Iora Health has raised $28 million in a Series C funding round as the primary care provider plans to double the number of practices it operates in the next year.
The new financing will help the company, founded in 2011 by CEO and physician Rushika Fernandopulle, build out the software platform it uses at its clinics. Iora plans to double its operations from 11 locations nationally, and hopes to grow to a size where it can be sustainable on its own revenue, Fernandopulle said in a Jan. 26 telephone interview.
“This is a fundamental rethinking of how we deliver healthcare,” Fernandopulle said. “We think there’s a role to build a big, game-changing company. Everyone we signed up for this knows this not a quick, two-year sale.”
The $28 million came from new investors Foundation Medical Partners, Rice Management Company, GE Ventures, and Khosla Ventures, as well as existing backers .406 Ventures, Fidelity Biosciences, and Polaris Ventures.
Understanding the business model of Iora requires a bit of a philosophical approach: The company is trying to limit healthcare costs by encouraging greater use of primary care. Iora clinics seek to spend more time with patients than traditional primary care, using a team of doctors, nurses, and health coaches, as well as the software, to help track patients’ health.
Iora’s software helps the employees of clinics know when to reach out to patients who may need care. One simple example of how the software operates, Fernandopulle said: It has a “worry system.” Data that is logged about a patient, such as information from a clinical visit or a medical claim, is used to compute a worry score, which tells an employee at the clinic whether a patient may be in need of a check up. The employee will then call to encourage the patient to come in for the visit.
That’s where there’s another difference in Iora clinics compared with traditional practices, Fernandopulle said. Most patients don’t pay extra for more visits. Iora builds clinics where it secures deals with sponsors, such as employers, who pay Iora a flat monthly fee rather than a fee-for-service. When a sponsor, such as Dartmouth College in Hanover, NH, covers the per person monthly fee, the patients don’t pay anything and can visit the clinic as much as they want, according to spokeswoman Kathleen Haley
(Four of the Iora clinics in Washington and Arizona do require a co-pay because of federal regulations, Haley said.)
“Our goal is to take care of populations and keep them healthy and out of trouble,” Fernandopulle said. “It leads to much better patient experience, much better clinical outcomes.”
The software platform is currently being used in the clinics Iora operates in six states, Fernandopulle said. The companh’s new funding will help it improve the system as it grows in its current and new markets, he said. Iora already updates the platform about every two weeks, he said.
“What we’re building is a new operating system for healthcare,” Fernandopulle said. “It uses a tight linkage between the data system and the people.”