Category: Startups

Thatch Raises Series B to Dislodge Health Coverage From Employment 

Posted on by Jason Barry

Help is on the way for employers grappling with rising healthcare costs after Thatch locked in $40M of Series B funding to help tailor benefits to the needs of employees.

Thatch is dislodging health coverage from employment by providing individual coverage health reimbursement arrangements (ICHRA) that let employees choose their own benefits.

  • By blending fin-tech and health-tech tools, Thatch gives employers a way to “abstract away the complexity” of the ICHRA law that passed in 2020, which enabled them to provide a monthly budget to employees for selecting their own health benefits.
  • The Thatch platform streamlines budget setting, plan selection, and lowers costs through pooled purchasing power. If employees spend less than their budget, they receive a Thatch debit card to use for things like prescriptions, copays, and therapy.

Thatch CEO Chris Ellis shared on LinkedIn that one of the reasons why health coverage feels so broken is because it wasn’t designed for humans, it was designed for HR departments. 

  • Ellis has a different vision, and it’s being met with open arms: “Imagine choosing your health plan like you choose your car. Imagine keeping it when you switch jobs.”
  • Although Thatch hasn’t revealed any official revenue numbers, it’s reportedly onboarded over a thousand companies in the last 18 months – including big names like Jersey Mike’s and Dave’s Hot Chicken – and grown revenue by 8X year-over-year.

The Series B funding will allow Thatch to “double down” on its vision to make health benefits  accessible for every American through deeper integrations with carriers and payroll systems.

  • That includes an API service that allows partners to embed ICHRA directly within their own product, which already has QuickBooks signed on as a marquee client.
  • Thatch is also bringing on Gary Daniels, the former CEO for UnitedHealthcare’s Pacific Northwest division, as its new Chief Growth Officer to help make it all happen.

The Takeaway

Most current health benefits solutions were designed for a workforce that stayed with a single company for most of their careers, and have had a tough time keeping up with today’s dynamic labor market. Thatch is among a new pack of startups building the infrastructure for a modern experience, and it seems like both employers and employees have a lot to look forward to.

Layer Health Takes AI to Chart Review With Series A

Posted on by Jason Barry

The healthcare AI momentum isn’t showing any signs of letting up, and chart review automation startup Layer Health just added another $21M to the segment’s quickly growing venture total.

Layer’s AI platform leverages LLMs trained on longitudinal patient data to automate data abstraction for the medical chart reviews that underpin a wide range of clinical and administrative workflows, including: 

  • Quality Reporting & Clinical Registries – extracting data from clinical registries and quality measurement programs to improve accuracy and ensure compliance
  • Hospital Operations & Revenue Cycle – enhancing clinical documentation integrity and coding processes to optimize reimbursement and reduce denials
  • Clinical Decision-Making & Patient Care – providing physicians with real-time insights that synthesize a patient’s full medical history to support personalized treatments
  • Clinical Research & Real-World Data – accelerating patient cohort identification for research studies and improving real-world evidence generation 

Chart review has been a longstanding challenge for most health systems, which can spend upwards of $6M per hospital on personnel costs for care quality data reporting.

  • At the same time, this data represents an invaluable resource for unifying care data with clinical and financial outcomes, enabling treatment decisions to be mapped to their real-world impact.

Flare Capital Partners’ investment memo for Layer laid out how the clinical registries that map chart information to direct outcomes have historically been hamstrung by their unstructured source data.

  • Abstracting this data into a usable format is a time-consuming manual process, and most technological fixes have usually only involved automating small parts of it.
  • By combining the reasoning ability of large language models with the cost-efficiency of small language models, Flare believes that Layer can capture a major slice of the multi-billion dollar care quality reporting market (plus another chunk of the life sciences sector’s growing appetite for real-world data).

The Takeaway

Surfacing insights from medical charts requires peeling back countless layers of structured and unstructured data, which makes it particularly well-suited for both AI solutions and ambitious startups like Layer that are bringing them to market.

Navina Lands $55M to Bring AI Insights to VBC

Posted on by Jason Barry

As the number of providers transitioning to value-based care continues to grow, the need for timely clinical intelligence is climbing right alongside it, and Navina just landed $55M in Series C funding to become the definitive source for AI-driven insights.

Navina’s AI clinical intelligence platform aggregates data from a wide range of sources like the EHR and medical claims to equip clinicians with real-time recommendations for improving care quality and financial outcomes.

  • The copilot supports decision-making from the back office to the bedside, delivering insights directly within existing workflows at the point of care. This article does a good job laying out some of Navina’s levers for driving success in VBC.
  • By surfacing relevant patient information in an accessible format, Navina aims to not only improve diagnostic accuracy and care gap closure, but also to reduce burnout and administrative burdens.

