These Two Founders In Recovery Raised $118 Million For Their Virtual Addiction Treatment Startup

Workit Health founders and co-CEOs Lisa McLaughlin (L) and Robin McIntosh (R).
At the age of 18, Robin McIntosh was struggling with alcohol addiction and an eating disorder. After she was admitted to rehab, she had to pick which issue she wanted to address and the $45,000 treatment inpatient was an option that could be either-or. “I worked for 45 days on my eating disorder, left, and drank on the plane on the way home,” she recalled. Eighteen decades later, McIntosh is building the kind of holistic treatment program she would have liked to have. Workit Health, the Ann Arbor Michigan-based business she co-founded together with Lisa McLaughlin, focuses on treating specific addiction disorders and all co-occurring conditions. “We don’t know anybody that only has one diagnosis,” McIntosh says. McIntosh 36.

Workit offered online behavioral health services for a long time before the outbreak of Covid-19 that brought on-line therapy to the spotlight. Instead of focusing on abstinence-based approaches like the traditional 12-step program, The startup blends the benefits of online therapy for individuals and groups in addition to medication-assisted treatment (like buprenorphine or Naltrexone). Workit also offers what co-CEOs call “precision learning” — hundreds of online courses created by the company to enhance treatments and aid patients in tackling subjects ranging from social anxiety to stress in relationships. The idea is to take an online approach to reach out to the nine out of 10 Americans suffering from a substance use disorder who do not seek treatment due to concerns about accessibility or affordability or fear of stigma. “If we’re looking at an iceberg, we’re reaching all the people under the water that have never been reached before,” McLaughlin says. McLaughlin. “It’s pretty game-changing.”
The concept and the potential to treat more significantly than 20 million Americans who suffer from opioid and alcohol abuse disorders (not including smoking, gambling, and other addictions Workit provides to assist) have attracted top firms’ attention. On Thursday, Workit announced the closing of a $118 million Series C led by Insight Partners ($90 million equity and the remainder with debt). CVS Health Ventures, FirstMark Capital, BCBS Venture Fund, and 3L Capital also participated in the round. The round values Workit as a whole at about $500 million, as per someone familiar with the transaction. It has raised $140m of equity so far.
Over 20,000 patients have received treatment through Workit, and it has agreements with more than 230 health insurance plans that help in overcoming one of the most significant barriers to patients seeking care that is cost. While health insurance providers are expected to pay for mental health services in the same manner as physical healthcare, the cost of inpatient rehabilitation means that the patients and providers face hurdles and bureaucracy regarding reimbursement, prior authorization, and the duration of a duration of stay. The company claims that the annual cost of the average Workit patient is $4,200 and has 6000 members who are currently active. The internal data of Workit shows that over 84% of patients stay within the program for more than 30 days, with 41% of them receiving treatment for longer than one year. The majority of members of Workit are either on Medicare or Medicaid, with approximately 30% are covered by commercial insurance. Grant funds help cover the costs of uninsured and underinsured people.

“It’s amazing what their product can accomplish,” says Nicole Shimer, a vice president at Insight who was a member of Workit’s board of directors, about it being a win-win for the health insurance company and the patients. “Folks who suffer from addiction tend to be among the most costly patients for health insurance plans to cover, and simply getting treatment has been shown to significantly reduce the total costs of the patient to the insurance company. Plans can give better treatments and can also save a significant amount of money doing it. This is beneficial to both sides.”

One of the main distinguishing features Workit can offer over traditional programs is that they care for the whole person, not just addiction.
M McIntosh CIntosh met McLaughlin the first day she came to the Bay Area as a Bay Area transplant in 2009 at the nearby Alcoholics Anonymous meeting. She was employed as a designer and creative director, and McLaughlin was in educational technology. Both of them had undergrad degrees at the University of Michigan. The University of Michigan but at different times. “We’ve always had a strong connection around getting sober, getting into recovery young, staying in recovery, committing to that path,” McIntosh says. McIntosh. “And then trying to help others along the way.”
Although their recovery paths were based on the 12-step system, they also acknowledged the increasing body of research supporting the use of naltrexone or anti-depression and anxiety medications referred to as SSRIs, along with therapy and peer support. Workit employs an evidence-based method known as motivational interviewing. It is “talking to someone about how much they’re using now, how much they’d like to be using, and what are the near term steps for getting there,” McLaughlin says. “And sometimes that didn’t look like quitting.”
One of the significant distinctions Workit is different from other programs is that they focus on the entire person, not only treating addiction. For instance, Workit has primary care physicians on staff. This means that patients receive medications not just for addiction disorders but also for filling prescriptions for conditions like hepatitis and liver inflammation caused by drinking excessively or sharing syringes. The HIV preventative medication is called PREP.

However, one of the great valuable pieces of knowledge that McIntosh and McLaughlin learned from the current recovery system was the necessity to have an onsite presence. “It is a delicate balance between having a national footprint, which we’re aggressively building towards, and ensuring that every market that we’re in has local representation,” McLaughlin says. McLaughlin. This involves direct hiring doctors, nurses, social workers, and practitioners in the ten states in which the company is currently operating. Although care is provided online, Workit members also have physical clinics they can visit. The current round of funding is primarily aimed at expanding the geographic reach with the goal of “opening a state a month in 2022 until we’re national,” McIntosh explains. McIntosh.

The pair acknowledge that they don’t have that conventional Silicon Valley pedigree of an Ivy League or the business school degrees of many digital health entrepreneurs. However, they have one significant benefit that a personal experience cannot share with treatment for addiction and recovery. “Although it took us a lot longer, I think the money found us if that makes sense,” McIntosh says. McIntosh. The name Workit originates from a well-known recovery phrase: “It works if you work it.” The concept is the idea that “if you put in the work, recovery is available for anyone,” McIntosh explains. “Our job is to make sure whatever pathway you’re looking for; you can get to where you’re trying to go.”

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Adam Collins
Adam writes about technology, business and economics. With master's degree in Economics, he's presented six papers in international conferences. As a solivagant in the constant state of fernweh, curiosity is the main weapon in his arsenal.

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