Stellar Health announced Tuesday that it raised $10 million in Series A funding to double its team.
The NYC healthtech company aims to promote value-based care by connecting claims and clinical data in a single platform that highlights actions doctors can take to close gaps in patient care. The platform combines data from a patient’s electronic medical record and lab results to, say, remind doctors to follow-up with a patient about an overdue mammogram. If doctors can get the recommended appointment scheduled, insurance companies and other clients reward them with an additional payment on top of the appointment fee, CEO Michael Meng said.
“We spend more than any other major country in the world on healthcare, yet our outcomes are really mediocre,” Meng told Built In. “Value-based care is intended to try and change that by increasing the quality of healthcare overall while actually decreasing costs.”
The company claims its platform leads to a 50 percent increase in healthcare staff bonuses, and 10 percent decrease in insurers’ medical loss ratio, which refers to the percent of premium dollars a health plan spends on medical claims and quality improvements versus administrative costs. By investing in high-risk patients’ care, Stellar Health aims to improve individual health and decrease insurance costs long-term. But its system only works if doctors have patients to see.
In the early stages of the coronavirus, Stellar Health experienced a drop in activity on its platform, as non-emergency patients avoided the hospital. To fight decreased use, the company helped doctors set up their telehealth systems.
The company supplied doctors with platforms in compliance with HIPAA privacy guidelines. Stellar Health wrote up a guide for how doctors can bill insurance firms for telehealth appointments conducted. The business also recommended telehealth platforms healthcare providers could use.
“It was just so important in terms of treating patients, and seeing patients, that we helped [doctors] get set up on this stuff and also made sure that their business was in an OK spot,” Meng said. “We did a lot of work that we normally wouldn’t have done to really help our constituents.”
Despite the economic fallout the pandemic has brought, Meng said activity on the platform is now growing. The company counts seven large health insurance companies as customers, but a recent influx of new contracts — “We went from managing 2,000 lives last year to pushing 100,000 lives this year,” Meng said — means Stellar Health needs to double its 20-person team over the next six months to keep up with demand.
“If you do the math on the fundraising round, clearly it's enough capital to expand the team way, way beyond just the 40,” Meng said. “So I always say 40 because it's like, ‘Let's get there first.’ But, that level could easily support 50- to 100-plus new people.”
StellarHealth is looking for dev engineers with experience working in medical practices to sharpen its multisite, multidoctor feature, which helps keep track of physicians who work in multiple practices and retain patient information in a single source.
The business also plans to announce a partnership with a lab company soon, Meng said, which will make it easier to view a patient’s lab results on its platform.
Point72 Ventures led the Series B round, along with family, friends and seed investors who took their full pro rata share.