Nirvana Health Raises $7.5M Seed Extension for Therapist Insurance Navigation

Mental Health Tech Sees Investment as Insurance Billing Remains Complex

Despite significant investment flowing into the mental health technology sector, the intricacies of insurance billing persist. Now, even this historically cumbersome process is attracting attention from startups.

These companies are focused on streamlining the billing experience – from identifying errors in submitted claims to simplifying the filing process itself.

Nirvana Health Secures Seed Extension

Nirvana Health is developing a software platform designed to simplify mental health insurance claim submissions. The company recently announced a $7.5 million seed extension, increasing its total funding to approximately $12 million.

Established in 2020, Nirvana Health functions as a personalized clearinghouse. It files insurance claims for therapists and actively pursues payment on their behalf.

Furthermore, the platform can file claims directly for individuals undergoing therapy, provided they possess out-of-network benefits with a supported insurer and collaborate with a therapist utilizing the Nirvana system.

Currently, Nirvana Health integrates with major insurance providers, including Cigna, Aetna, United, and Anthem.

Expanding Beyond Claims Filing

With this new funding, co-founder and CEO Akshay Venkitasubramanian envisions Nirvana Health evolving into a strategic partner for therapists.

“We aim to streamline and centralize insurance operations for therapists,” Venkitasubramanian explained to TechCrunch. “We function as a financial partner, assisting them with critical decisions.”

These decisions include evaluating client sources and assessing the value of platform memberships.

The Cost of Insurance Complexity

The seed extension was spearheaded by Inspired Capital, with participation from existing investors Eniac Ventures, RTP Seed, and Arc Ventures.

Across the broader healthcare landscape, insurance complexity contributes substantially to wasteful medical spending in the U.S. An estimate published in JAMA in 2019 suggests approximately $300 billion is lost annually due to complicated medical billing.

Out-of-Network Challenges in Mental Health

In the mental health sector, out-of-network coverage significantly exacerbates this complexity. A 2019 report from the Mental Health Treatment and Research Institute indicated that mental health visits are 5.4 times more likely to be out-of-network compared to primary care visits.

Even when in-network, mental health services are often treated as a carve-out, meaning therapists may need to bill a separate entity even if they accept a patient’s primary insurance.

Venkitasubramanian believes these challenges present a unique opportunity for technological solutions. Technology can help navigate existing systems, even if they aren’t inherently intuitive.

“Technology should be able to interpret an insurance card and determine the correct billing procedures for mental health services,” he stated. “We’ve developed the logic to automate claim filing, ensuring accurate routing and faster payment.”

Preparing for Increased Complexity

Nirvana Health anticipates that the situation will become more complex before it improves. The proliferation of teletherapy platforms is leaving therapists struggling to determine which services best suit their needs and how to manage billing across multiple platforms.

“Currently, few platforms address the implications of this new landscape for therapists, considering their revenue goals and helping them evaluate opportunities,” Venkitasubramanian noted.

“We aim to fill that gap by providing guidance and support.”

Investment Trends in Mental Health

A Silicon Valley Bank Q3 trends report forecasts that investment in mental health services will exceed $3 billion this year. The report highlights a growing focus on enterprise-facing companies, including employers, payers, and providers.

Nirvana Health is already collaborating with major telehealth providers offering services across state lines. The software integrates with Headspace Health, formed through the merger of Headspace and Ginger.

A Supply-Side Approach with Consumer Benefits

Venkitasubramanian positions Nirvana Health as a supply-side business, but the company is also extending benefits to consumers.

This week, Nirvana Health is launching a tool that allows therapists to calculate session costs with insurance, and is now making this functionality available directly to patients.

Patients can now use the tool to estimate the cost of visits and identify potential therapists within their network.

This isn’t a signal of a fully consumer-facing product, but rather a “PSA” highlighting the increasing complexity of the insurance landscape and the role technology can play in navigating it.