Mental health company Headway has raised $100 million in Series D funding, which it will use to expand to Medicare Advantage and Medicaid beneficiaries, the company announced Tuesday.
New York City-based Headway makes it easier for mental health clinicians to accept patients through insurance by helping them with credentialing, onboarding, clinical training, scheduling, billing and other services. Through Headway’s platform, patients are able to search for mental health providers by location, concern and insurance carrier, and schedule an appointment within 48 hours. The company has 34,000 providers and is in network with more than 40 commercial health plans across the U.S.
The $100 million Series D funding round was led by Spark Capital and included participation from Thrive Capital, Accel, a16z and Forerunner Ventures. In total, Headway has raised more than $325 million, according to Crunchbase. The Series D round brings the company’s value to $2.3 billion.
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Headway simplifies the process for accessing mental health care, according to Will Reed, general partner at Spark Capital and Headway board member.
“Headway is quickly becoming the centralized platform for mental health care access and delivery,” Reed said in a statement. “The company is uniquely positioned to bring together providers, patients and payers and unite a fragmented system, and Spark Capital is excited to further support its mission and growth.”
The company will use the funding for its planned expansion into Medicare Advantage and Medicaid. Headway has already started working with Medicare Advantage plans in some states, and anticipates expanding to 51 markets by the end of 2024. It will start working with Medicaid in 2025.
“There is a rampant need for increased access to mental health care services among these populations, and our community of clinicians overwhelmingly want to fill the gaps,” said Olivia Davis, chief commercial officer of Headway, in an email. “When we surveyed providers on our platform last year about this topic, they said that the number one reason they took insurance was to ‘provide access to care for those that may not be able to afford private pay services.’ Headway is building the nuanced products and programs required to enable clinicians to accept patients from these plans.”
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Medicare Advantage and Medicaid together cover almost one-third of Americans. They often have greater healthcare needs but encounter additional obstacles to receiving care. Despite one in three Medicaid beneficiaries and one in four Medicare beneficiaries living with a mental illness, accessing mental health services remains challenging due to a severe shortage of providers, according to a March 2024 report from the U.S. Department of Health and Human Services.
“This is because government programs have an additional layer of operational burden, such as more complex credentialing processes and stricter compliance requirements [for providers], when compared to commercial plans,” Davis said. “We’re investing in the technology to relieve this operational and administrative burden, and ultimately make it easy for clinicians to deliver care to these patients.”
Other companies that connect patients to mental health providers include Alma and Grow Therapy, the latter of which recently raised $88 million in Series C funding.
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