With $40M in new financing, Firefly Health targets employer-sponsored market

The Firefly Health executive team, from left to right: Jeff Greenberg, M.D., co-founder and chief network officer; Fay Rotenberg, president and CEO; Andy Ellner, M.D., co-founder and chief clinical officer; and Jonathan Bush, executive chairman (Firefly Health)

Firefly Health banked $40 million in series B funding backed by Andreessen Horowitz (a16z) to launch a new health plan benefit for employers.

Existing investors F-Prime Capital and Oak HC/FT also participated in the round. As part of the round, a16z General Partner Julie Yoo will join the Firefly Health board.

Founded in 2017 by physicians Andy Ellner, M.D., and Jeff Greenberg, M.D., Firefly Health is a tech-enabled primary care startup that uses proprietary technology and a cross-functional care team to provide members with comprehensive medical care along with proactive behavioral support and intelligent navigation.

The company is led by CEO Fay Rotenberg and Executive Chairman Jonathan Bush, co-founder and former CEO of electronic health record company Athenahealth.

Building on the success of the Firefly platform, the company will be launching a new health plan offering powered by its comprehensive primary care approach later this year to further empower navigation and incentivize members and sponsors with direct savings. Through a highly customizable benefit design, the Firefly Plan will reward intelligent choices around lifestyle and care navigation with direct savings to members and employers, according to the company in a press release.

With its full health plan benefit, Firefly Health wants to build a "digital Kaiser" with lower healthcare costs and better quality for patients, according to the company, citing Oakland, California-based vertically integrated health insurer and services provider Kaiser Permanente.

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The funding comes at a time when healthcare costs continue to skyrocket for employers, yet employees still demonstrate low interest and engagement in available care.

For employers, rethinking how they can center their healthcare strategy around the delivery and financing of comprehensive care can be a clear way to drive toward more predictable healthcare costs. Comprehensive care enables better care triage, shifts patients away from high-cost settings, reduces specialist costs and lowers the number of unnecessary referrals, according to the company.

More comprehensive care also can increase member engagement and satisfaction, improving chronic conditions and helping more members meet their health goals.

“Virtual primary care saw tremendous growth over the last year. But, disconnected, episodic care—virtual or not—does not address the overly burdensome, wildly expensive process patients typically face in the healthcare system," Rotenberg said in a statement.

Firefly Health developed a virtual-first healthcare delivery system with primary care providers, virtual specialists and behavioral health providers with a network of physical facility partners and underpinned by a technology-enabled operating platform.

“Our model, packaged as a full health benefit, makes half-priced healthcare that is twice as good clinically and emotionally a reality for all our patients," Rotenberg said.

The company currently operates in Massachusetts, Maine, New York and New Jersey and is expanding into several new markets this year.

Through Firefly's platform, each patient is assigned a care team for continuous, evidence-based virtual and in-person coaching and support. The company’s partnership network also includes on-site access to urgent care providers, home care providers, specialty care organizations such as the Dana Farber Cancer Center and the Joslin Diabetes Center as well as many specialty partners.

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The company has demonstrated a 52% decrease in ER visits as well as positive financial outcomes, including more than 30% savings on employee healthcare costs by triaging care away from high-cost settings, cutting specialist costs and reducing unnecessary referrals, according to the company.

Bush said the $40 million in new capital will accelerate Firefly’s ability to go national and bring to market a full benefit plan, "truly allowing us to bend the cost curve and further differentiate our platform to the employer community."

"The addition of a16z (Andreessen Horowitz) to an investor syndicate of health technology standouts Oak HC/FT and F-Prime Capital, adds an investor with a broad view of the opportunity for technology to change the game across industries, strong connectivity to important employer end markets, and entrepreneur-driven healthcare sensibility and expertise," Bush said in a statement.

Andreessen Horowitz's healthcare investments include Devoted Health, Omada Health, Accolade and Cedar among others.

"Firefly fits squarely into several of our investment theses around primary care and the modern health benefits stack. It’s rare to see a company that delivers on a value-based care model, while also having a tech platform that connects its care teams, patients, and outside referral partners in both the online and offline world," Yoo said in a statement.

"We’re excited to support Fay and her team as Firefly accelerates the growth of its care delivery and benefits platform to bring affordable, delightful navigation, primary care, behavioral health, and virtual specialty care to the commercial and individual insurance markets," she said.