Some of providers’ biggest barriers to VBC adoption are the overwhelming amounts of disparate data sources and the documentation requirements needed to produce results. It turns out that offloading these pain points is a solid strategy.

  • Navina has quickly grown to serve over 10k medical professionals delivering care to 3M patients across 1,300 clinics, and was just named #1 Best in KLAS for Clinician Digital Workflow.
  • It’s also racking up a lengthy partner roster of big names in the VBC-enablement arena, including both Agilon and Privia Health.

Navina is now setting its sights on larger provider orgs and health systems, as well as expansion into new markets across specialty care, payors, and pharmaceuticals.

  • The fresh funds were also earmarked for the 2025 flavor of the year – AI platform enhancements – and it sounds like ambient scribing is first up on the docket.

The Takeaway

Providers are increasingly getting compensated for the quality of the care they deliver rather than the volume of services they provide, but fragmented data and inefficient manual workflows have been holding back the transition. Navina now has another $55M to connect the dots to VBC success for any organization looking to make the leap.

DispatchHealth Acquires Hospital-at-Home Provider Medically Home

Posted on by Jason Barry

DispatchHealth is acquiring fellow hospital-at-home provider Medically Home to give more patients access to their preferred hospital bed: the one they already have at home.

DispatchHealth delivers full-service high-acuity care to patients across the country by sending clinicians directly to the patient’s own bedside.

  • The company’s tech platform supports diagnostics and treatment, as well as care coordination with health systems and payors.
  • Since being founded in 2013, Dispatch has treated over 1.2M people in 20 states, reportedly resulting in 58% ED avoidance and a 98% patient satisfaction rating.

Medically Home has a similar value proposition, with technology, logistics, and support services that “are unmatched in making hospital-level care possible outside of a hospital’s four walls.”

  • It also boasts an impressive list of health system investors like Cleveland Clinic, Mayo Clinic, and Kaiser Permanente.
  • The financial terms of the agreement weren’t disclosed, but Medically Home appears set to be folded into DispatchHealth when the acquisition closes mid-year 2025.

The combined company – AKA DispatchHealth – will provide in-home care across 50 major metropolitan areas through partnerships with nearly 40 health systems.

  • The move brings both companies’ tech and clinical expertise under one roof, which is expected to open up over 62k bed days and reduce total cost of care by up to 30% over a 30-day period (unclear how much of that is offloading work to family members).
  • The merger also reflects a growing trend toward consolidation in this space, where scale is crucial for reaching sustainable growth, even if it means joining forces to get there.

The clock is ticking. The acquisition arrives as the future of the federal hospital-at-home program hangs in limbo. Congress extended the program just a jew weeks ago, but only for another six months.

The Takeaway

The U.S. population isn’t getting any younger, and aging patients have been vocal about preferring care from the comfort of their own homes. In that context, DispatchHealth’s acquisition of Medically Home makes a lot of sense, and a successful merger could support the case for a long-term extension when the current hospital-at-home waiver expires in September.

Hinge Files for Long-Awaited IPO 

Posted on by Jason Barry

When the digital health market needed a hero, Hinge Health answered the call.

Hinge officially filed for its IPO, braving the biggest stock market downturn in recent memory to pull the tech-enabled services category out of a years-long slump.

  • It’s a bold move, but Hinge has the business to back it up. Using a combination of virtual care and AI, Hinge delivers MSK treatment programs with comparable outcomes to traditional physical therapy at a fraction of the cost.
  • Hinge has apparently been able to automate 95% of MSK care delivery, saving its clients (primarily employers and payors) an estimated $2,387 per member per year.

Diving into the S-1, Hinge grew its revenue by 33% to $390M in 2024. It also managed to cut its net loss from $108M down to just $12M, generating 77% gross margins in the process.

  • Hinge reported 532k members and ~200M contracted lives across 2,250 clients, and counts nearly half of the Fortune 500 as clients. 
  • Great stats all around, but a nice soundbite from the S-1 was that “current contracted lives only represent 5% of our total addressable market,” and Hinge is now on the hunt for more growth through commercial plans and Medicare Advantage.

Even with the impressive metrics, Hinge’s last private valuation came in at a rich $6.2B at the height of the pandemic, meaning that it’ll need around a 15X revenue multiple just to match it.

  • It’s not out of the question, but Hims & Hers has been one of the lone bright spots for public digital health companies, and it’s trading at just 5X revenue.

The entire tech-enabled services market feels like it hinges on this IPO, at least if you’ve been following this week’s reaction to the S-1.

  • Hinge is going to be the first health tech startup to go public since Waystar last June, and VCs have been hesitant to invest in the category given the lack of major exits.
  • If Hinge’s debut goes well, it would restore some much-needed confidence in the market, and potentially even kick off a revival in the dormant IPO landscape.

