Avelis Health

What do they actually do

Avelis Health audits medical claims for self‑insured employers, health plans, and the TPAs that run their claims. They connect to a plan’s claims feed, automatically review 100% of claims, and flag likely billing, coding, and contract errors. The core product is a post‑payment audit engine with some prevention where integrations allow checks before funds go out [Avelis site; YC profile].

When a claim is flagged, Avelis assembles the supporting documentation (plan contract references, audit logs, clinical evidence) and manages recovery/appeals with providers via phone, email, fax, and mail—acting as an extension of the plan’s appeals team. They automate parts of record retrieval with voice agents and use models/LLMs for clinical validation, then provide dashboards so customers can track dollars recovered and where errors occur [Avelis site; YC profile]. The company positions typical savings at roughly 3–7% of annual claims spend and cites earlier consumer wins as part of its founding story [Avelis site; YC profile].

Who are their target customer(s)

• Self‑insured employer finance or benefits leaders (CFOs, Benefits Directors): They pay claims directly and lose money when billing/coding/contract errors go undiscovered; they also need a clear audit trail to meet fiduciary obligations under ERISA. Avelis targets 3–7% savings on annual claims spend [Avelis site; YC profile].
• Health plan payment integrity or recovery teams: They must find and recover incorrect payments across millions of claims and manage provider appeals, which is labor‑intensive without automated detection and evidence assembly [Avelis site; YC profile].
• Third‑party administrator (TPA) operations managers: They juggle many data feeds and a high volume of disputes/appeals; they need tools that surface likely errors automatically and offload documentation and provider outreach [Avelis site].
• ERISA/compliance or legal teams at plan sponsors: They worry about fiduciary risk and need auditable documentation explaining why payments were recovered or allowed, especially if disputes or regulatory reviews occur [Avelis site].
• Benefits consultants and brokers advising self‑insured clients: They need defensible savings and clear reporting to prove value to clients and avoid credibility loss when claims spend is unexpectedly high [Avelis site; YC profile].

How would they acquire their first 10, 50, and 100 customers

• First 10: Founder‑led outreach to self‑insured employers, benefits leaders, and TPAs with a 60–90 day post‑payment audit on contingency, integrating a claims feed and delivering recoveries plus an ERISA‑ready report; reference Avelis’ 3–7% savings positioning to frame the pilot [Avelis site; YC profile].
• First 50: Package a repeatable pilot and commercial playbook (standard integration scope, SLA, visible appeals workflow) and use early customers as references with brokers and mid‑market employers; add 1–2 sales/operator hires to run demos and close deals.
• First 100: Partner with mid‑to‑large TPAs and brokers as channels that bundle Avelis into standard services; ship integration templates and onboarding checklists to shorten deployments, while investing in automation (record retrieval, appeal packets) so manual work doesn’t scale linearly.

What is the rough total addressable market

Top-down context:

The core pool Avelis audits is U.S. self‑insured employer medical claims, estimated at roughly $580B annually by applying the ~65% self‑funded share to CMS’s $894B in 2023 private‑business health spending [CMS; KFF].

Bottom-up calculation:

Using Avelis’ stated 3–7% savings range on that ~$580B pool implies ~$17–$41B in recoverable/avoidable dollars per year for self‑insured employer claims [Avelis site]. The vendor market for payment integrity software/services is much smaller—low billions today, with global estimates higher [Mordor].

Assumptions:

• Use CMS private‑business health spending as a proxy for employer‑funded claims/premiums [CMS].
• Assume ~65% of covered workers are in self‑funded plans [KFF].
• Assume 3–7% of claims are recoverable/avoidable as positioned by Avelis; actuals vary by plan and contracts [Avelis site].

Who are some of their notable competitors

• Cotiviti: Incumbent payment‑integrity and analytics provider offering broad pre‑ and post‑pay audit programs, deep rules engines, and large‑scale recovery operations for major payers/TPAs.
• Optum (UnitedHealth / Change Healthcare): Large, vertically integrated vendor with claims editing, retrospective audits, and services integrated into payer operations—often bundled with broader Optum offerings.
• Conduent: BPO/outsourcing player that runs end‑to‑end payment‑integrity programs, emphasizing operations capacity for audits, appeals, and provider outreach.
• ClarisHealth: Platform‑first solution (Pareo) enabling plans/TPAs to insource pre‑ and post‑pay analytics and workflows—a technology alternative to outsourced recovery teams.
• Alivia Analytics: Analytics/AI‑focused vendor targeting commercial plans, TPAs, and self‑insured employers with detection plus recovery services, overlapping Avelis’ mid‑market focus.