ClarityCare Raises $16.5M to Speed Up Prior Authorizations 

As health plans grapple with new federal deadlines for prior authorization decisions, healthcare AI startup ClarityCare has raised $16.5 million to automate the administrative workload that can keep patients waiting for the care they need. 

The San Francisco-based company announced Tuesday that its oversubscribed Series A funding was led by global venture capital firm Headline. ClarityCare’s funding now totals $19.8 million. The company plans to use the money to expand its sales and engineering team, develop new products, and grow its presence in the healthcare market, particularly in the government sector. 

The funding comes as payers work to comply with CMS-0057-F, a January 2026 rule from the Centers for Medicare and Medicaid Services and payers have until January 1, 2027 to meet the requirements. The rule was designed to improve electronic health information exchange and streamline the often-tedious prior authorization process. The rule established a prior authorization decision timeframe of 72 hours for expedited requests, and seven days for standard requests. 

“Medicaid and Medicare Advantage plans face the most pressure from the new CMS rules,” said ClarityCare CEO Hermine Tranie in an email. “We’re continuing to grow with commercial plans as well across medical management and cost containment operations.” 

Prior authorization requires health plans to determine whether a treatment or procedure prescribed by a healthcare provider meets coverage criteria. Before treatment can be delivered to the patient, medical staff must spend copious time – according to one report from the American Medical Association (AMA), up to two business days per week, per clinic – gathering medical records data, checking plan-specific eligibility and policies, and filing paperwork. The AMA calls the prior authorization process “…overused, costly, inefficient, opaque and responsible for patient care delays”, and calls for the promotion of prior authorization automation, among other interventions, to ensure timely care for patients.

The timeframes imposed by the new federal rule have added urgency to the process. Hitting those targets remains an operational challenge for health systems and payers as they face growing workloads and limited staffing.

ClarityCare hopes to bridge that gap with its AI agent, Electra, which is built to streamline the prior authorization process. The company announced Electra’s early success: for one of its seven current customers, the system, which can approve and escalate requests but will never issue denials, cut prior authorization waits from 12 days to two. Across their customer base, the impact reaches workflows that affect care for 6 million people. 

These customers include health plans, third-party administrators (TPAs), medical management companies, and government health services organizations supporting Medicaid and Medicare programs. They are based across the country. 

The tool — with the AI agent Electra — includes a human-in-the-loop to avoid erroneous prior authorization decisions. Tranie explains that the prior authorization process has three parts: the administrative work to assemble the case, the clinical review, and closing the case post-decision. 

“Existing tools address one slice: rules-based auto-approval clears simple procedure codes, and summarization condenses records once someone has collected them,” said Tranie in an email. “Electra connects all three, automating the administrative work wherever possible, strengthening the clinician’s review with summaries, recommendations and drafted communications, and completing the paperwork once the decision is made by the clinician. Turnaround only improves when no step is left waiting on another.”

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