The company raised $100 million in the initial Series C tranch in AprilRead more...
The company currently partners with Aetna, Cigna, United, Oxford, and Oscar
COVID has really done a number on the nation's already ongoing mental health crisis: over 40 percent of respondents to a survey in June "reported at least one adverse mental or behavioral health condition," including anxiety and depression, according to the CDC. Yet, actually getting insurance to cover mental health services is still difficult, despite legislation from congress, as well as provisions in the Affordable Care Act, which require insurance companies to cover mental health.
That is the problem that Headway is solving: the company not only matches patients with therapists, but it also uses its software to help those therapists accept insurance from those patients.
Headway is "building the first national network of therapists who accept insurance," Andrew Adams, the company's co-Founder and CEO, wrote in a blog post on Wednesday which announced a $26 million Series A funding round.
In the post, he noted that 70 percent of therapists don't accept insurance, mostly due to the cost and the difficulty of providing coverage.
"The reality is that therapists would accept insurance if it weren’t so hard. But it is hard, because insurance wasn’t built for therapists. It was built for huge hospital systems who employ entire departments to deal with the administrative burden of insurance. As individual practitioners, therapists don’t have the bandwidth to support taking insurance," he wrote.
Headway's software does the work of handling insurance for the therapist: all they have to do is speak with one of Headway's Therapist Advocates to see if their practice is a good fit, after which they fill out a form online with the basic information needed to get them set up with insurance.
Within just one or two months, Headway will allow therapists to take insurance from the companies it works with, including Aetna, Cigna, United, Oxford, and Oscar. Headway says that it anticipates working with Blue Cross Blue Shield soon as well.
"Because Headway’s free software for therapists handles all the work to accept insurance, two out of three providers that you’ll find on our platform don’t accept insurance anywhere else. Headway also enables anyone to find a provider who accepts their specific insurance plan. Put together, Headway is helping tens of thousands of patients who, like me in 2015, would otherwise be unable to find affordable mental healthcare," Adams wrote.
So far, Headway has facilitated over 160,000 appointments, has served nearly 14,000 patients and has almost 1,700 therapists and psychiatrists on its platform.
The new round of funding that the company raised was led by Thrive and GV, with participation from its existing investors at Accel, which led its seed round, as well as GFC and IA Ventures. The company, which received angel investment from the founders of healthcare companies such as One Medical, Flatiron Health, and Clover Health, brought its total funding to $32 million.
"We’re eager to use this capital and support to build out our vision of a new mental healthcare system rewired for access and affordability," wrote Adams.
Investments into the mental health space
Perhaps not surprisingly given how badly people are suffering thanks to COVID, and its residual effects, funding into the mental health space outpaced all of 2019 in just the first three quarters of this year.
So far, in 2020, there has been $1.37 billion invested, compared to $1.06 billion invested in 2019.
That includes Amwell, which expanded into the mental health space last year; the company raised $194 million in Series C funding across two tranches in May, which was followed by another $100 million investment in August from Google Cloud, a deal that also included a multi-year partnership. The company then raised $742 million in its September IPO. Other big rounds include a $100 million round for Mindstrong; Headspace, which raised $93 million; and Lyra Health, which raised $110 million in August.
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