Neil Batlivala has spent seven years building something most of Silicon Valley doesn’t care about: a healthcare company that actually serves the people nobody else wants to serve.
But last month, that obscurity ended. Pair Team, his outfit, got picked as one of just 150 organizations nationwide to participate in ACCESS, a new Medicare program designed to test what AI-driven medical care looks like at federal scale. The program launches July 5, and it represents something genuinely novel in American healthcare: the government deliberately creating space for AI to reshape how medicine gets funded and delivered.
“The government is creating swim lanes for AI innovation in traditionally regulated industries,” Batlivala told reporters. “The best solution wins, which, in regulated industries like healthcare, that’s not been the case.”
That might sound like standard startup cheerleading, but there’s real meat here. For the first time, Medicare has a payment mechanism that doesn’t just reward doctors for showing up. It rewards outcomes. Lower blood pressure. Reduced pain. Patients actually getting healthier.
The Problem With How Medicare Pays For Care
Traditional Medicare operates on a simple, dumb principle: it reimburses clinicians for time spent. Fifteen minutes with a doctor? You get paid for fifteen minutes. Never mind whether the patient actually gets better. Never mind whether an AI system could monitor that patient between visits, remind them to take their medication, or coordinate a referral to housing services.
ACCESS, which stands for Advancing Chronic Care with Effective, Scalable Solutions, changes that. It’s a 10-year program covering diabetes, hypertension, chronic kidney disease, obesity, depression, and anxiety. Organizations that participate get predictable monthly payments for managing qualifying conditions, but they only earn the full amount when patients actually hit measurable health goals.
That’s not revolutionary in tech or business generally. Outcome-based payment is standard. But in healthcare, a world where regulations have historically strangled innovation, it’s transformative. “It’s a payment model transformation,” Batlivala said. “You just couldn’t do this before.”
The first cohort of 150 participants spans the usual suspects: AI doctor startups, virtual nutrition therapy providers, connected device companies, even wearable makers like Whoop. But Batlivala, characteristically, isn’t impressed across the board. “I’m a big fan of wearables, but for a senior who’s struggling with food insecurity, I don’t know how much Whoop is going to be able to do,” he said.
Why Pair Team Actually Built Something Different
Pair Team started in 2019 with a specific thesis: you cannot improve health outcomes without addressing the full context of someone’s life. That sounds simple. It’s not. About a third of Americans managing chronic conditions also deal with unstable housing, food insecurity, or lack of transportation. Most digital health companies ignore those people entirely.
Pair Team didn’t. The company now employs roughly 850 clinical professionals, runs what it describes as the largest community health workforce in California, and generates revenue above nine figures. It’s raised about $30 million from Kleiner Perkins, Kraft Ventures, and others. More importantly, it has peer-reviewed evidence backing its model. A study published in the Journal of General Internal Medicine showed that Pair Team’s approach, which blends medical, behavioral, and social care, produced strong patient engagement and significant reductions in emergency and inpatient utilization. One in four hospital visits and one in two ER visits don’t happen, according to Batlivala.
But there was always a constraint: human teams can’t scale cheaply or quickly. So about nine months ago, Pair Team deployed Flora, a voice AI agent that handles patient intake, coordinates referrals, and does check-ins between clinical visits. Available 24 hours a day.
The shift was profound. Batlivala described a call with a 67-year-old woman living out of her car, managing PTSD and congestive heart failure. She spoke with Flora for over an hour. “It was both incredible and depressing,” he said. “Flora was probably the only person she’d talked to in weeks about her situation.” Now those hour-long conversations happen routinely. The companionship itself, it turns out, is an intervention.
The Architects of ACCESS Understand Startup Thinking
Here’s where it gets interesting: ACCESS wasn’t designed by career bureaucrats. It was built by Abe Sutton, Director of the CMS Innovation Center (formerly a venture capitalist at a healthcare fund called Rubicon Founders) and Jacob Shiff, Chief AI and Technology Officer of the CMS Innovation Center (a former healthcare founder). Both joined under the Trump administration, and their startup DNA shows: outcome-based payments, direct-to-consumer enrollment, explicit competition among providers.
That’s refreshing. It’s also risky.
The Real Risks Everyone Should Discuss
First, there’s data security. Pair Team and other ACCESS participants are feeding extraordinarily sensitive patient information into federal infrastructure. We’re talking intimate conversations about housing, disease, and mental illness flowing into a system with a documented history of breaches, including exposed Social Security numbers. For the vulnerable populations ACCESS targets, that’s not some abstract concern. It’s real.
Then there’s the financial side. The CMS Innovation Center’s track record is mixed at best. A 2023 Congressional Budget Office analysis found that the CMS Innovation Center increased federal spending by $5.4 billion during its first decade rather than producing projected savings. And Medicare is paying less per patient per month than many participants anticipated. The math only works if you’ve fully automated most of your patient interactions.
Batlivala doesn’t flinch here. “If you want to build a model that truly incentivizes the use of AI, the reimbursement rates have to be low,” he said. “The economics only work if you’re running a lean, AI-first operation.”
That’s either visionary or a warning sign, depending on your perspective. Maybe both.
What Happens Next
Pair Team says it has partnerships giving it access to roughly 500,000 potential patients. It wants to reach a million within three years. Healthcare investors have been watching closely. Digital health funding hit its highest Q1 total since the pandemic this year, with AI companies capturing the bulk of it.
But ACCESS itself has barely registered outside health tech trade press. Most of Silicon Valley still doesn’t know it exists. That might change fast, or it might not. Sometimes the most important technology innovations happen quietly, in the places nobody’s looking.
