Cedar said it creates solutions for an unmet need in healthcare.
Venture capitalists with ties to major successes like Instagram and Flatiron Health have teamed up to put $36 million behind Cedar, the creator of a patient financial management platform that uses artificial intelligence and data science to help healthcare organizations get paid.
The company announced the windfall in a press release today, claiming that the Series B funding is owed to the nature of its Cedar platform and a dearth of such technology in the marketplace. To date, the New York City-based start-up has raised $49 million in its push to transform the healthcare payment system, according to the funding tracker Crunchbase.
The need for Cedar’s high-tech management platform became clear in recent years, as patients have become more responsible for paying for their care, according to the company.
“However, few existing revenue cycle solutions are fully targeted toward resolving patient payment challenges, driving increased friction between healthcare organizations and patients,” Florian Otto, MD, PhD, DDS, Cedar’s co-founder and CEO, said in a statement. “Based on our rapid growth, it’s clear that a digital health platform that simplifies patient billing transactions, drives increased engagement, and optimizes provider processes is sorely needed.”
Kinnevik, an international funding firm, led the round, with contributions from Lakestar, Sound Ventures, Kevin Systrom of Instagram, and Nat Turner of Flatiron Health. Existing investors Founders Fund and Thrive Capital also returned to pump additional cash into Cedar.
Cedar’s platform uses machine learning and data science techniques to determine the best ways to reach patients who must pony up money, create individualized payment plans, perform financial monitoring and recordkeeping, and track metrics like collection rates, the cost to collect payment, and the time taken to collect, according to the company. The product includes a patient-facing interface and a business-facing customer relationship management system.
Ultimately, it’s about meeting patients where they are—a unique and perhaps inevitable take on the patient-engagement movement that’s rippling across healthcare but is typically focused on medicine, not billing.
“Today, it’s more critical than ever to deliver a patient-first experience, particularly given the changing dynamics in the healthcare payment space,” Chris Bischoff, MBA, MA, senior investment director for Kinnevik, said in a statement. “Cedar uniquely understands these needs and has built a platform that enables healthcare organizations to engage with their patients in a seamless, delightful manner while realizing significant [return-on-investment] results.”
The company’s technology appears to be resonating with healthcare organizations, too. So far, its platform is connected to roughly 100,000 patients in the United States and assists “tens of thousands” of billing transactions every month, according to Cedar. As such, its clients have seen a “35 percent increase in collections,” a 50 percent reduction in days worked by accounts-receivable, and a 95 percent patient satisfaction rate.
Among Cedar’s clients are Montefiore Medical Center, US Anesthesia Partners, and Westmed Medical Group.
The start-up plans to use the new money to continue development of its platform and its team.
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