LEXINGTON, MA --Oct. 16, 2001 If it feels like an economic recession to some of us, it sure doesn't for the people at eHealthDirect, Inc. The developer of an Internet-based health plan administration platform, the company recently announced it has secured $43.8 million in second-round financing. The announcement constitutes the largest venture capital financing this year in the e-health field, and the second largest non-biotechnology round in the healthcare industry overall, according to Venture Wire.
In other major changes for the company, it also introduced its new corporate name, deNovis, Inc. "This round of funding is a testament to our investors' confidence, and along with our name change, it marks an exciting new stage in our company as we transition into full-scale operations," said deNovis CEO Tuan Ha-Ngoc. "We look forward to delivering on our promise to reinvent healthcare administration."
Led by 3i, an international venture capital company, the size of the round is especially impressive coming at a time when capital investment in the technology sector has slowed. "deNovis is tackling a primary challenge in America today - their platform will be the most significant technical breakthrough in the healthcare technology sector in years," said William J. Oliver of 3i. "Our investment in deNovis demonstrates our strong belief in the company and its management team." First-round investors Advanced Technology Ventures, Audax Ventures, Bain Capital Partners, J.P. Morgan Partners, Psilos and Utah Ventures also participated in the latest round.
"We offer our health plan customers an unprecedented opportunity to reduce administrative costs while providing new opportunities for business growth and improved customer service," said deNovis Chairman Jerilyn Asher. "The public is demanding change in the healthcare industry, and these synergies will benefit health plans, members, providers, employers and government healthcare agencies alike."
The goal of the deNovis system is to enable health plans to dramatically reduce the time currently spent processing claims and other core transactions; quickly introduce new, customized products to market; and provide members and physicians with information about benefits and contracts in plain, easy-to-comprehend language. The platform, which is HIPAA compliant and delivered 24X7 on an ASP basis, will also include a high-performance, active data warehouse that will store and instantly update all data generated in the health insurance process.
The idea is catching on, too. According to deNovis, as of October 1, Tufts Health Plan announced they became the second insurer to embrace the deNovis model, joining California-based Health Net, Inc., which signed on in May. "This new technology will enable the plan to move towards a new level of service - one where transactions will be paperless and instantaneous," says Dr. Harris Berman, chief executive of Tufts Health Plan. "We believe the collaboration with eHD will set a whole new standard for processing health insurance transactions."
