Carrum Health launched 10 years ago to develop value-based Centers of Excellence for employers, with the aim to revamp how the healthcare industry pays for and delivers specialty care.
The company, a Fierce 15 of 2025 honoree, now has 5 million lives on its platform and works with hundreds of employers, executives shared with Fierce Healthcare in an exclusive interview. The company also has nearly doubled its growth in the past year.
Carrum Health has hit a significant milestone as it expands its value-based COE network to more than 1,000 locations across the U.S. and broadens its specialty care offerings to include gynecology, gastroenterology and ear, nose and throat surgeries. The expansion makes specialty care more accessible to members and helps to tackle rising healthcare costs for employers, according to Carrum Health executives.
"We are now offering a value-based COE platform that is a true alternative to PPO [preferred provider organization] networks, for specialty care and tailored to each specialty," Sach Jain, founder and CEO, told Fierce Healthcare. "We are working with our COE partners to bring them on our platform using the right value-based care model and accountability mechanism. On the other side, we're meeting the broad specialty care needs for the patients, regardless of the specialty care and regardless of where they are located. Together, the whole solution addresses 40% of the medical spend of employers and from the network standpoint, as we look at across all specialties, we have a COE now within 50 miles of 90% of the U.S. population."
The new service lines round out Carrum’s established surgical offerings in musculoskeletal, bariatric and cardiovascular and augment the company's offerings in cancer care and substance use treatment.
Carrum's expanded services include gastroenterology, for essential screening procedures like colonoscopies and endoscopies, which an estimated 100,000 people will need annually; general surgery, which expands from bariatric surgery to now include abdominal surgeries, including hernia repairs, gall bladder removal, non-emergency appendectomies; gynecological surgeries, such as hysterectomies, fertility-preserving procedures, and pelvic floor reconstruction; pain management, emphasizing preventive care and conservative treatments to minimize the need for invasive interventions; urology and Ear, Nose and Throat (ENT) Surgeries to address issues such as deviated septum, sinus conditions, tonsillectomies, and ruptured eardrums.
Carrum built a solution that self-insured employers can deploy to connect members to a network of specialty providers, designed around the centers of excellence model. It makes specialty care services available at bundled prices and connects members to dedicated care navigation. The service also includes a 30-day warranty on surgery and two years on cancer care.
The company applied that same approach to develop a substance use treatment model using transparent, pre negotiated, bundled payments.
As the Carrum expands its specialty care offerings, the company also deliberately built the right value-based COE model for each type of specialty care, Jain noted.
“The legacy approach of using a broad brush to address all specialties doesn’t work. To impact the entire specialty care spend, you need to thoughtfully adjust the Centers of Excellence model for each specialty, and this is what we are pioneering," he said.
"Based on our years of experience in guiding members through different procedures, we realize that within specialty care, different specialties have their own nuances, and hence we need to tailor the COE solution for its specialty," Jain said. "Someone who is facing a cancer treatment knows that their survival is dependent upon it, so they will have a very different view of the quality, cost and location for that procedure, versus someone who is going to get a routine colonoscopy. Even within a specialty, patient behavior is very different. Someone who needs a chemo treatment that needs to happen every week will have the location and convenience as one of their top priorities, versus someone who is going for mastectomy and will care a lot about the track record of the oncologist for that specific treatment."
The company also has tailored its COE model payment bundles to hold providers accountable on different timelines, depending on the specialty. For instance, for MSK or cardiovascular services, the payment bundles had 30-day readmission warranties while cancer care has a two-year warranty.
"Our aim all along has been to build a true value-based alternative to PPO networks for specialty care, while keeping in mind these nuances that make specialty care unique," Jain said.
Employers face soaring healthcare costs, with another 8% increase expected this year, according to data from the Business Group on Health. Specialty care now accounts for roughly half of employer healthcare spend. Nearly 50% of employers are turning to Centers of Excellence for cancer care in 2025 to control costs and improve outcomes, with 75% planning to adopt COEs within two years.
“Over the last two years, the employers that Business Group on Health surveyed have expressed strong concerns about the upward trajectory of healthcare costs and become increasingly discerning in seeking solutions that curb costs while improving outcomes,” said Ellen Kelsay, president and CEO of Business Group on Health in a statement. “Many have recognized Centers of Excellence as one of the optimal tools in the toolkit to deliver tangible impact. Carrum Health’s investment to significantly expand access to its COE network is a timely development that will help employers bring high-quality care to even more of their members while meaningfully decreasing spend.”
Carrum developed a proprietary approach to build out its COE network, which it calls its C.A.R.E. framework. That framework is based on the following features: Curated for top 10% quality, using rigorous quality standards, applied at the facility and physician level; Appropriateness first, Carrum incentivizes providers to focus on the most appropriate treatment plan instead of the most profitable one and risk-bearing providers, as the company incentivizes providers by tying payments to outcomes across surgery, cancer care and substance use treatments.
Requiring providers to take on a risk is a key part of Carrum Health's COE framework as it ties incentives to outcomes, noted Christoph Dankert, Carrum Health's chief network officer.
"The provider bears the risk, and so they really start thinking about it in a way that they don't without these incentives, how to deliver great outcomes going forward," Dankert said. "If the outcomes aren't quite where we want them to be, within certain parameters, it's on the provider to fix it. This is very similar to when you bring your car in for repairs. If they give it back to you and something is still not working, you bring it back and they fix it at no cost. That doesn't happen healthcare. In healthcare, you have a surgery and there's a problem, you actually pay to have the problem fixed that the hospital or the physician cost in the first place. In our model, that's not the case. This is so obvious outside of healthcare, and for whatever reason, this is not how healthcare works. We believe it should work this way."
The fourth part of the C.A.R.E. framework is end-to-end transparency as the company shares provider network and pricing with employers upfront so there is no mystery about who is in the network or surprise charges.
The company says it has been independently validated to reduce unnecessary procedures by as much as 30%, lower readmissions by 80%, and save employers up to 45% per episode of surgical care.
Carrum is the only solution in the market to offer premium COEs for complex surgeries and cancer treatments like CAR-T cell therapy, featuring top 10% nationally ranked providers with complete bundled payments and warranties to ensure accountability for outcomes. This is augmented with high-quality local COEs that rank in the top 10% regionally with value-based payments for more routine care close to home, like colonoscopies, according to executives.
“Employers are looking for comprehensive solutions built around their members’ needs, that offer the full spectrum of high-quality specialty care under one umbrella, be it highly complex multidisciplinary care or simple procedures,” Dankert said.
The company recently inked a partnership with Teladoc Health to enable its providers to seamlessly refer eligible members needing specialty care into Carrum’s nationwide network of providers. The partnership enables Teladoc Health’s employer clients and members more streamlined and fully integrated access to Carrum’s value-based Centers of Excellence network for specialty care.