Opioid addiction startup founder calls for better reimbursement and legal changes to improve access

Opioid addiction startup founder calls for better reimbursement and legal changes to improve access

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Relaxed telehealth laws during Covid have have made it easier for people to see virtual care providers no matter where they live. However, regulations such as the Ryan Haight Act limit the prescribing of controlled substances through telehealth without an initial in-person visit. And it’s unclear how the law will change once the public health emergency expires. 

One company that the laws are sure to impact is Ophelia, a digital health provider that connects prescribers over video to people who need prescriptions to manage their opioid addiction, such as Suboxone, to manage cravings, ease withdrawal, and prevent overdose. As the opioid crisis continues to wreak havoc, the company’s founder, Zack Gray, did a Zoom interview to explain how the service it offers has seen huge demand from patients. Gray is calling for broad reimbursement of the telemedicine service for Medication Assisted Therapy (MAT) after the pandemic emergency is officially declared over.

“The pandemic has helped us understand what’s possible and now it’s hard to go back to the way it was before,” Gray said. His company Ophelia offers MAT for opioid use disorder, which is considered the most effective treatment by the CDC and other agencies. Ophelia saw its first patient in April 2020. 

Gray was personally affected by the loss of a loved one to addiction. Like many suffering from opioid use disorder, that person relied on the black market, instead of going to a legal provider for prescriptions to ease withdrawal symptoms. This led him to launch Ophelia to target “the invisible 80%” of opioid use sufferers in America who are unengaged with the healthcare system until forced to due to the onset of complications.

“These patients are more or less invisible to the healthcare system until they wind up in the emergency room,” Gray said.

Once you do engage them, the results are quite promising. The startup boasts a 70% retention rate at 6 months and 60% at 12 months – in other words, patients continue to engage with Ophelia providers. It now has regional and national contracts with Medicare, Medicaid and commercial insurance covering 75 million lives. Ophelia is licensed to provide care in 29 states, including New York, where it is based as well as New Jersey, and Pennsylvania, among others.

Patient demand has been hard to keep up with, according to Gray. In order to prescribe buprenorphine, or its brand name Suboxone, clinicians need a separate license from the federal government called an x-waiver, which only 5 percent have. They are also restricted in the number of patients they can treat capped at 30 patients at a time. To solve this problem, Ophelia mobilizes physicians to get them licensed and trained to provide MAT. 

The company’s success with user retention and its ability to win national and regional CMS and commercial payer contracts have attracted significant investor attention. In December, Ophelia announced it raised $50 million in a Series B investment led by Tiger Global. That was shortly after raising $15 million in its Series A in April 2021 in a funding round led by Menlo Ventures.

It stands to gain further if federal law regarding in-person visit requirement changes. For now, Ophelia and other companies have to contend with several states that have their own version of the federal law. That, Gray believes limits access to life-saving medications.  

However, earlier this month, Florida removed some of the restrictions that limit access to Suboxone, and there are still questions as to how other states may follow suit. 

Despite the uncertain telehealth laws, Gray is optimistic that federal legislation favorable to telehealth providers treating opioid sufferers is in sight. His main concern is about state-by-state laws, and about who will cover the treatment. 

“States need to reimburse this treatment appropriately through a structure that incentivizes what matters for patients, which is retention and care,” Gray said. 

Until Medicaid plans and managed care organizations pay for treatment, most providers aren’t going to be able to offer it. 

The bottom line, Gray says, is that “MAT saves lives and saves the healthcare system a lot of money through preventing emergency treatment.”

Photo: sorbetto, Getty Images


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