Alaffia Health, a provider of agentic AI for health plan claims operations, has secured $55 million in Series B financing. The funding round was led by Transformation Capital, with additional participation from existing investors including FirstMark Capital, Tau Ventures, and Twine Ventures. This latest investment brings Alaffia’s total funding to more than $73 million.
Health plans are currently navigating increasing medical costs, heightened regulatory scrutiny, and an estimated $570 billion in annual administrative waste. This environment has driven demand for AI solutions capable of delivering cost savings without incurring compliance or provider-relations risks. Alaffia Health, founded in 2020 by siblings TJ Ademiluyi and Adun Akanni, was established to address these operational challenges, leveraging their prior experience in revenue cycle management through a family business.
Alaffia currently collaborates with regional and national health plans to enhance their clinical review capacity and achieve substantial savings. The company’s solutions have reportedly generated millions of dollars in medical cost savings, reduced claim turnaround times from weeks to days, and improved consistency in findings. By integrating expert clinicians with AI that forensically evaluates claims against comprehensive patient medical records, Alaffia facilitates faster, more accurate, and more defensible outcomes throughout the claims lifecycle. Its platform has achieved an average of over 20% savings on high-cost facility claims and a return on investment exceeding 5x for its partner health plans.
TJ Ademiluyi, co-founder and CEO of Alaffia, stated, “Health plans are under immense pressure to reduce administrative costs and drive affordability for their members, and like many industries, they’re starting to see the value of emerging AI solutions. With this funding, we’re expanding our team and platform so we can continue solving some of the most expensive operational challenges in healthcare and ultimately reduce the burden on the system as a whole.”
The new capital will be used to accelerate growth across three key areas: research and development to advance AI, engineering, and product development; innovation, including the launch of new AI agents across additional modalities; and scaling AI adoption to meet increasing demand within the healthcare ecosystem. The company also plans to expand its engineering, product, and growth teams.
As part of the financing round, Todd Cozzens, Managing Partner at Transformation Capital, has joined Alaffia’s Board of Directors. Transformation Capital is a digital health growth equity firm focused on supporting companies that aim to improve health outcomes and the sustainability of the healthcare system.
Todd Cozzens commented, “Payment integrity is one of the most untapped opportunities in healthcare, in part because payers are harder to build for due to their complex and diverse rule sets. Alaffia has built a core clinical review platform that is already delivering millions in savings and can scale beyond payment integrity to become foundational infrastructure for health plans. By reducing administrative waste and improving accuracy across claims operations, Alaffia ultimately helps lower costs for health plans — creating a more affordable healthcare system for consumers.”
Alaffia Health differentiates itself from traditional payment integrity vendors and emerging AI-only solutions through a platform designed specifically for real-world payer environments, where traceability, configurability, and clinical oversight are crucial. The platform offers over 97% accurate clinical fact extraction and flexible software-as-a-service and managed services delivery, aiming to provide confidence and consistency in complex healthcare workflows.
Adun Akanni, co-founder and COO at Alaffia, added, “Healthcare doesn’t need more automation that no one can explain — it needs AI that clinicians, operators, and regulators can trust. We founded Alaffia to bring transparency and clinical rigor to claims operations, and this funding allows us to scale that mission as we help health plans reduce waste and operate with confidence.”
Founded in 2020, Alaffia Health reports having saved health plans $100 million in medical costs to date. Its solutions support workflows across Payment Integrity, Utilization Management, and Appeals, providing clinical context and operational intelligence for improved speed and accuracy.
