HerMD, a specialized women’s healthcare provider, will shut down all locations on March 21, 2025, leaving more than 25,000 patients without access to its menopause and sexual healthcare services. The closure happens just 20 months after securing $18 million in Series A funding for an ambitious expansion plan. The sudden shutdown raises questions about the sustainability of specialized healthcare models, particularly those relying on physical clinics. Several industry experts suggest that outsourcing and hiring healthcare virtual assistants eased financial pressures and helped keep the company running.
HerMD’s Expansion and Sudden End
Dr. Somi Javaid founded HerMD in 2015, starting with a single clinic in Cincinnati before expanding to Kentucky and beyond. The company differentiated itself by providing comprehensive care for menopause and sexual health, areas often overlooked in traditional gynecological services. Its model included longer appointment times (20-60 minutes) and insurance acceptance, making specialized care more accessible for many women.
HerMD attracted investors’ attention, securing $10 million in 2022 to expand operations and develop telehealth services. By 2023, they raised an additional $18 million in Series A funding to support plans for 200+ new clinics nationwide. Patients traveled from across the U.S. and Canada for HerMD’s services, showing clear demand for this type of care.
Yet HerMD suddenly announced its closure, citing “ongoing challenges in healthcare.” While they didn’t give specific details, financial difficulties, high administrative costs, and complications in scaling physical locations likely contributed. The company possibly expanded faster than its operational infrastructure could handle, ultimately making it impossible to continue despite strong patient demand.
Financial Burden of Running a Specialized Healthcare Clinic
Running a clinic with a narrow focus presents financial and logistical hurdles. Unlike general practices that see high patient volume, clinics like HerMD require longer visits and specialized staff, leading to higher costs and more complex operations.
Reports show that administrative expenses in these clinics can make up 20-30% of revenue, compared to 15% in general medical practices. These costs come from complicated billing, extended patient interactions, and regulatory compliance. HerMD’s need for a high staff-to-patient ratio to maintain quality care may have made it difficult to sustain operations.
Expanding a physical healthcare business is no small task. Each new location requires regulatory approval, trained personnel, and large investments. While HerMD set aggressive goals for growth, inefficiencies may have made expansion unmanageable.
Could Virtual Assistants Have Made a Difference?
Virtual healthcare assistants handle essential administrative functions like medical billing, appointment scheduling, and insurance claim management. Outsourcing these tasks allows clinics to reduce overhead while maintaining quality patient care. Given HerMD’s extensive administrative processes, introducing virtual assistants might have helped streamline operations and extend their financial runway.
“The closure of HerMD affects women’s healthcare substantially. Many specialized providers spend 35-40% of their budgets on non-clinical functions. Better administrative efficiency could free up resources for patient care,” says Winston Ong, CEO of BruntWork, a company specializing in healthcare outsourcing.
However, some experts disagree with the idea of virtual assistants being an ideal solution. Some argue that offshore assistants may lack the cultural understanding and specialized knowledge needed for women’s health services. “While virtual support reduces costs, sensitive healthcare areas need staff who thoroughly understand patient concerns,” says an industry consultant experienced in femtech ventures.
Ong responds that proper training addresses these concerns. “We’ve created healthcare-specific training programs to prepare virtual assistants for specialized providers’ needs. Our healthcare assistants typically stay with us for 2.8 years, maintaining consistency in patient interactions,” he says.
What Women’s Health Startups Can Learn from HerMD
HerMD’s closure offers important lessons for specialized healthcare startups. Demand for women’s health services is strong, but poor financial management and aggressive expansion can put even well-funded companies at risk. Future providers must find ways to stay financially stable while keeping patient care a priority.
Using virtual support from the start could help clinics operate efficiently without sacrificing the patient experience. However, virtual assistants aren’t the only option. Other approaches, like alternative funding models, partnerships, and stronger telehealth offerings, could also help providers stay afloat.
