Inside KKR’s Newly Formed Behavioral Platform, Geode Health

The global investment giant KKR made waves earlier this month when it announced the formation of a new mental health services company called Geode Health.

Rather than buy a behavioral health platform, KKR opted to build, deepening its behavioral health footprint and creating a brand new company that aims to partner with providers to offer in-person and virtual outpatient mental health treatment across the U.S.

The new platform, which is not yet providing services, aims to “make a dent” in the nation’s mental health crisis by pursuing innovative approaches to care and multipronged growth, according to Geode CEO Gaurav Bhattacharyya.


Behavioral Health Business recently connected with Bhattacharyya to learn more about the new company’s origin story, long-term goals and growth plans. During the interview, Bhattacharyya broke down why KKR opted to build rather than buy, what Geode is looking for in behavioral health provider partners and where the new company fits into the future of industry.

You can find BHB’s conversation with Bhattacharyya below, edited for length and clarity.

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BHB: Can you explain the logistics and the business model behind Geode Health? The press release on its creation said the company will be partnering with existing providers, as well as opening new clinics. I’d love to learn more about those different growth avenues.

Bhattacharyya: We are taking what you’d call a buy-and-build approach to this market.

We will both be acquiring psychiatry and therapy practices in our key markets, as well as augmenting those through clinician recruiting and office expansions to make sure that we can treat more patients with our footprint.

We are also working with the leading commercial payers in each of our markets to get in-network so patients do not have to pay out-of-pocket and have access to more affordable care.

When you say providers, are those individual clinicians or provider practices?

It’s both. We’re looking at practices that might want to join the Geode platform, but also at individual providers who could be added onto an existing platform or potentially join us to open up a new clinic in an adjacent market or other underserved area.

A lot of BHB readers are behavioral health providers, so I’m sure they’ll see this and wonder what you’re looking for in your partners. Can you give me any color on that?

Clinical quality is at the forefront of pretty much anything we’ll do at Geode Health, so first and foremost, we want to partner with top clinical providers who are delivering high quality care.

Number two: We truly think of this as a partnership with our providers, so we want individuals who have that orientation. We are a startup, and we’re trying to do new and innovative things in this space — so we want those providers who have a change mindset and are excited to try new things so we can deliver better care to our patients.

What sort of innovative things are we talking about?

There’s a lot of opportunity to experiment and try to figure out a way to address this incredibly high need for services, whether it’s through an existing clinical model, new modalities of care or different ways of getting patient data. 

There are a lot of tools out there that get patient-reported data on a more frequent basis to inform the measurement-based therapy we could deliver, so we’re partnering with some leading clinical advisors to think about what that could look like for Geode.

It could also be things that are not “new” per se, but just having disciplined execution around it – such as a hybrid telehealth model offering both in-person and virtual visits. It could be the interdisciplinary team-based approach to care, with a psychiatrist working in concert with therapists based on what that patient needs.

What about the patient perspective? Has Geode started serving patients? And can you walk me through what that experience looks or will look like?

We haven’t officially started treating any patients under the Geode umbrella yet. We’ve started outreach in some of our key markets where we want to focus initially. We’re having conversations with providers and practices.

In terms of the patient experience, we’re offering what each of us would want if we were a patient: Patients will be treated as individuals who are able to get care in a timely fashion, and the continuity with our existing provider relationship is really important.

That, combined with this hybrid offering of both in-person and virtual services, is a really important differentiator for us. It’s also really important for the efficacy of care delivered.

KKR could have gone out and bought a platform-size company, but instead it decided to create its own with Geode. Why?

KKR has been studying this space for about two years now. I engaged with them about a year ago.

When you look at the size of the market, the rapid growth that it’s undergoing and the fragmentation of the space, what KKR and I talked about was this: We could go buy a platform, but given where a lot of these platforms are, it would probably require some cleanup, augmentation and investment. Or we could spend the same amount of time building something from scratch and end up in about the same place, but with a platform that’s much more scalable, thoughtfully put together and that positions us for really rapid growth going forward.

How big is KKR’s investment in Geode?

This investment is out of KKR’s healthcare strategic growth strategy. Typical equity checks out of this fund are in the $100 million to $200 million range, and Geode is right in that range.

Got it. Can you explain the name?

Geodes are those rocks that, when you cut them open, have the crystals on the inside.

What we really liked about the name and the symbolism is that each geode is unique. No two are alike, and the exterior of these rocks is relatively ordinary. You can’t really tell the complexity or beauty that lies inside it by looking at the outside. It takes time and nurturing for those crystals to develop inside, and, ultimately, that inner beauty is really only revealed to the world by opening it up.

As we thought about the role that we can play in helping patients open up and reveal their inner beauty to the world, we really loved that symbolism.

When it comes to the location, why Chicago for the home base?

We did an analysis of the major metropolitan statistical areas (MSAs) across the country, and scored them based on where there was the biggest need, where we think our business model could be successful from a profitability standpoint and where we saw the biggest opportunities for growth.

Based on those criteria and several metrics underneath that, we picked Chicago as one of our hubs. Me being based here helps, just from an execution standpoint, but there are a few other key regions and markets around the country that we’re also prioritizing for this initial wave.

And what markets would those be?

We haven’t publicly disclosed those yet because we’re in the process of reaching out to practices and individuals in those markets. But I think in the coming months, you’ll see more from us on partnerships that we are working on.

In terms of your growth plans, it sounds like you guys have a lot in the works. Do you have any stated goals for a year or two down the road from a growth perspective?

We plan to be very thoughtful and strategic around the providers we partner with. They need to be delivering top quality care, be highly respected in their markets and be the right cultural fit.

And so we expect a relatively stringent deal evaluation process in our early entry to ensure we’re calibrating correctly. And then once we hit our stride, we expect to run pretty fast, targeting a footprint of probably 250 to 300 centers over the next three to five years.

We certainly believe in regional density. There’s a lot of operational reasons why having local clusters is really important, from a physician engagement standpoint, from a staffing standpoint and from a payer-contracting standpoint.

We will look to establish leadership positions in the local markets that we enter, but we absolutely have aspirations to be a national provider and increase access for patients across the country.

Aside from growth, what’s your long-term vision for the company?

Ultimately, it’s to make a dent in this mental health crisis we’re facing as a country.

If we can increase access and quality for our patients and take care of our providers, we know that the results will follow. Our entire ethos and organization is going to be focused on those two things upstream, if you will.

And what do you see as the major contributors to the U.S. mental health crisis as it exists today?

Number one is access, which usually has to do with the shortage of clinicians nationwide, both for doctors, as well as therapists. The way we hope to address that is to make Geode a destination of choice for top quality clinicians — a place where they can grow, treat patients at a high quality level and expand their own professional and personal skill sets.

Then, second, there has been a lot of stigma associated with mental illness historically. Thankfully, over the past 12 to 18 months, we’ve seen a fair amount of erosion of that. People are much more comfortable talking about their own experiences with mental illness, which will cause more people to seek help when they need it.

And the third thing is, from a policy standpoint, mental health has not been on parity with other illnesses. Over the past decade or so, we’ve seen that start to evolve, and increasingly, employees are demanding that their employers include mental health as part of their standard health benefits.

The combination of all of those will continue to have tailwinds for this industry.

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