Included Health Inc., a virtual care and health navigation company, has entered into an agreement to acquire Firefly Health Inc. to expand alternative health plans for employers.
In January, Included Health began designing alternative health plans for employers and expanding its existing all-in-one virtual care platform. Founded in 2017, Firefly Health is a primary care and health plan provider serving more than 20,000 individuals nationwide.
The transaction is expected to close in the third quarter of 2026. The companies did not disclose financial details of the acquisition.
“In some ways, this is very much of the moment and what the market needs, and in some ways it’s also a very long-term vision, and I think we both shared the idea of where the country as a whole needs to go in terms of health insurance delivery,” Owen Tripp, co-founder and CEO of Included Health, said of the news in an exclusive interview with Fierce Healthcare. “We see an opportunity for Firefly to accelerate the overall alternative care plan to provide more access to our members, provide better care, and provide better financial outcomes for our members, and Firefly has been doing just that for years.”
He said the acquisition was a “perfect fit” because it would allow Included Health to advance its “primary care-focused efforts to provide superior health plans to our members.”
According to Fay Rotenberg, CEO of Firefly Health, Firefly Health has built a clinically integrated health plan that has demonstrated more than 15% total health care cost savings across its entire managed services only (ASO) book of business compared to risk-adjusted market benchmarks. She noted that the company’s model increases chronic disease outcomes by 50% to 80% while achieving member satisfaction rates of 90%.
“This model is working, and Include has the scale to bring this to even more employers across the country,” she said in an interview with Fierce Healthcare.
The company says these results were achieved by combining NCQA-certified team-based primary care with nationwide quality-driven navigation to high-value virtual and in-person providers.
Included Health works with health plans and employers, including one-third of the Fortune 100 companies. The company offers virtual primary care, behavioral health, specialty care, expert medical opinion, and urgent care appointments, as well as medical benefits and insurance navigation. The company rolled out a personalized AI assistant and chatbot (called Dot) in December.
The pending acquisition will bring together Included Health’s AI-native virtual care platform and Firefly’s clinically integrated health plans that integrate primary care with a nationwide home and home care and specialty network. Company executives say the combination creates an alternative to large health plans designed to generate long-term savings for employers by providing employees with better care through a modern experience at a predictable cost.
Health care costs for U.S. employers are projected to increase significantly in 2027, with PwC predicting that health care costs will trend up by 9% before employers implement plan design changes.
Included Health and Firefly share a core belief that investing in primary care and directing people to high-quality care actually reduces unnecessary costs, Tripp noted. “Together, we are delivering a single, connected benefits experience for employers that integrates plan design and management, comprehensive care, and complete system support to reduce friction, improve employee health, and lower costs.”
Included Health has a national clinical team across primary care, behavioral health, specialty care, and complex case management, leveraging AI-native experiences to support tens of millions of members. Firefly Health “adds significant depth to that foundation” with an NCQA-certified advanced primary care model, a national ecosystem of more than 2,300 in-person, home and specialty partners, and a proven health planning model, executives said.
Rothenberg maintained that the two companies’ missions were aligned from the beginning. “We put our members first. We both place great importance on delivering not just clinical health, but financial health. We believe that putting care at the core of every plan design is essential, but going a step further and aligning financial incentives is how we really close the loop on amplifying that value,” she said.
She added, “We’re all heading toward the same thing, but with a different order of steps. Firefly started as virtual-first advanced primary care. We’ve built an integrated network of physical facilities in all 50 states that allows us to provide both in-person and home care in all 50 states. We have the navigation capabilities to navigate within our broader national network.”
Firefly made its first foray into health insurance. The company launched new health insurance benefits for employers in 2021. Rothenberg said the company’s planning architecture aligns incentives so that the highest quality care is always the most affordable option. “Then the clinical and financial results will follow naturally,” she says.
“(It starts with) navigation, then care delivery, and now plan design. We both believe that these four components, with a concierge member experience that ties it all together, are critical to truly creating sustainable total cost of care savings without creating member friction or reducing access, access, or quality of care,” Rotenberg said.
Tripp said the combined company will have four key differentiators targeted to the health benefits needs of employers. Nationwide care delivery, including urgent care through primary and specialty care, network optimization, dynamic plan design, and the concierge member experience.
He said Included Health’s acquisition of Firefly Health will allow it to optimize its network to give employees “easier access to higher quality physicians locally and nationally, giving them not just a narrow network, but real access, real selection and real curation of the best of the best.”
“The majority of other alternative health plans are really just narrowing the network because they only operate with one or two of these vehicles. They’re just offering a dynamic plan design,” Rotenberg said. “We believe you need to have all four to achieve real sustainable year-over-year savings without compromising access or quality of care. We believe we are the only independent company in the market to say that.”
According to WTW data, 41% of employers currently utilize alternative health plan designs, and an additional 46% plan or consider implementing one within the next two years. These changes are aimed at containing rising healthcare costs while avoiding aggressive cost-shifting to employees.
“We can tell you that almost half of employers are actively considering or planning to consider alternative health plans. What sets us apart is that we’re independent, so we’re not tied to an existing insurance company, and we have all four levers that we believe can deliver a sustainable total cost of care management,” said Rotenberg.
