Healthfuse gains investment from Alabama private equity firm

Nick Fricano, Jon Myhre, Kelly Welch and Nick Corrao.
Nick Fricano, Jon Myhre, Kelly Welch and Nick Corrao. Credit: Jake Hill

Milwaukee-based Healthfuse has attracted an investment from New Capital Partners, a private equity and venture capital firm based in Birmingham, Alabama.

The terms of the investment were not disclosed.

Founded in 2011 by Nick Fricano, Mike Zimmerman and Jon Myhre, Healthfuse provides revenue cycle vendor management services to hospitals and health systems. The startup combines technology, analytics and research to review revenue cycle vendors and help health care organizations establish revenue cycle best practices.

“Health care reimbursement and revenue cycle operations have grown increasingly complex, driving hospitals to work harder with fewer hands and insufficient tools,” Fricano, Healthfuse chief executive officer, said in a statement. “NCP has a proven track record of building high-growth businesses that leverage technology to deliver market-leading performance. I look forward to partnering with them to enhance Healthfuse’s comprehensive data platform to enable best practices and benchmarking across a national network of health systems.”

NCP is a health care-focused investment firm led by former founders and operators of health care companies. The private equity firm has 14 active portfolio companies and has invested in nearly 30 companies since it was founded in 2000.

Fricano, chief operating officer Jon Myhre and the Healthfuse management team will continue to lead the company in partnership with NCP, according to a press release.

Healthfuse provides its services to more than 150 hospitals and health systems. Over the last five years, the company has improved vendor performance by $600 million and delivered $140.5 million in collections and cost savings for clients since 2019.

Healthfuse achieved record growth in 2019 after the company grew by 40% year-over-year and added 53 more hospitals to its portfolio, increasing its market penetration by 30%, Fricano previously told BizTimes.

“Healthfuse’s recent growth indicates that the market is increasingly aware of the value of performance-driven, tech enabled revenue cycle vendor management,” NCP managing director Adam Cranford said in a statement. “We are excited to build upon their foundation of success and look forward to actively supporting the team as they enter their next phase of growth.”

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