Daffodil Well being, an AI platform for well being plan administration and claims processing, has raised $16.3 million in Sequence A funding to assist scale the corporate, it introduced on Tuesday.
The San Francisco-based startup gives AI-based software program for U.S. well being plans and third-party directors to handle claims pricing and fee integrity. Its platform permits payers to deal with out-of-network repricing in-house, utilizing clear benchmarks and real-time reporting. This work has traditionally been outsourced to distributors which have constructed “multi-billion greenback companies sitting between suppliers and payers,” in response to Navin Nagiah, CEO and co-founder of Daffodil Well being. It provides a SaaS pricing mannequin, versus a percentage-of-savings pricing mannequin that firms like MultiPlan and Zelis use.
“We have now automated that whole workflow end-to-end,” he stated. “When a declare is available in, we benchmark it in opposition to market knowledge, Medicare charges, historic allowed quantities by MSA, percentile distributions, and even provider-specific acceptance historical past. It takes minutes to configure, after which the system runs robotically declare by declare. Our aim is to provide plans management, automation, and transparency at a fraction of the historic value.”
Daffodil’s Sequence A spherical was led by Flare Capital Companions, with participation from LRVHealth and Maverick Ventures. Particular person traders additionally participated, together with Scott Mingee, former CEO of Equian (which was acquired by Optum), and Jim Lacy, former president and chief working officer of Collective Medical (acquired by PointClickCare). In complete, Daffodil has raised $20.9 million.
“Daffodil is redefining how well being plans and TPAs modernize plan design, pricing, and claims infrastructure whereas serving to payors seize extra margin and ship extra member-centric experiences,” stated Parth Desai, associate at Flare Capital Companions, in a press release. “With AI-native automation and auditability in-built, Daffodil permits sooner, defensible pricing and plan design selections, at scale, that legacy incumbents and level options can’t match.”
With the financing, the corporate will scale its out-of-network repricing and pre-pay fee integrity options nationally, “so each payer can enhance their margins with out overpaying for legacy distributors,” Nagiah stated.
At the moment, healthcare represents about 20% of the U.S. financial system. About 41% of People have medical debt and 58% of U.S. debt collections are tied to medical payments. Daffodil Well being goals to maneuver the needle on this concern
“Lengthy-term, we need to modernize the engine room of healthcare,” Nagiah stated. “There was lots of innovation on the entrance door, whether or not that’s telehealth or digital well being instruments. However the plumbing and administrative infrastructure behind the scenes stays outdated. If we will rebuild that basis with trendy software program and AI, we allow extra custom-made plan design, extra transparency with employers, and finally a extra rational value construction.”
Image: Feodora Chiosea, Getty Pictures
