Startups

Honor raises $50M to expand caregiver support as CMS adds flexibility for home care services coverage (Updated)

Honor's fundraise paves the way for further expansion following a decision by the Centers for Medicare and Medicaid Services to enable Medicare Advantage plans to cover non-medical home care services as a supplemental benefit starting in 2019.

Note: This post has been updated with comments from Honor President Nita Sommers

Honor, a digital health startup that provides a set of tools to help partner organizations provide caregiver support at clients’ homes, has a closed a $50 million Series C round to support its expansion in California, Texas and New Mexico. The funding will be used to extend its partner network, Honor President Nita Sommers said in a phone interview.

“We’re taking our technology and operational capabilities and making it available to select partners,” Sommers said. “We are going to companies and providing our technology to them for workforce management and recruiting.

She broke down Honors partners into three categories: home health agencies and provider networks; local hospitals, payers, and Medicare Advantage plans; and innovative technology companies that provide opportunities to pair Honor’s services. One example from this third group is how to bring a greater level of visibility to adult children using caregivers to look after parents remotely, such as providing a better understanding of their diet and pain levels. Another example of how it is working with some of these partners is to add a level of transparency to care coordination — what’s happening to patients once they leave the hospital? Are they taking their medications and sticking to their care plan? Honor is working with companies developing in-home sensors and devices and sees a lot of potential for these businesses over the next five to 10 years.

Sommers, who joined Honor in 2017 from Castlight Health where she served as Chief Strategy Officer, said that in the past year Honor has shifted away from providing a caregiver-on-demand service and evolved into one that supports home healthcare providers. The home health industry is experiencing a staff shortage which will continue to grow as the Baby Boomer generation continues to advance in age. Trump’s tough stance on immigration has exacerbated the staffing challenges in the sector.

Naspers Ventures led the funding round, with participation from existing investors. Some of those investors include Thrive Capital, whose managing partner and co-founder, Joshua Kushner, also co-founded health insurance startup Oscar, 8VCAndreessen Horowitz, and Syno Capital. To date, Honor has raised $115 million, according to a company news release.
The new development follows the decision in April by the Centers for Medicare and Medicaid Services that Medicare Advantage plans will be able to cover non-medical home care services as a supplemental benefit starting in 2019.

The company’s network currently includes 13 cities, according to Honor’s website. Although a collaboration with Walmart announced two years ago went no further than the pilot stage, the business has expanded its business beyond Dallas to include Arlington, North Richland Hills, and Plano. Most recently, the company has added Albuquerque. In California, Honor has a presence in Los Angeles, Long Beach, Pasadena, San Francisco, Oakland, San Jose, Palo Alto, and Concord. Looking ahead to the next 12 months, Sommers said the company plans to expand in California and Texas to cities such as San Diego, Sacramento, Houston, and Austin.

In recent years the company has refined the services it offers, adding a “wellness check” app in 2016 as a way to help caregivers establish a baseline for their clients, as a way to determine whether clients were active, eating, drinking or sleeping less or more than usual. The goal is to spot problems earlier to avoid the need for an emergency room visit or hospitalization. Among the conditions Honor’s technology is designed to support include cancer, Alzheimer’s disease, Parkinson’s disease, dementia, COPD, heart disease, diabetes, and multiple sclerosis.

Honor is not the only startup supporting home health caregivers, but its experience highlights some of the opportunities and challenges of scaling in this subsector of digital health. Other companies include New York-based Hometeam, which appointed new CEO Randy Klein from Remedy Partners this week, and Toronto-based Mavencare.

Photo: Getty Images

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