Garner Health, a digital care navigation company for employers, pocketed $118 million in series D funding to build out its doctor ranking platform.
Founded in 2019, Garner uses data analytics and artificial intelligence to help employers and employees identify high-quality, cost-effective healthcare providers and then creates financial incentives for patients to see those doctors.
Kleiner Perkins led the startup's series D round, with Redpoint, Maverick, Kaiser Permanente Ventures, Mercy, Plus Capital and other existing investors also participating. Garner Health has raised $200 million to date. The series D round boosts the company's valuation to $1.35 billion, according to executives.
Garner's clients currently include 700 organizations, including some of the largest employers, health plans and providers in the country, reaching 2.5 million members. The startup says its revenue grew 130% year over year as employers continue to look for alternatives to traditional provider search tools.
Garner plans to use the fresh capital to expand its doctor ranking platform, scale its AI-driven navigation and appointment booking capabilities and grow its team.
Nick Reber, founder and CEO of Garner Health, said the company is addressing a fundamental market failure in the healthcare industry: a lack of transparent data on physician quality and a lack of incentives for patients to seek high-performing providers.
"The single most important health decision we make is which individual doctor we see when we need care," Reber said in a statement. "Our data shows that the top-performing doctors have 75% lower rates of complications and mortality than their peers. By identifying these providers and creating the financial incentives for patients to see them, we aren't just saving money—we're fundamentally re-engineering the healthcare marketplace to reward quality."
The startup uses deidentified data from a massive dataset—more than 60 billion medical records from 320 million patients—to evaluate which doctors have the best outcomes and lowest costs. As part of its evaluation, Garner identifies doctors who follow the latest research, avoid unnecessary procedures and help patients get healthy faster.
Garner's algorithm ranks doctors using 700 metrics, showing significant variations in outcomes and costs, Reber told Fierce Healthcare's senior writer Anastassia Gliadkovskaya in a "Podnosis" interview last month.
"We use these longitudinal patient records to know every individual thing about a doctor. So we have over now 700 individual metrics that measure everything from: When you walk in, did that provider bill your first office visit fairly? Do they give you all the screenings you need, not the ones you don't? Where do they send your screenings? How much does that cost? Do they give you the right surgery at the right time? Do they accurately diagnose you? Where do they do this surgery? What's the complication?" Reber said on the podcast episode.
Garner breaks down these data into several categories that evaluate guideline and clinical protocol adherence and health outcomes including complications, revisions and disease progression.
"The third [category] is more structural efficiency metrics, so using the right appropriate site of service, putting you on a generic drug. We find in almost every market, you can get to the highest quality while meaningfully lowering costs by about 25%," Reber said.
Beyond just offering transparency tools, the company also aims to drive employee engagement and change patient behavior by offering smarter financial incentives.
When employees use Garner to find a top provider, their employer covers all or most out-of-pocket costs including deductibles and co-pays. The result, according to Garner executives, is that employees pay on average 80% less out-of-pocket to see the best doctors, while employers see an average 12% reduction in total healthcare spend in the first year alone.
"We know that every time a member uses our recommendation, the total claims cost is 25% lower, which is about $7,000 or $8,000, and so what we do is we take some of that money and basically share it back with the employee and cover their co-pays, deductibles and coinsurance bills, but only for that episode of care, and only if they engage," Reber told Gliadkovskaya last month. "It basically gives the employees an incredibly rich benefit if they engage and do the right thing, and if not, then they keep their Cigna, Aetna, United, Blue Cross, broad network. We think that's a really compelling trade. We get about half of all of the members to actually go where we want and engage, which is about 10 times higher than you get with a standard navigation product."
Employers can keep their network carrier. Garner acts as a financial administrator that layers on top of existing health plans.
"It's pretty seamless to just make the program work, and basically all we have to work on is educating their employees, getting into their benefits administration or open enrollment meetings and making sure their employees really understand that Garner is your new provider directory and how you're going to search and find care," Reber said.
The company raised a $45 million series B round in 2021 led by Redpoint Ventures with participation from Founders Fund, Thrive Capital and Optum Ventures.
"Garner delivers a rare double win in healthcare: getting patients to the highest quality doctors while simultaneously cutting costs at scale," said Josh Coyne of Kleiner Perkins in a statement. "Already serving 2.5 million people, Garner is fundamentally reshaping the way Americans access healthcare."