Founder Pooja Ika says the goal has always been to build a sustainable business model.
eternalHealth, a Medicare Advantage health plan, founded and run by Indian American entrepreneur Pooja Ika, has raised another $10 million in Series A funding to build a sustainable business doing things the right way.
This additional financing follows an initial $10 million in seed and pre-Series A investment by successful healthcare and tech entrepreneurs last summer in the first new health plan to be approved in Massachusetts since 2013, the company announced Tuesday.
Ika, the first woman at the age of 24 to launch a new Medicare Advantage Health Plan in the US, said the Series A funding, which includes seed investors and additional successful technology and healthcare entrepreneurs, will be used to support the day-to-day operations.
It will also help attract and retain membership, while most of the capital will be used as risk-based capital to support the company’s membership growth, she said.
Typically, the launch of a new health plan takes two to three years and costs tens of millions of dollars, said Ika. “At eternalHealth, we accomplished this historic goal within a year.”
“The initial seed round helped us build a technology-powered infrastructure, optimize our operations, and hire a skilled team of 20 professionals,” added Ika.
“Now, that we are operationally sound, we are actively trying to grow and increase our membership base,” she said. “The goal has always been to build a sustainable business model, that is committed to doing things the right way.”
New insurers have raised hundreds of millions of dollars at the same stage eternalHealth is at now, but Ika is very mindful about raising capital, according to the release.
“It is not because we cannot raise the capital, it is because we are being intentional with our use of capital,” she said. “I strive to achieve the same results of some of my mentors who have started successful health plans across the country.
“Their advice to me was to get all of our regulatory approvals with as little capital as possible, and that is exactly what we did.”
Ika said that this is the first time ever that a health plan has been launched in the United States by a woman at 24 and not only that, but by a woman of color.
“Navigating through the healthcare system can be complicated, and insurance companies are not always the best at helping beneficiaries navigate through it,” she said.
Headquartered in Boston “eternalHealth is committed to empowering and educating our members so that they make informed decisions and take their care into their own hands,” Ika said.
“By educating our members, establishing collaborative relationships with the providers and health systems in our network, and using the latest technology and tools, we can deliver higher quality care at a lower cost to our members.”
John Sculley, former Apple CEO and an investor and shareholder in eternalHealth, is involved in the Series A funding round and believes in the mission of eternalHealth, according to the release.
“Around two decades ago, I decided I wanted to disrupt the healthcare industry by collaborating with entrepreneurs who believed in their mission,” he said.
“I truly believe we have a healthcare Moonshot with eternalHealth and I am excited to see how we can better the space together,” Sculley said. “I believe in Pooja’s mission and with the help of her team, she has been able to accomplish so much in one year.”
eternalHealth believes that through their partnership with Red Sox legend David Ortiz, popularly known as Big Papi, Massachusetts residents will be able to connect David’s trustworthy and kind personality to eternalHealth’s commitment to offering high quality, affordable products, while acting as a trustworthy and transparent partner to its members, the release said.
Through its technology-driven, innovative platform, eternalHealth is looking to substantially reduce its administrative & operating costs (SG&A) across the entire enterprise, it said.
The cost savings will allow for more dollars to be allocated towards the total cost of care, while also passing down the savings to their members through its robust benefits to lead them in the healthy direction, the release added.
Once eternalHealth reaches the critical membership threshold, it will implement value-based contracting with providers, through which they will collaborate with providers and help them manage the overall quality of care for their patients through platform driven intelligence, improve the overall quality of life, and reduce healthcare costs.
“At eternalHealth, we believe we can really reduce healthcare costs by leveraging the right technology. That helps with member retention and satisfaction, which remains a key priority for eternalHealth,” said Ika.
“Just because it has not been done before, that does not mean it is impossible,” she said. “eternalHealth strives to be a catalyst for change in a market that has seen little disruption.”