Grand Rounds Raises $40 Million Series B For Web-Based Second Opinions

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San Francisco, Calif.-based digital health startup Grand Rounds announces a $40 million Series B, led by Greylock Partners, and with additional capital contributed from returning investors Venrock and Harrison Metal, which co-led its $10 million Series A in 2013.

Grand Rounds markets a benefits management platform to employers looking for outside help with reducing health care costs and improving employee health and wellness. The company counts Jamba Juice and Hightail among its list of customers, and provides medical support for over one million patients in total.

Grand Rounds’ primary service is providing second opinions and dedicated care coordination for employees facing complex medical cases. The cost savings comes from the premise that the sickest 10 percent of the employees account for nearly 70 percent of the company’s total annual health care spending.

Co-founder Lawrence Hoffman, MD, explains that inspiration to start the company came after his own eight-year old son spent months in the hospital and then a full year isolated in his home combating unexplained liver and bone marrow failures. Dr. Hoffman, himself a professor of interventional radiology, contacted the leading physicians in the country working on cases like his sons, and as a result was given access to unpublished, cutting edge clinical research findings that recommended an alternative treatment plan with measured higher outcomes for similar patients. The treatments worked, and as a result his son returned home and eventually made a full recovery. Soon after, Hoffman began work on Grand Rounds with the idea of building a web-based network of the worlds leading physicians, and then engaging them to oversee care delivery on complex medical cases for patients that might otherwise not receive the expertise they need to address their condition.

To address the needs of these patients, Grand Rounds recruits top-ranked US physicians from prestigious teaching hospitals, and then matches them with patient cases based on their specialty, publication subject matter history, and peer-verified areas of expertise. Once matched, the physician will review the patient’s medical record, confirm or dispute the local physicians primary diagnosis, and then write a personalized treatment plan based on their medical expertise. The service, Grand Rounds claims, has resulted in major changes to the diagnosis and subsequent treatment plan in 66 percent of the cases it has handled thus far.

Grand Rounds has also grown a national network of local providers, accepting only what it calls the “top three percent” of practicing physicians from across the country. These physicians are matched with patients based on their own areas of expertise, and are available to the patient for in-office appointments and care coordination throughout the treatment and rehabilitation process.

Last week, Grand Rounds announced a partnership with fellow San Francisco-based digital health company Castlight Health. Castlight markets its own employee health benefits management platform that strives to bring cost transparency into healthcare by presenting searchable lists of local physicians that accept the patients insurance carrier, and then sorting the list by quality data and average out of pocket expense. Grand Rounds will market its network of physicians on the platform to employers that use both services.

Grand Rounds will use its new funding to expand its sales and marketing team, enhance its mobile presence, and improve its case matching algorithms.


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