Sword Health, a company that provides virtual physical therapy and mental health, is now offering AI care manager agents for payers and providers to tackle operational and administrative tasks.
The new AI division marks a notable expansion from the company's core business of virtual care services like digital musculoskeletal care, pelvic health and movement health.
The launch of the new division, called Sword Intelligence, marks a "pivotal evolution" in Sword Health’s strategy, according to the company.
"Sword Intelligence allows us to move beyond delivering care to our own members to enabling the entire healthcare industry to scale it efficiently and effectively," Virgilio "V" Bento, founder and CEO of Sword Health, told Fierce Healthcare when reached via email.
"At Sword Health, we talk about our mission as making world-class care as accessible as running water. And we often say we’re only 5% done. Looking at the opportunity ahead—moving healthcare from a model that relies 100% on human labor to one where AI takes on a central role—that statement has never felt more true," he added.
Sword Health's AI solutions have been "battle tested" through its own internal operations, executives said. The 10-year-old company built AI care manager agents to streamline its internal non-clinical workflows such as enrollment, triage, eligibility checks and high-risk member outreach. These tools also help the company efficiently manage care for half a million members.
“Sword Intelligence began as an internal initiative to address Sword Health’s own operational challenges in delivering care more efficiently,” Bento said.
"We have more than 600,000 patient members. This requires managing and coordinating care for all of those members across multiple programs, referrals and customer support. These non-clinical tasks are labor-intensive and very hard to scale using humans. We quickly realized that a new, better solution was needed if we wanted to keep scaling efficiently without breaking apart," Bento told Fierce Healthcare.
"Then we realized that some of the companies in the healthcare world - either payers, providers, or governments - have the same challenge as we did. Demand for healthcare is increasing, but the ability to serve that demand is not keeping pace," he added.
The company is now making these AI capabilities available to external organizations. The AI solutions can automate non-clinical workflows for appointment management, patient triage and intake, discharge planning and referrals.
With modular AI care managers that integrate with existing human teams and infrastructure, Sword Intelligence offers a flexible path to scale care while improving efficiency and reducing costs, executives attest.
As a digital health company, Sword Health initially focused on virtual musculoskeletal care and then expanded into pelvic health and movement health. The company broadened its reach into mental health with an artificial-intelligence-driven care model that it unveiled in June, along with a $40 million funding round. It banked a $130 million financing round a year prior, in June 2024.
Sword, which now has a valuation of $4 billion, works with more than 1,000 enterprise clients. Sword Health claims that since 2020, more than 600,000 members across three continents have completed 7 million AI sessions. The company says its virtual care solutions have saved its clients nearly $1 billion in unnecessary healthcare costs. Further, Sword Health says its outcomes, including medical cost savings, reduction in MSK pain and improved productivity, are backed by more than 40 clinical studies.
Last year, it rolled out its latest tech update, called Phoenix, that combines AI and human clinicians to guide and react to members during their sessions through natural conversation. The company will continue to use Phoenix to support patients directly, executives said.
Sword Intelligence offers new set of agents specialized in care management, built to streamline the coordination of care.
Sword Intelligence operates more like a startup within the company, run with its own dedicated team, roadmap and go-to-market strategy to target areas of healthcare beyond Sword Health's traditional focus on digital physical therapy, the company said.
The company's AI solutions are modular, safety-first, and designed to integrate seamlessly into existing systems and workflows. The solutions meet HIPAA, HITRUST, and SOC 2 standards, the company said.
AI agents for healthcare is a hot area for innovation and there's a growing list of companies and startups offering AI tools to tackle administrative tasks. Bento asserts that Sword Health offers a distinct advantage with its real-world experience in healthcare.
"The space is indeed crowded with vendors who either understand AI but not healthcare, or know healthcare but lack deep AI expertise. Sword Health is uniquely positioned because for years, we’ve been testing the right approach to AI in healthcare with our own members; learning day in and day out how to engage patients, coordinate care, and navigate complex healthcare workflows," he said.
"Instead of building a simple point solution and rushing it to market, we’ve developed our AI iteratively through actual patient care. Now we bring this same approach to prospective clients, asking 'How can we build solutions that truly work within your specific workflows and care processes?'"
Bento also noted that Sword Health's AI solutions are not off-the-shelf. "While we have proven solutions we can deploy quickly, our engineering teams work side-by-side with clients, embedding in their offices and tailoring solutions to integrate seamlessly into their workflows. We want governments and payers to approach us saying, 'We have this problem that isn't scalable—can you help?' Then we partner together to develop bespoke solutions that address their specific needs. That's how we ensure the AI doesn't just work in theory—it works for them, from day one," he said.
As the digital health IPO market begins to warm up, with competitor Hinge Health and Omada Health both successfully going public this year, many industry watchers have Sword Health on their short list of companies that could go public in 2025.
Last year, when asked about plans to go public, Bento said the company "has been thinking about" an IPO but doesn't have a specific date in mind.
"It will not happen before the second half of 2025," he said in an interview a year ago.