predicted telemedicine service will grow because of the tremendous need to broaden access to mental health and addiction counseling. “Too often the default is no counseling for patients,” she said. “This gives us another set of tools.”

Patients can also have trouble finding a doctor who is eligible to prescribe medication to help treat addiction. Physicians are required to get a federal license to prescribe Suboxone and other controlled substances that help patients with opioid addictions and can write only limited numbers of prescriptions each month. Many doctors hesitate to seek that qualification.

A few small studies have found that patients are as likely to stay with telemedicine treatment as with in-person care for drug addiction. But no studies have determined whether one type of therapy is more effective.

Telemedicine does have its limits — and is not right for everyone, particularly patients who require more intensive inpatient care or who lack easy internet access, Komaromy said.

Premera Blue Cross and Blue Shield officials said they are partnering with Boulder Care, a digital recovery program based in Portland, Oregon, to help customers in rural Alaska. “Telemedicine is a unique way for someone to go through treatment in a discreet manner,” said Rick Abbott, a Premera vice president.

Nathan Post, a tattoo artist living in Iowa City, Iowa, used a telemedicine service to help overcome his addiction to Suboxone. “This was easy because I could just be in my living room and turn on my computer, so I had no reason to blow it off,” he says. (Courtesy of Nathan Post)

While telemedicine has been growing in popularity for physical medicine, some people may still be reluctant to use it for drug addiction.

There are also concerns that allowing providers to prescribe controlled substances without meeting patients in person could increase the risks of fraud.

“There is a fear around this that there may be some rogue providers who make a lot of money off addiction and will do it stealthily on the internet,” said Dr. Alyson Smith, an addiction medical specialist with Boulder Care. “While that is a small risk, we have to compare it to the huge benefit of expanding treatment that will save lives.”

Smith said she doesn’t notice a big difference in treating patients for drug addiction in her office compared with on a video screen. She can still see patients’ pupils to make sure they are dilated and ask them about how they are feeling — which can determine whether it’s appropriate to prescribe certain drugs. Dilated pupils are a sign of patients suffering from withdrawal from heroin and other drugs.

Dr. Dawn Abriel, who treated Post and previously directed a methadone clinic in Albuquerque, New Mexico, said she can diagnose patients over video without issue.

“I can pick up an awful lot on the video,” particularly a patient’s body language, she said. “I think people open up to me more because they are sitting in their homes and in their place of comfort.”

In West Virginia, one of the states hardest hit by the opioid addiction epidemic, Highmark, a Blue Cross and Blue Shield company, started offering telehealth addiction coverage with Bright Heart Health in January. Highmark officials say a lack of providers, particularly in rural parts of the state, meant that many of the insurer’s members had difficulty finding the help they need.

Dr. Caesar DeLeo, vice president and executive medical director of strategic initiatives for Highmark, said the insurer was having problems getting customers into care. Only about a third of members with addiction issues were receiving treatment, he said.

“We needed to address the crisis with a new approach,” DeLeo said. “This will give people more options and give primary care doctors who do not want to prescribe Suboxone another place to refer patients.”

DeLeo said patients will also be referred to Bright Heart in hospital emergency rooms.

Dr. Paul Leonard, an emergency doctor and medical director for Workit Health, an Ann Arbor, Michigan, company offering telemedicine treatment and counseling programs, said many patients who turn to ERs for addiction treatment get little help finding counseling. With online therapy, patients can sign up while still in the ER.

“We’ve built a better mousetrap,” Leonard said.

Telemedicine addiction providers said they and their patients are getting more accustomed to virtual care.

“There are always times you wish you could reach out and hold someone’s hand, and you can’t do that,” said Boulder’s Smith. “But we feel like we are more skilled at a virtual hand-holding and really connect with people and they feel well supported in return.”