Stack Health Raises $21M to Replace Group Insurance
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Stack Health has closed a $21 million Seed round led by 8VC, with A*, Heartland Ventures, The O.H.I.O. Fund and other investors participating.
The company is based in Columbus, and it was founded by Alex Frommeyer, the founder and former chief executive of Beam Benefits.
What Stack sells is an alternative to group health coverage. It uses individual coverage health reimbursement arrangements, or ICHRAs, which were introduced in 2020. Under that structure an employer sets an insurance amount and reimburses health care spending rather than buying a group plan. Stack then helps employees compare individual policies and pick one.
The arithmetic is simple enough to explain in a sentence. If an employer currently spends $500 a month per person on health benefits, Stack lets it provide a $500 monthly health allowance instead, and the employee chooses a policy based on preferred doctors or whatever else matters to them.
The rollout is deliberately narrow at first. Stack will prove the concept in Central Ohio, working only with companies whose staff are overwhelmingly based there, and refine the model before expanding.
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