The Takeaway

Hinge is a true disrupter, with an outcomes-driven alternative to traditional physical therapy and a ton of momentum in one of healthcare’s largest markets. We’ll definitely be rooting for them when they ring the bell.

OpenEvidence Closes $75M in Series A Funding

Posted on by Jason Barry

OpenEvidence might be the new kid on the medical chatbot block, but it’s already “the fastest-growing platform for doctors in history,” and $75M of Series A funding just made it the youngest unicorn in healthcare.

Founder Daniel Nadler describes OpenEvidence as an AI copilot, with an experience that feels similar to ChatGPT yet is actually a “very different organism” due to the data it was trained on.

OpenEvidence functions as a specialized medical search engine that helps clinicians make decisions at the point of care, turning natural language queries into structured answers with detailed citations.

  • The model was purpose-built for healthcare by exclusively using training data from strategic partners like the New England Journal of Medicine – no internet forums or Reddit threads in sight.
  • The kicker? It’s available at no cost to verified physicians and generates its revenue through advertising. 

Happy users are their own growth strategy, and OpenEvidence claims that 25% of doctors in the U.S. have already used the product since its launch in 2023. It’s also adding 40k new doctors each month through word-of-mouth referrals and glowing reviews of its ability to:

  • Handle complex case-based prompts
  • Address clinical cases holistically
  • Provide really good references

The 1,000 pound gorilla in this space is Wolters Kluwer and its UpToDate clinical evidence engine. 

  • Although Wolters Kluwer has been inking partnerships with companies like Corti and Abridge to bring new AI capabilities to UpToDate, OpenEvidence is built from the ground up as an AI-first solution.
  • If WoltersKluwer is an encyclopedia, OpenEvidence is ChatGPT, and it’ll be interesting to watch the plays that both sides make as they battle for market share.

The Takeaway

OpenEvidence isn’t a solution in search of a problem, it’s a sleek new tool addressing an immediate need for plenty of providers. It’s rare to see the type of viral adoption that OpenEvidence managed to generate, which is a good reminder that many areas of healthcare change slowly… then all at once.

Abridge Lands $250M and Debuts Contextual Reasoning Engine

Posted on by Jason Barry

One of the top stories to come out of last week’s ViVE conference was Abridge closing $250M in Series D funding, yet that somehow wasn’t even the biggest news in the announcement.

On top of raising a nine-figure round at a $2.5B valuation, Abridge hit the 100 health system milestone after adding to a string of recent deployments at organizations like Mayo Clinic and Johns Hopkins.

  • Newly announced systems included Akron Children’s, Endeavor Health, Inova, Memorial Sloan Kettering Cancer Center, and Oak Street Health.

The real headliner was the debut of Abridge’s new Contextual Reasoning Engine, “an AI architecture that produces more clinically useful and billable notes at the point of care.”

The Contextual Reasoning Engine bolsters Abridge’s generative AI platform for clinical conversations with:

  • Contextual awareness – integrates data from retrospective patient encounters, health system-specific revenue cycle guidelines, and clinician documentation preferences to create more comprehensive notes. 
  • Problem detection – recognizes and groups medical problems, describing them with language that aligns with appropriate billing codes.
  • Actionable outputs – captures medical orders and integrates them into the EHR for clinician review.

Ambient scribing has been one of the hottest segments in digital health, helping clinicians spend more face-time with patients and less pajama time on administrative tasks.

  • That’s led to rapid adoption from providers, but it’s also caused plenty of vendors with core competencies outside of scribing to bolt the functionality onto their feature sets.
  • As a result, ambient AI startups are moving beyond clinical documentation to differentiate themselves with new use cases like coding or clinical decision support – and Abridge’s Contextual Reasoning Engine is only just the beginning.

The Takeaway

The ambient AI market is at an inflection point, and companies like Abridge are quickly raising capital and pouring it straight into R&D to own the workflows downstream from documentation. It’s a race to outrun commoditization and reach distribution before incumbents can catch up, and Abridge now has another $250M to help pick up the pace.

Eleos Series C Brings AI to Behavioral Healthcare

Posted on by Jason Barry

There’s riches in niches, and “the most widely deployed behavioral health AI solution on the market” just landed another $60M with Eleos Health’s Series C fundraise.

Eleos’ clinical documentation solution looks a lot like other ambient AI tech on the surface:

  • It converts session audio directly into a clinical note in near real-time
  • It works with smartphones, telehealth, and 100+ languages 
  • Providers can review the note and push through any changes

The ambient AI arena is packed with companies catering to the broad needs of health systems, but Eleos side steps that competition by focusing exclusively on community behavioral health organizations.

