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 supplies AI-based software program for U.S. well being plans and third-party directors to handle claims pricing and cost 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 line with Navin Nagiah, CEO and co-founder of Daffodil Well being. It affords a SaaS pricing mannequin, versus a percentage-of-savings pricing mannequin that firms like MultiPlan and Zelis use.
“We’ve automated that whole workflow end-to-end,” he stated. “When a declare is available in, we benchmark it towards 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 mechanically declare by declare. Our purpose is to present plans management, automation, and transparency at a fraction of the historic price.”
Daffodil’s Sequence A spherical was led by Flare Capital Companions, with participation from LRVHealth and Maverick Ventures. Particular person buyers 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 whole, 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 an announcement. “With AI-native automation and auditability in-built, Daffodil allows 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 cost integrity options nationally, “so each payer can enhance their margins with out overpaying for legacy distributors,” Nagiah stated.
At present, 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 situation
“Lengthy-term, we need to modernize the engine room of healthcare,” Nagiah stated. “There was a number 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 are able to rebuild that basis with fashionable software program and AI, we allow extra personalized plan design, extra transparency with employers, and in the end a extra rational price construction.”
Image: Feodora Chiosea, Getty Pictures
