ClosedLoop.ai announced on Thursday that it raised $11 million in Series A funding, amid what CEO Andrew Eye said is widespread investment in technology that incentivizes healthcare providers to administer quality — and not just high quantity — care.
“The underlying shift from fee-for-service models to value-based care absolutely is driving a ton of interest in this area.,” Eye told Built In. “That means not waiting for you to get sick and shop at my hospital. It means reaching out to you proactively and saying: ‘How can I help you? How can I make sure you don’t shop at my hospital.’”
In 2015, the U.S. Centers for Medicare and Medicaid Services introduced several value-based care models as a way to incentivize healthcare providers to keep patients out of their facilities, with the long-term aims of improving the overall health and reducing the care cost for the U.S. population.
Unlike previous fee-for-service reimbursement models, which pay providers for individual bill charges, value-based care reimburses doctors who remind patients to schedule a follow-up visit, administer home check-ins, help individuals get the transportation they need to show up to appointments and more. Today, many private insurance companies have adopted value-based models, with the idea that investment in preventative care will lower the amount they have to pay out in claims.
ClosedLoop.ai’s AI-powered platform helps doctors identify — and rank — which patients would benefit most from this increased attention.
“Usually, healthcare organizations are trying to prioritize resources,” Eye said. “They’re trying to predict ‘who is most likely to’ and then do something different to the people at the top of that list.”
The three-year-old company offers a machine learning platform that healthcare data scientists can either use to build their own predictive models or utilize their off-the-shelf algorithms. Ultimately, its end users are physicians. And unlike other AI for other industries, Eye said bias is intentionally built into the platform.
“How do we think about bias? We build it directly into the platform,” Eye said. “Someone’s race should not impact whether they get a loan. But should you consider someone’s genetic heritage in whether or not they’re at risk for a certain disease? In some cases, it actually makes sense to do that.”
Today, the company predicts patient outcomes for 15 million people, Eye said. ClosedLoop’s COVID-19 model has impacted more than 10 million lives in the United States, he added. The 25-person company plans to double by the end of next year, and will be hiring across its teams, looking for software engineers, data scientists, product development professionals and more.
The Series A round brings total investment in ClosedLoop to $15 million. Greycroft and .406 Ventures led the round, with participation from Silicon Valley Bank and Meridian Street Capital.
ClosedLoop.ai is not the only healthtech startup that’s recently made bank thanks to investment in preventative care technology.
This week, the Chicago-based Upfront Healthcare raised $11.5 million amid rapid demand for its patient engagement tool; in October, the Chicago-based Homethrive raised $18 million to scale its caregiver support system; and in May, the New York City-based Stellar Health raised $10 million to double its team.