Six years after launching its service linking employer-sponsored insurance plans with surgical centers of excellence, Carrum Health has raised $40 million in a new round of financing to capitalize on tailwinds propelling its business forward.
As the COVID-19 pandemic exposes cracks in the U.S. healthcare system, one of the ways that employers have tried to manage the significant costs of insuring employees is by taking on the management of care themselves.
As they shoulder more of the burden, companies like Carrum, which offer services that manage some of the necessary points of care for businesses, at lower costs, are becoming increasingly attractive targets for investors.
That’s why Carrum was able to attract investors led by Tiger Global Management, GreatPoint Ventures and Cross Creek, all firms that joined returning investors Wildcat Venture Partners and SpringRock Ventures in backing the company’s Series A round.
Carrum said the money will go toward sales and marketing to more customers, adding more services and improving its existing technology stack.
Carrum uses machine learning to collect and analyze data on surgical outcomes and care to identify what it considers to be surgical centers of excellence across the U.S.
The company offers self-insured employers the opportunity to buy services directly from surgical centers for a bundled price. That can mean savings of up to 50% on surgical expenses.
Using Carrum, there are no co-pays, deductibles or co-insurance. Instead, Carrum Health’s customers pay a fee and in return receive a 30-day warranty on procedures, meaning that the healthcare provider will cover any costs associated with care from botched operations or complications.
Employees have access to a mobile application that gives them access to virtual care before, during and after surgeries.
“For years, the industry has talked about redesigning healthcare to benefit patients, but the only way to really do that is to tackle the underlying economics of care, a truly difficult task,” said Sach Jain, CEO and founder of Carrum Health, in a statement. “Employers now have a modern, technology-driven solution to help patients get better care without financial headache and we’re not stopping at surgery. In 2021 we’ll be expanding our reach and impact with additional services. It’s such an honor to pave the way for a better healthcare future and we’re so excited for what’s to come.”
Carrum Health’s customers include Quest Diagnostics, US Foods, and other, undisclosed organizations in retail, manufacturing, communications and insurance, the company said.
Centers of excellence on the platform include Johns Hopkins HealthCare, Mayo Clinic and Tenet Healthcare.