Included Health, a San Francisco virtual care and health navigation company, signed a definitive agreement to acquire Firefly Health, a virtual-first primary care provider that also runs a clinically integrated health plan. The deal was announced on July 28, 2026.
Financial terms were not disclosed, and a spokesperson declined to give details. The acquisition was expected to close in the third quarter of 2026, subject to regulatory review.
The companies plan to combine Firefly's model with the alternative health plan design that Included Health launched for employers earlier in 2026, giving employers a single benefits product instead of a traditional health plan with separate add-on services.
What Firefly built
Firefly Health was founded in 2017 by two doctors and is based in Watertown, Massachusetts. Fay Rotenberg is chief executive. The company serves about 20,000 people across the United States.
Its health plan combines team-based primary care, chronic condition management, mental health care and specialty care with help finding providers. It works with a nationwide network of more than 2,300 in-person, in-home and specialty partners.
Rotenberg said Firefly flips the traditional model on its head, combining the care team and the health plan in one product.
Firefly reported a 15% reduction in total cost of care against risk-adjusted market benchmarks across its full book of self-funded (ASO) employer clients in 2025, with some individual clients saving more than 17%. It said every customer saved money and reported 90% member satisfaction. These figures are company-reported.
“Firefly's proven results in total cost of care and member experience align and complement our core offerings.”
The funding
In April 2021 Firefly raised a $40 million Series B led by Andreessen Horowitz, with existing investors F-Prime Capital and Oak HC/FT participating. The money was used to launch its health plan for employers. At the time Jonathan Bush was named as executive chairman.
At the time of that round Firefly operated in Massachusetts, Maine, New York and New Jersey. It has since built the nationwide partner network it uses today.
Total funding figures for Firefly differ between data providers, and neither company disclosed the amount Firefly had raised in total.
Why Included Health is buying
Included Health was formed in 2021 through the merger of Grand Rounds Health and Doctor On Demand. It offers virtual and in-person care, care navigation and coordination, and round-the-clock support, and serves tens of millions of people through contracts with more than 300 employers and health plans. Owen Tripp is co-founder and chief executive.
Included Health also runs an AI assistant called Dot, which answers members' questions and can hand them over to human support staff. Its alternative plan design, launched earlier this year, is built on its existing virtual care platform.
Tripp said Firefly's results on cost of care and member experience complemented Included Health's existing services, and that the combination would give employers a single, connected benefits experience. Rotenberg said employers who want different results need a different model.
Tripp said Included Health had spent years working closely with employers and their members, and had seen that the health system is not built around what people actually need.
Employers look for alternatives
The deal comes as US employers face rising health costs. Mercer projected that employer health benefit costs would rise 6.7% this year, the largest increase in 15 years.
Healthcare Dive cited other estimates closer to 9%, and reported that nearly one-third of employers offer or plan to offer at least one non-traditional medical plan in 2027, with another 38% considering one.
A Business Group on Health survey found that 17% of employers had adopted a non-traditional or alternative health plan, 7% were adding one in 2026 and 36% were considering one. Included Health's own alternative plan design is built around primary care and shows members their costs upfront.
What happens next
The deal had not closed when it was announced, and regulatory review was still pending. The companies did not say whether the Firefly brand would be kept, how many Firefly employees would join Included Health, or how existing Firefly employer clients would be moved onto the combined plan.
