Commons Clinic is a group of clinics taking on large traditional medical providers like Cedars Sinai and UCLA Health. Its goal is to make spinal care more affordable and efficient.
Paulo da Costa worked in health care delivery and digital health for more than 20 years. Over that time, he witnessed the mass consolidation of physician practices — mostly by large health care systems, but also by what he deemed “inefficient” practices by private equity portfolio companies.
“Private equity portfolio companies use tactics, which some consider predatory, to buy private practices and force them into 10-plus year management services arrangements,” he told inter-TECH-ion. “As a result, physicians lose clinical autonomy and need to work harder to make up the spread of management fees and cash flows — around 20% — to the private equity portfolio company.”
So he and co-founder, Nick Aubin, created Commons Clinic. Commons is actually comprised of three multi-specialty clinics in Century City, Santa Monica and Marina del Rey.
Expansion is already underway, with a fourth, larger clinic under construction next to the Santa Monica clinic.
And, the company recently announced that it plans to invest $100 million over the next decade in a new “Center for Spine Economics, Outcomes & Research” initiative.
This is an endeavor to study and then implement “innovative care models within our spine care continuum,” da Costa told inter-TECH-ion, which includes starting with conservative care options and then moving to “cutting-edge surgical treatments.”
The $100 million is expected to come from subsequent financing rounds, da Costa said.
Commons has raised a total of $33 million to date.
Commons offers patients all-inclusive programs, starting with a focus on orthopedics and spinal care, as well as complementary services like pain management and physiatry (physical medicine and rehab).
Commons’ core service — musculoskeletal care — is a $425 billion market in the U.S.
In da Costa’s opinion, this market is “dominated by inefficient, expensive, fragmented hospital systems.”
“(Our) company aims to flip specialty care on its head by offering physicians an alternative to hospital-affiliated employment,” he said.
The ultimate goal is to attract top-tier providers who want to have autonomy.
Cedars Sinai Medical Center and UCLA Health are the two largest medical providers in the region.
“Those systems are providing transactional healthcare,” da Costa said.
He is of the opinion that any health care system operating with that kind of paradigm can leave patients “in the lurch, navigating an antiquated and complex system, with limited-to-no patient management,” he told inter-TECH-ion.
Commons recently hired “world-renowned” spine surgeon, Hyun Bae, who among other distinctions, is a professor of orthopedic surgery at Cedars Sinai.
Commons Clinic is dedicated to several “pillars” of health care, da Costa told inter-TECH-ion.
He claims that the clinics’ specialty care is “dramatically more affordable” than the competition and provides “better value.”
From robotics to new minimally-invasive techniques, Commons will be investing “enormous” resources in innovation, he said.
Surgical avoidance is another goal, when feasible.
“Commons and its physician partners are not quick to cut,” da Costa told inter-TECH-ion. “Our providers take a conservative approach to surgery and exhaust all other options/modalities before recommending that type of intervention.”
If any particular surgery can be avoided, Commons would then get reimbursed, via a value-based care bonus, he explained.
At the end of the day, it comes down to a holistic approach of treating patients over their lifespans, he told inter-TECH-ion.
Da Costa, who serves as COO, touts Commons as a “full-stack care model,” which means that it hires surgeons for its network of out-patient surgery clinics, as well as offers physical therapy and rehab.
It also has a virtual clinic that handles real-time consultations via video, phone and SMS through its own platform, along with other content patients can peruse at their convenience.
For the average Commons’ patient, all the services are bundled into “one simple, transparent price, with everything included,” da Costa said.
Patients can pay through the clinic’s app.
The clinics, similar to insurance carriers, assume full management and financial risk of the range of treatments they provide. They then get reimbursed.
And, they receive fees from in- and out-of-network patients for services like diagnostic imaging, physical therapy and virtual care.
Prior to Commons, da Costa and Aubin were early hires at Ora Oncology, and helped create a new model of “value-based” cancer care, da Costa said. This company ultimately merged into a portfolio company of its initial financial sponsor, freeing up da Costa and Aubin to focus on what is now Commons Clinic.
Also as a senior executive, da Costa helped facilitate the $550 million sale of Vantage Oncology to McKesson Specialty Health (U.S. Oncology).
Aubin, who serves as CEO of Commons, was an early employee of Heal, a company that went on to receive a $100 million strategic investment by Humana. (Heal offers primary care physician house calls).
Those experiences cemented the duo’s belief that preserving community-based healthcare is “imperative.”
“The hospital on the hill is no longer sustainable if we want affordable care, with timely access and personalized services,” da Costa told inter-TECH-ion.
Certain surgeries can cost twice or more when performed at a hospital, he explained.
Shifting the location of these services to sites with lower overhead “has proven consistently to result in better outcomes and superior patient satisfaction,” he added.
Founded in early 2021, Commons raised $900,000 using Simple Agreement for Future Equity (SAFE) notes. In August of that year, it raised a $5 million Series Seed round, led by Vast Ventures.
Commons recently closed a $20 million Series A round. It is using these funds specifically to recruit specialty physicians, hire employees and continue developing its IP.
Time BioVentures, a life sciences and healthcare VC firm based in LA, is one of Commons’ investors.
Commons has been generating revenue at an “ever-increasing” run rate since its first physicians joined in the Spring of 2022, da Costa told inter-TECH-ion. He declined to disclose the specific amount of the annual run rate.
The Commons team built its own AI-powered tech platform, which automates its operations.
It also offers tailored patient education/engagement content for Enhanced Recovery after Surgery (ERAS).
Those protocols are peer-reviewed and data-driven, da Costa said.
In development is a Peloton-style physical therapy program, with synchronous and asynchronous content.
A Full Spectrum of Care
To support its surgeons, Commons provides “experienced” care teams made up of mid-level practitioners, nurses and medical assistants, da Costa told inter-TECH-ion.
“Mid-levels typically serve as the quarterbacks under the supervision of physicians,” da Costa said. “The entire patient care journey — from a clinical perspective —is shepherded by this comprehensive team, from pre-op, day of surgery, into post-op recovery/physical therapy.”
The new Santa Monica Clinic will encompass 8,000 square feet. It’s expected to be finished sometime this summer. And will serve as Commons’ “flagship” clinic, da Costa said.
The Center for Spine Economics, Outcomes & Research initiative is expected to include a technology prong that will build, test and, ideally validate, the efficiency of new surgical techniques, as well as devices, implants, biologics, virtual intervention, robotics and software applications.
It’s also expected to include a research arm, with the goal of publishing real-world evidence and open-sourced data. The intent is to demonstrate the efficacy of new interventions developed internally, and in collaboration with industry partners like health plans, device manufacturers and technology partners.
And, also look for a post-fellowship training program to equip the next generation of musculoskeletal physicians “with the skills to thrive in, and advance, a modernized, revamped approach to spinal health,” according to a press release.