  • These orgs usually face tight budget constraints, don’t use a major EHR vendor, and serve primarily Medicaid patients with state-by-state documentation needs.
  • By supporting a wide range of integrations and optimizing its solution so that it can document hour-long sessions without driving up costs, Eleos has become a crowd favorite in this corner of the market. It serves 120 orgs across 30 states.

The launch of Eleos Compliance added another differentiator to the funding announcement.

  • Eleos Compliance provides an instant review of every submitted note, proactively flagging potential documentation errors before they can trigger fines or clawbacks.

The Series C will go toward Eleos’ expansion to more settings that often get missed by the latest innovations, particularly substance use treatment centers and post-acute behavioral care.

  • These historically underserved segments not only allow Eleos to help the patients who need it most, but they also let it steer clear of larger players.
  • Rock Health’s recent market overview devoted an entire section to the David vs. Goliath story unfolding in this space, and Eleos is a great example of why taking the path less traveled is a good way to avoid getting stepped on. 

The Takeaway

The number of patients seeking behavioral healthcare far outstrips the providers available to deliver it, and Eleos is looking to help balance the equation with generative AI. The race to solve clinical documentation is as heated as they come, but Eleos’ momentum and specialization are also great tailwinds.

Innovaccer Dives Into AI With Series F Raise

Posted on by Jason Barry

We’re barely halfway through the first month of 2025, and Innovaccer already raked in what could end up being the biggest raise of the year with its $275M Series F funding round.

Innovaccer got its start in 2014 with the goal of breaking down healthcare’s data siloes and using that connected fabric of information to improve care delivery. 

  • That infrastructure was made possible by Innovaccer’s Data Activation Platform, which unifies data across EHRs and care settings to deliver insights at the point of care. 
  • Innovaccer’s Health Cloud adds an entire suite of applications on top of that data layer to modernize patient experiences and alleviate administrative burdens for providers.

If Innovaccer’s last chapter was about building the infrastructure to make AI possible, the next part of its story will revolve around spearheading that new wave of solutions.

  • Innovaccer plans to introduce a bustling ecosystem of AI co-pilots and agents to its portfolio, tackling everything from prior authorization and clinical decision support to care management and contact centers. 

By throwing its hat into the ring of so many different segments, Innovaccer will be facing competition from just as many directions.

  • The health analytics arena is packed with players like Health Catalyst and Databricks. New AI scribing and revenue cycle management startups get funded every week. Customer relationship management has a 1000-pound gorilla named Salesforce.
  • The key to Innovaccer’s success will be its breadth of services, and it’s tough to name a single competitor that can match the same level of data infrastructure and co-pilot ecosystem needed to scale AI across large orgs without a mess of point solutions.

The Takeaway

Healthcare organizations have spent decades digitizing enormous amounts of data, but none of them actually want a mountain of data – they want the insights buried within it. Innovaccer helped lead the charge on creating the infrastructure, now it’s building the AI applications that can showcase the new experiences it made possible.

Transcarent Builds Benefits Behemoth With Accolade Acquisition

Posted on by Jason Barry

It’s already shaping up to be a huge year for digital health M&A, and the headlining announcement from our action-packed first week was Transcarent’s acquisition of publicly traded benefits rival Accolade.

The $621M price tag is undeniably a big move for Transcarent, which launched in 2020 to make it easier for employees to access all of their care needs through a single convenient interface, their smartphone.

  • The platform connects members to comprehensive experiences including Cancer Care, Weight Health, and Surgery Care (through provider partnerships), while also simplifying how employers manage and track that care.
  • Transcarent recently landed $126M in Series D funding at a $2.2B valuation, which it earmarked for AI innovations like its new WayFinding solution, and for taking advantage of juicy M&A opportunities in beaten-down competitors.

Accolade is a personalized health and benefits company with a long list of offerings that includes virtual-first primary care, navigation services, and expert medical opinions.

  • Despite raising $220M during its 2020 IPO, Accolade turned into an attractive acquisition target after struggling with revenue growth and booking a $100M loss during the latest fiscal year.
  • Accolate will add over 1,000 clinicians to Transcarent’s team, as well as deep data integrations with a wide partner ecosystem across diabetes, mental health, fertility, and MSK care.

Transcarent now plans to fold Accolade into its existing platform, bringing together the “best of provider, partner, and payor ecosystems.” 

  • By integrating its WayFinding and comprehensive care experiences with Accolade’s expert medical opinions and primary care, Transcarent expects to drive higher utilization and lower costs (+Accolade’s 16 years of health data for AI training was a nice kicker).

The Takeaway

At a time when point solution fatigue is crippling employers and public healthcare companies have lagged behind the broader market rally, Transcarent’s acquisition of Accolade seems like the right move at the right time. It could also mark the beginning of a much bigger M&A wave in digital health, especially if valuations continue looking too appetizing to pass up.

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