TechStars alum EveryMove (@EveryMove) has closed a $2.6 million Series A round to continue development of a healthy rewards platform they call a “mileage plan for health benefits”.

The round included Premera Blue Cross, Blue Cross Blue Shield of Nebraska, Blue Cross Blue Shield Venture Partners (managed by Sandbox Industries), Founder’s Co-op, Summit Capital, as well as angel investors Jonathan Spesato, Geoff Entress, Matt Shobe, William Lohse, Andy Liu, Ken Kuntz, and others.

EveryMove’s platform enables insurance companies, employers and brands to provide incentives and rewards based on individual’s healthy life choices. Average annual premiums for family coverage through an employer reached $15,073 in 2011, up 9 percent over the previous year according to a study by the Kaiser Family Foundation. Most expect this growth rate to continue, taking up a larger share of household budgets every year as income growth fails to keep pace with premiums.

The service connects people through their lifestyle style actions, which are captured through the passive collection of data generated by various health and social applications.

For example, use Foursquare to check-in at the gym and you earn points. If you record your morning run using RunKeeper, you earn more points. This is a powerful model for determining rewards, particularly the fact that it appears to be totally passive in nature, leaving consumers to go about their typical routine without any additional pressure or burden of a service to update all day manually.

“We’re solving a problem that has plagued all of us for a long time,” said EveryMove founder Russell Benaroya in a post on the company’s blog. “How do we empower consumers to have more control over the impact of their lifestyle activities on their healthcare costs? How do we create choices? How do we let individuals realize the economic value of all the great health actions they are taking in their life rather than giving it away? We want to solve that problem and believe that the health of our economy rests on consumers taking control! We will be there for you.”

“It is time to make room at the table for consumers to be part of the conversation around their health. Technology is enabling consumers to more easily demonstrate the value of their lifestyle activities and that is empowering. At EveryMove, individuals will have an opportunity to turn their lifestyle activities into real value for their actions. With this funding, we bring together significant strategic partners in support of our efforts,” said EveryMove’s Co-founder and CEO Russell Benaroya in a press release. “The healthcare industry is recognizing that the future is in how we engage with and empower consumers to impact overall health costs,” he added.

EveryMove will certainly have no shortage of competition in this space, with several new healthy incentive startups launching recently, but their partnerships with Blue Cross at an early stage gives them an early leg up on the competitors. Adding Chicago-based Sandbox Industries to their list of investors in the latest round also brings one of the leading digital health venture capital firms to the table.

“We are thrilled to be working with the EveryMove team to build a market-leading incentives and rewards platform for consumers who are making healthy decisions. They have the capabilities and strategic alignment to achieve this vision and in turn help health plans create new and exciting products for the future generation of healthcare consumers,” said Anna Haghgooie, Managing Director of Sandbox Industries, the fund manager of BCBS Venture Partners.

In a great post on his personal blog, co-founder Marcelo Calbucci explained how important and lucky is was for them to land Sandbox as a strategic partner/investor.

“Sandbox was just an unbelievable combination of timing and luck. Let me just start by saying if you gave me a list of all the VCs in the US and told me to pick which one I wanted to invest in EveryMove, Sandbox would be it… Sandbox, more than any other VC in the US, get to see day in and day out pitches from startups in the health space. They know what’s going to happen tomorrow, and what’s going to happen two years from now in this industry. They are also very active helping their portfolio companies to get introductions and make strikes to their Limited Partners (a.k.a. the dozen or so health insurance companies who put their money together). There is no ‘health entrepreneur’ who doesn’t want Sandbox on their side. I feel lucky and fortunate.”

In the same post, Calbucci also gave a very well articulated explanation of EveryMove’s philosophy and why a service such as their’s is so vital for there to be meaningful changes to the health care system.

“Today, there is very little you can do to make your lifestyle choices impact your out-of-pocket health insurance cost. If you exercise, eat well, sleep eight hours a night and don’t smoke, you are pretty much paying the exact same amount as someone who is living a very unhealthy lifestyle. That’s where EveryMove kicks in. We are playing a very complex technological, regulatory, consumer-oriented, enterprise-enabled game. We’ll enable you, the consumer, to systematically and near frictionless get a discount or cash-back from your insurer or employer.”

In the age of the accountable care organization, it seems perfectly logical to me that individuals should also be held accountable for living healthier lifestyles, and rewarded/penalized accordingly. Lets not forget the ongoing and accelerating obesity epidemic, which is surging past 20 percent in nearly every state of the country.

We should be doing everything we can to fight this major public health crisis and no better way, in my opinion, than to make those who are living unhealthy lifestyles pay for it.

The company will monetize the platform on a cost-per-action basis by taking a fee when users redeem rewards or incentives from their plan, brands or employer. The video below is the company’s TechStar’s pitch.


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