JPMorgan unit backs Centivo's $75 million equity and debt raise By Reuters
Written by Manya Saini
(Reuters) – Healthcare company Centivo said on Tuesday it has secured $75 million in equity and debt financing, backed by Cone Health Ventures and the largest U.S. bank JPMorgan Chase's (NYSE: ) Morgan Health unit.
The company did not disclose the amount of the new raise.
Centivo offers a health plan focused on primary care as one of the most common US insurance companies, which is one of the most expensive health care plans in the world. Despite having insurance, medical services are out of reach for many, especially those with low to moderate incomes, due to high deductibles and out-of-pocket costs.
“Our biggest competitors are the big insurance companies,” Centivo CEO Ashok Subramanian told Reuters. “We've successfully reduced employee out-of-pocket costs by approximately $1,200 per year.”
Out-of-pocket costs refer to the costs people incur for health care services, even if they have insurance.
The company said it has reduced members' out-of-pocket costs by 71% by 2023, compared to the replacement plans. This change also resulted in savings for employers of 15% or more.
The company intends to use the new capital to develop and expand its product technology and start new partnerships.
“We will continue to grow our network of strategic relationships with leading health systems to achieve integrated, integrated care and cost transparency for our members,” Centivo CEO Ashok Subramanian told Reuters.
Other investors include MemorialCare Innovation Fund, B Capital, Cox Enterprises, F-Prime Capital, and Ingleside Investors.
“JPMorgan Chase, along with other employers, are looking for opportunities to strengthen their contributions to the health and welfare of employees without increasing costs,” Peter Scher, vice chairman, JPMorgan Chase and a member of the board of Centivo told Reuters.
The credit facility for the promotion was provided by the credit company Trinity Capital and JPMorgan Chase.
(This story has been refiled to remove the word 'Partners' from F-Prime Capital's name, in section 9)
