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Most people find out they lack health insurance coverage during a traumatic experience. This is exactly what happened to Ali Diab. Not too long ago, he was admitted to Palo Alto’s Stanford Hospital after suffering intense abdominal pain. A closer look revealed that the man had a twisted intestine.

Doctors were forced to operate on him immediately to remedy the situation. The medical team that night did their job well and performed a life-saving procedure. But the professionals who created Diab’s health insurance plan did not. After the operation, he was pegged with several denied claims. To cut the long story short, the plan that he relied on during the ordeal failed him. Later on, he found out that the package he was tied to did not cover the incident.

After facing thousands of dollars in bills and payments, Diab decided it was time to do something about the issue that overshadows the treatment of countless patients nationwide. So he did what any San Francisco-based tech entrepreneur would do: start a company that offers health insurance services.

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Closing the Health Coverage Gap

The startup, called Collective Health, is revolutionizing the insurance space by simplifying the coverage process. Essentially, the group removes the need for complex tie-ups with health insurance companies by allowing its clients (usually businesses) to create their own type of coverage. By eliminating components from a traditional package that are unusable, the startup hopes to reduce the overall cost of insurance packages.

Diab has been able to gather support from several prominent names and establishments. In a very successful Series C funding round, the group raised $81 million. Notable investors include NEA, Founders Fund, Maverick Capital, Redpoint Ventures and RRE Ventures. Google Ventures, the tech giant’s venture capital arm, also jumped in on the action and participated in the campaign. Earlier this year, the business raised $32 million during a Series B round. To bolster its presence in the medical field, the company announced strategic partnerships with Anthem and Blue Shield of California.

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Rapid Expansion Ahead

Since its inception in 2013, Collective Health raised over $119 million to develop its services. For now, the startup only caters to California-based employers, including Activision Blizzard, Inc, a leading video game brand. But it does plan to expand its offerings nationally to other thriving businesses. If all goes according to plan, the group should be able to hit its target of addressing $2 billion in claims by 2017.

“We’re working to shift the focus of health insurance from profits to people,” said Diab, who is also the CEO of Collective Health. “This significant infusion of capital comes at the perfect moment, enabling us to make our solution available to companies across the U.S. The funding will also enable us to continue to invest in building out our world-class team, forge new relationships with key partners and significantly grow our customer base. Ultimately, this funding will give Collective Health a big boost in our mission to make the healthcare experience in our country something we can all feel proud of.”

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