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Happy Friday, health technicians!

👀 Situational awareness: Bausch Health has scrapped IPO plans for its skincare business Solta after its recent IPO of eye care spin-off Bausch + Lomb fell short of expectations. The latter, once rated by PE as a carve-out opportunity, was seen as an indicator of future public offerings.

Illustration: Aida Amer/Axios

Circulo Health, an Ohio-based health tech startup plans to lay off up to 50% of its staff as part of a bigger change in its business plan, Erin learned.

Why is this important: Circulo is one of a small but growing number of tech-driven, people-focused healthcare companies using Medicaid, a demographic that the vast majority of digital health entrepreneurs and investors have long ignored.

The context: Circulo is co-founded and led by Sean Lane, who also founded and currently leads healthcare company Olive AI. Olive recently saw the departure of more than 20 high-level employees, Axios recently reported.

Rollback: In January, Circulo acquired primary care startup Huddle Health.

  • The following month, Circulo said it had raised $50 million in Series A funding from Drive Capital, General Catalyst, Oak HC/FT and SVB Capital.
  • The company has between 300 and 350 employees, according to the sources.

What they say : Four sources, including current employees, say Circulo has undergone significant business model changes, including dropping plans to create a Medicaid-focused insurance product.

  • Instead, the company now focuses almost exclusively on home care for people with intellectual and developmental disabilities (IDD), the sources say.
  • “The program they decided to focus on is IDD,” a current employee told Axios, “so in other words, they put everything else aside.”

A Circulo spokesperson confirmed Erin’s reporting but declined to comment on the matter.