Meet the startup using AI to reduce healthcare’s trillion-dollar administrative burden

Anterior, a clinician-founded healthcare technology startup, has raised $20 million in Series A funding to tackle administrative inefficiencies in healthcare in the U.S. The round was led by New Enterprise Associates (NEA), with participation from existing investors including Sequoia Capital.

Founded by Dr. Abdel Mahmoud, a physician with a background in computer science, Anterior aims to use artificial intelligence to streamline the prior authorization process for health insurers. The company’s AI system acts as a “co-pilot” for nurses reviewing medical records, potentially increasing productivity from 10 to 20-30 cases per day.

“Our mission is very broad. [to reduce] “Half of the trillion dollars spent on administrative processes is spent by payers, so that’s where we’re going to focus most of our efforts,” Mahmood explained in an exclusive interview with VentureBeat.

From fax machines to AI: The technology behind Anterior’s healthcare revolution

Anterior’s technology combines narrow AI systems with large-scale language models to process unstructured medical data. “What we’ve really done is combine the decades of progress we’ve made in AI with the power that large-scale language models bring to the table and bridge the unstructured environment,” Mahmoud told VentureBeat.

Their approach involves three key elements: structuring unstructured medical records, translating complex clinical criteria into computer-executable logic, and applying clinical reasoning to make initial judgments that are then verified by human nurses.

While initially focused on prior authorization, Anterior sees potential applications in other areas of healthcare management, including care management, payment integrity and claims adjudication.

“Companies don’t hire doctors to provide medical care, they hire them to make business decisions, so they’re paying them for some clinical reasoning,” Mahmood said.

From clinician to engineer: Anterior’s unique approach to building AI for healthcare

What’s unique about Anterior is that it integrates clinical expertise into its technology team: Mahmood says about half of the company’s staff are clinicians or have clinical backgrounds, some of whom have transitioned into AI engineering roles.

The funding comes at a time when the healthcare industry is grappling with talent shortages and rising administrative costs. If successful, Anterior’s technology could significantly reduce the time and resources health insurers spend on administrative tasks, leading to cost savings across the healthcare system.

But as the company looks to expand its reach, it will need to navigate a complex regulatory environment and earn the trust of healthcare providers and insurers. As AI plays an increasingly important role in healthcare decision-making, ensuring accuracy, safety and transparency will be critical for companies like Anterior.

With this new funding, Anterior is well positioned to scale and bring its AI-powered solutions to more health plans across the U.S. As the healthcare industry continues to digitize and become more efficient, startups that can effectively blend clinical expertise with cutting-edge AI technology could find significant growth opportunities.