Medallion wants to fix a messy and expensive problem in U.S. healthcare: credentialing.
The $1 Billion Credentialing Headache
Doctors can only practice in states where they hold a license. But it doesn’t end there. Every insurer they work with must verify their credentials. The process is slow, repetitive, and expensive — costing over $1 billion annually.
Miss a deadline? In that case, you can’t work with that insurer until it’s fixed. Similarly, lose a required form? You’re out again.
Medallion, a San Francisco-based startup, thinks it has the solution. CEO Derek Lo says their software can remove the unnecessary complexity. His team has built a national credentialing clearinghouse that standardizes the process and reduces time and cost.
“It doesn’t make sense to credential the same doctor 20 times and to do it every three years across all these plans,” Lo told Forbes. “There should be a single clearinghouse to standardize this.”
Introducing CredAlliance
After months of working quietly, Medallion is launching CredAlliance, its new clearinghouse platform. So far, a few dozen insurers have already signed up. Lo says five of the country’s 10 largest health plans are considering joining as well.
Dr. Sachin Jain, CEO of Scan Health and an advisor to Medallion, agrees this is a big opportunity:
“There’s a lot of data submission and credentialing verification that goes on, most of which is duplicative and repetitive.”
Credentialing is just one part of what Medallion handles. Since launching in 2020, the company has focused on automating healthcare back-office tasks like compliance and operations.
Growth, Funding, and Revenue
Medallion has raised $130 million in total, including a previously undisclosed $43 million round led by Acrew Capital in July. Its current estimated valuation is $440 million.
The company’s contracted annual revenue is approaching $50 million, with clients like:
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Tampa General Hospital, a 982-bed nonprofit in Florida
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Headspace, the digital mental health platform
Lo, a Forbes 30 Under 30 alum, believes there’s still a lot of inefficiency to eliminate.
The Scale of the Problem
Credentialing involves evaluating providers — doctors, nurses, therapists — to ensure they meet education and licensing requirements. According to Lo, there are about 4 million credentialed providers in the U.S., and each one works with an average of 19 insurers.
That adds up to an estimated 25 million credentialing events every year.
“It’s like, wow, that seems really stupid,” Lo said.
Insurers typically run these checks. But they all do it separately — creating duplicate work for providers and their staff. For hospitals and clinics already dealing with staff shortages, the paperwork is a serious burden.
Medallion’s Clearinghouse Model
Lo’s idea: create one centralized clearinghouse where insurers share the cost and reduce duplication. Normally, Medallion charges $30 to $50 per credentialing process per doctor. But as more payers join the system, costs can be shared — bringing that price down.
In addition, the platform allows doctors to sync their credentialing expiration dates, making it easier to track and manage renewals.
“Across the large payers, there is significant overlap,” said Lo.
“As we were growing, we could see how much duplication there is. There’s no reason everyone needs to do the same thing over and over again.”
Big Clients and a National Push
Customers already using the new platform include:
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CareSource, covering more than 2 million members
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Valor Health Plans, focused on Medicare Advantage for nursing home residents
While past efforts have coordinated credentialing locally or regionally, Medallion is the first to try it nationally. That may sound surprising in a venture-backed world where most investors prefer to expand markets rather than shrink them.
But Lo has a different vision:
“We want to own the credentialing market — and we want to shrink it.”
