Substance abuse affects about 15% of American employees, Path wants to ensure they get help

America has an addiction problem.

It’s a problem that serial entrepreneur Josh Bruno has seen first hand. And it’s why he has launched a new company called Path, which pitches access to specialized substance addiction treatment professionals as an employee health benefit, to do something about it.

“I have unfortunately lost five friends now to alcohol and opioid overdoses. I went to five funerals in three years,” says Bruno. “Every time I would end up talking to friends and family afterwards… and everyone would ask, ‘What could we have done?’ “

Now Bruno is doing something. 

While Alcoholics Anonymous and rehabilitation facilities provide one solution, Bruno says that neither one has the scope to address the enormity of the problem. 

Bruno thinks Path may be the avenue to best address the issue. The idea is to provide near-instant access to specialized providers of substance abuse treatment as a benefit that employers can offer to their staff.

As the founder of HomeTeam, which provided in-home senior care and a software toolkit to manage that care, Bruno already has an understanding of the healthcare marketplace.

“We plug in to an employer and provide a holistic solution for the employees. We bring a doctor, a therapy and a coach,” says Bruno of the new service he’s launching. “We’re not a provider ourselves and we bring a network of providers.”

The business model evolved as Bruno began researching how things are currently done. “I have volunteered at AA and rehab facilities [and] I talked to labor union leaders across the country,” says Bruno. He also reached out to the nation’s 23 largest employers and shadowed treatment specialists to see how substance abuse treatment is currently handled.

“The first thing I saw is that 10% — or one in 10 adults across the U.S. — have a substance abuse disorder,” says Bruno. “That shocked people because it’s more than diabetes.”

What’s more, about 33% of mental health issues are actually addiction-related, which can add additional stress on an employers’ healthcare costs.

The founding team at Path, which includes Bruno and Gabriel Diop, who heads partnerships, and Greg Moore, who leads product development, all think of substance abuse treatment as an access issue. People looking for treatment simply don’t know where to go to get the most effective and affordable help.

“Today the health insurance company would give a list of in-network providers and it’s up to the patient to figure out where to go [and] 50% of time they go out of network,” says Bruno. 

When Path works with a large employer, a phone call is made directly to the company and that call goes to a clinical social worker, who handles the intake of a prospective patient. The company has deals with addiction doctors in the geographies where it operates and can ensure that an assessment can be done within 48 hours.

After the assessment, a treatment plan is drawn up and the company will manage that process for the employer, and the physician as well.

Path is already talking to two Fortune 100 companies about deploying its service. “It’s a targeted, regional service,” says Bruno. “Not a national service.”

The Los Angeles-based company has raised $5.35 million to date in a round of funding led by Upfront Ventures, with participation from Sequoia Benefits, Radian Street Capital and angel investors including Barbara Wachsman, the former head of benefits at Disney; Amy Shannon, the former head of benefits at Chevron; and Howard Cherny, the former head of benefits at Cisco.

“Put simply, Path plans to work with the best addiction treatment providers across the continuum in the U.S., which is exactly what is needed. Finally, a team is focusing on core issues of quality and cost-effective treatment,” said Kelly Clark, a member of the Path Clinical Advisory Board, and the former president of the American Society of Addiction Medicine.   

Not only can Path help to roll out access to treatment at scale, but the company can also reduce healthcare costs for companies, according to Bruno.

“It will lower the expense to the plan,” he says. “Approximately 30% to 50% of employees are going out of network for addiction treatment… that’s $25,000 to $50,000 per month.”

Path’s costs are substantially lower, and the company is only paid if members use the network, he said.

“Employers have made a commitment to the health and well-being of their employees. If mental health is a top priority for your organization, you can’t ignore [substance use disorders],” said Wachsman, in a statement.