Apostrophe Health

The health plan that's fixing America

Our investment in Apostrophe Health

We are excited to announce that Matchstick Ventures Fund II has completed an investment in Apostrophe Intelligent Health Benefits (apostrophehealth.com).

Apostrophe Intelligent Health Benefits replace your current administrator and legacy provider network to deliver better benefits for less money to self-insured employers. Apostrophe is driven by simplicity, transparency and love to provide market-leading member care and put employers back in control of cost and experience.

Based in Denver, Colorado, Apostrophe is a Certified B Corporation and a 2019 Health Value Awards winner. For more information, visit www.apostrophe.health.


Company specifics

Company Specifics

Apostrophe Health is building a new healthcare plan which significantly reduces cost, provides better health service and simplifies the whole healthcare system. 

Apostrophe Health focuses on mid-size employers who self-fund their health insurance plans and replaces their existing third-party healthcare administrator (e.g. Cigna). Apostrophe Health gives each employee a cash pay debit card which they can use for their healthcare purchases. When an employee visits a doctor they pay for the service at the time of the visit or procedure using their card. The card is funded by the employer and the employee which encourages responsible behavior. Because the doctor is getting payment up-front they eliminate their collections risk and hours of administrative overhead so they offer an average of 20% below the lowest insurance rate for the service. 

Employers love this because they are saving over 20% on their healthcare expenses, have real time information on their healthcare usage, see pricing transparency and provide better healthcare. Employees love it because they can visit any doctor they want and never deal with a confusing bill again. And doctors love it because they reduce risk, overhead and get paid.

This may seem straightforward and easy, but it isn’t. Apostrophe uses predictive analytics, 3rd party digital health solutions, innovative billing and collections algorithms and many other technologies to power their platform, steer employees to better doctors who charge less and manage complex cash flows. In addition, Apostrophe Health combines massive amounts of data to price it’s insurance based on actual usage in real time. Apostrophe Health reinsures itself for catastrophic issues, just like existing providers.

Employers pay $40 per employee per month for Apostrophe’s service, similar to other providers. Apostrophe also earns 25% of the annual savings they generate. On average they make $350,000 per mid-size employer, of which there are 30,000 who self-fund their health insurance.

Apostrophe Health launched in 2017 with a paid pilot for a school district in Colorado. It generated over 20% savings in its first year. Since then they have rolled out to cover a few thousand lives and are expanding rapidly.

Cheryl Kellond (CEO), Kathy Keating (CTO) and Julia Hutchins (COO) are uniquely qualified to solve this problem. Cheryl is a multi-time entrepreneur who has delivered over $750M in revenue from version one products. Kathy is one of the most well respected tech leaders in the state of Colorado. Julia brings the healthcare industry experience as she was CEO of Colorado HealthOp, the largest insurance co-op in the state and grew it from scratch to 83k members in three years. 

Natty met Cheryl when she moved to Colorado and became a mentor in the Techstars Boulder program. After being a mentor for a few years, she asked if she could take her new company (Apostrophe Health) through the Techstars Boulder program and they were admitted into the program in 2017. We made this investment because we’ve seen the sophistication and depth of experience on the leadership team. We like moonshot companies like this where if (when!) it succeeds, it will completely change a valuable industry and make a difference to millions of people.

Natty Zola
October 26, 2018

Company details

Over a trillion dollars are wasted each year due to administrative waste in the healthcare system. For most employers, their second largest expense after salaries is healthcare, whose costs have been rising 5x the rate of inflation. Managing healthcare costs has become a significant issue for many companies. 

Much of these costs come from the administrative overhead of managing plans, negotiating rates, contracting with doctors, billing, non-payment, collections and more. 

In an effort to control some of these costs, many companies are choosing to self-fund their insurance plans, moving the financial burden of their employees healthcare directly to their balance sheet. Companies do this when they believe they will have lower costs not being included in pools or groups. Self-funding is a huge trend, with 80% of US employers with over 100 employees self-funding, including over 30,000 midsize companies, which cover 100M people. While self-funding can reduce actual medical expenses, it relies on the existing healthcare system, process and significant administrative costs.