Digital infrastructure startup Medallion raised $30 million from investors including UnitedHealth Group’s venture arm and key figures from Cityblock, Oscar Health and Roivant Sciences, the company announced Wednesday.
Medallion, which offers services that automate clinician licensing and insurance network compliance tasks for digital health firms, adds that new Series B money to the $20 million it previously raised sinced its founding in 2019. The San Francisco-based company is valued at $200 million, CEO Derek Lo said.
Investors in the latest round include Oscar Health CEO Mario Schlosser, Cityblock Health CEO Iyah Romm and Roivant Sciences founder Vivek Ramaswamy. UnitedHealth Group’s Optum Ventures, which participated in the Series A round, made an additional investment during the Series B. Sequoia Capital is the lead investor in the latest round and partner Andrew Reed will join Medallion’s board. Previous investors include GitHub, Segment and former San Francisco 49ers quarterback Joe Montana.
“The biggest [return on investment] isn’t speed, it’s having figured out how to run all these processes efficiently,” Lo said. “That allows our clients to more predictably and reliably get to market faster, and that can be millions of dollars in ROI. Because if a program or a new market launch is delayed by even a month, that can literally be millions of dollars of revenue lost.”
Medallion was born from a telehealth boom that continues. During the first three quarters of this year, telehealth companies raised $6.6 billion in funding, according to data from Modern Healthcare’s Digital Health Business and Technology.
The company came into being just in time for the COVID-19 pandemic to make digital medicine more common. Over the past year, Medallion’s customers have quadrupled to nearly 100, and include startups such as Firefly Health, Carbon Health and Ginger. The company’s revenue has quintupled, Lo said. In 2022, Medallion aims to triple its revenue, he said.
Now, Medallion is aiming to expand beyond digital health to incumbent healthcare payers and providers by marketing itself as an information-management platform. “Every single provider that wants to see covered lives has to be in-network with insurance payers, and that’s the vast majority of clinicians in the entire country.”
Infrastructure startups focused on streamlining the insurance industry have increasingly gained traction in digital health.
In October, insurer MVP Health Care invested an undisclosed sum to launch Belong Health, “a built-for-purpose company” that entered the market to help regional payers offer Medicare Advantage and Special Needs Plans.
This week, digital health startup nirvanaHealth launched Aria Medicare, a cloud-based platform that aims to serve as a one-stop shop for health plans looking to get into the fast-growing and lucrative privatized government program for seniors. Aria Medicare markets itself as “Medicare Advantage-in-a-box” and runs on Amazon’s cloud.
Last month, Firefly Health announced it was transforming its virtual primary care provider services to a digital-first health plan for small- to medium-sized employers looking to sidestep traditional insurance.