New Startup Launches to Reduce Medical Practices’ HR Burden

Stitch PEO — a startup built at Redesign Health — officially launched and announced that it has raised $8.75 million in seed funding. The company is a professional employer organization for independent medical practices, designed to improve recruiting, hiring, onboarding, and other human resources processes.

More than 50 healthcare startups have been built at Redesign Health since it was founded in 2018. Several of these startups have been launched this year, including Valendo Health, a value-based endocrinology company, and Beanstalk Benefits, a platform that allows employees to build their own benefits. 

On Monday, another startup built at Redesign — called Stitch PEO — announced its launch, along with $8.75 million raised in seed funding. The San Francisco-based company is a professional employer organization for independent medical practices, designed to improve recruiting, hiring, onboarding, and other essential human resources processes.

Independent medical groups are facing a complex set of challenges, pointed out Stitch CEO Rajesh Voddiraj. 

“Small and medium-sized practices struggle to compete in the recruitment landscape, provide essential training and certification, and offer benefits that ensure staff feel secure and focused on patient care. Despite their critical role in the healthcare system, independent practices lack the infrastructure, resources and scale to manage employee benefits and HR functions efficiently,” he explained.

This means that physicians have to shoulder the burden of cumbersome and costly employer responsibilities, such as compliance with regulations, benefits administration, payroll and HR management. 

Stitch seeks to improve the way independent medical groups manage their workforce by providing a comprehensive HR platform tailored specifically to their needs, Voddiraj declared.

“Stitch’s platform addresses the HR, payroll and benefits management needs of small and medium-sized healthcare practices, automating routine tasks and reducing administrative burden,” he said. “By using a co-employment model, Stitch pools employees from various practices to create and negotiate the best possible benefits — including health, dental, vision, life, disability, 401(K) and various other benefits.”

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The platform also offers customizable dashboards and advanced recruiting tools, Voddiraj added. He noted that his startup’s tools are designed to be scalable and easily tailored to each practice’s needs.

In his view, Stitch’s platform optimizes the entire employee life cycle — from attracting and hiring talent, to onboarding and managing the current workforce, to conducting offboarding efficiently. 

“Our platform enables a client to manage the hiring process, including job postings to various job boards, manage applications, and provide data-driven insights into salary ranges, helping practices attract and retain top talent. Automated onboarding ensures new hires complete their new hire paperwork including benefits enrollment but also mandatory training on essential topics like HIPAA and EMR before starting their roles,” Voddiraj explained.

He noted that the platform also continuously monitors healthcare regulations and provides system updates to ensure compliance.

The fact that Stitch’s platform is built purely for healthcare practices is what sets it apart from large professional employer organizations like Insperity, ADP TotalSource and Rippling, Voddiraj pointed out. 

“Unlike general PEOs, Stitch understands the detailed requirements of healthcare roles, from credentialing to compliance. This industry-specific focus allows Stitch to offer tailored services, such as healthcare-specific training and malpractice insurance, which are not typically provided by other PEOs,” he declared.

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