PayZen has successfully raised $232 million to enhance its AI-driven healthcare affordability program.

This Series B funding, spearheaded by NEA and announced on August 13, comprises $32 million in equity and a substantial $200 million credit warehouse.

“This latest round is a pivotal step in our mission to eliminate financial barriers to healthcare for patients,” stated Itzik Cohen, co-founder and CEO of PayZen, in a news release. “We are grateful to have partners among our investors and health systems network who share our vision for the future. This milestone, marked by a highly competitive and oversubscribed round, positions us to further refine our platform and effectively bridge the financial gap in healthcare.”

PayZen leverages advanced technologies like artificial intelligence (AI) and machine learning to streamline the patient payment process for health systems, making it easier for patients to access and afford their care.

Over the past two years, the company has reported a remarkable six-fold growth, achieving 100% customer retention and 132% net retention. PayZen had previously raised another $200 million in the fall of 2022.

As part of this funding round, Mohamad Makhzoumi, co-CEO at NEA, will join PayZen’s board. Makhzoumi brings over two decades of experience at NEA, collaborating with healthcare startups at various stages of development.

“Healthcare affordability is a significant challenge for both patients and providers in the U.S.,” Makhzoumi remarked. “We believe PayZen’s AI-enabled platform is a leader in its category, as demonstrated by the company’s explosive growth over the past year and its potential to disrupt a historically challenging market.”

PayZen’s funding arrives at a crucial time when AI is poised to transform the health insurance industry, potentially reducing costs and increasing revenues for payers facing economic pressures,” PYMNTS reported last month.

With insurers confronting rising medical service usage and provider costs, along with tightening Medicare Advantage reimbursements, AI and automation technologies may offer solutions to enhance efficiency and profitability.

Moreover, an increasing number of doctors are utilizing AI chatbots to draft letters to insurers in seconds, expediting the approval process for costly claims and achieving in minutes what previously took years of advocacy.

“This technological shift occurs as major insurance companies face class-action lawsuits for allegedly using their technology to quickly deny large batches of claims,” PYMNTS noted. “Experts caution that this could lead to an AI-driven ‘arms race’ in the prior authorization process, where bots compete against each other for insurance coverage.”