Candid Health raises $120M to automate healthcare billing with AI

Candid Health has closed a $120 million Series D funding round to accelerate development of its AI-powered revenue cycle management platform, according to details first reported by Fierce Healthcare. The round, led by Sixth Street Growth with participation from Oak HC/FT, 8VC, and Y Combinator, tripled the company's valuation from its Series C last year.

The 2019-founded startup has now raised more than $219 million total, including $52.5 million in February 2025. The company reported 190% year-over-year growth in annual contracted run-rate revenue and 180% net dollar retention in 2025.

Why it matters

Healthcare organizations spend $280 billion annually on revenue cycle management processes, much of it on manual billing work that remains largely unchanged from two decades ago. As provider groups consolidate and insurance rules multiply, administrative costs are rising while legacy RCM software struggles to keep pace. Candid's approach—rebuilding billing infrastructure from the ground up using AI and automation—represents a fundamental rethinking of how claims should be processed, with potential implications for healthcare costs and provider efficiency across the industry.

Built by Palantir veterans

Co-founders Nick Perry and Doug Proctor spent five years together at Palantir working on data engineering and automation before launching Candid Health. Perry, now CEO, frames RCM as fundamentally a data engineering problem rather than a workflow management challenge.

The platform unifies clinical, billing, and provider data into a single model, then uses a configurable rules engine and AI agents to automate tasks billing teams traditionally handled manually. The system tracks every remaining manual touch to help teams continuously identify and eliminate repetitive work.

Three-pillar automation strategy

Candid's platform centers on three core capabilities: data integration, automation orchestration, and reporting visibility. The company rebuilt the data model layer to incorporate frequently disconnected information including contracts, credentialing, service facilities, and fee schedules.

The platform deploys multiple automation forms—AI agents, deterministic rules, and machine learning models—operating together in the same system. Candid continuously reverse-engineers new payer rules and deploys them to customers, helping organizations stay current with rule changes and updates.

The company now serves more than 200 healthcare organizations including digital health startups, large management services organizations, and electronic medical record companies, processing approximately $7 billion in claim volume annually.

Customer results

Talkiatry, a virtual psychiatry practice, reduced manual billing work by 40% while increasing claim volume after implementing Candid's platform. The practice achieved a 98.3% payer net collection rate with an initial denial rate of just 3.3%. Nourish, another customer, similarly streamlined its RCM operations through the platform.

Investment plans

Candid will use the fresh capital to expand its team, invest in automation and tooling for core RCM workflows, and accelerate development of agentic RCM solutions. The company aims to extend automation to handle edge cases that previously required human intervention.

Perry argues that legacy RCM software vendors, built more than 20 years ago when billers manually processed claims, still operate fundamentally the same way—with human teams fixing claims one at a time. He asserts that incumbent players haven't kept pace with innovation and that companies "lightly sprinkling AI on top" have yet to deliver meaningful results.

These details were first reported by Fierce Healthcare.