MDSave, a Nashville, Tennessee-based healthcare transparency company, secured a $5 million investment from Cambia Health, a holding company that owns a number of large insurance plans, MobiHealthNews has learned.
“It was a strategic investment by Cambia to help MDSave expand our portfolio of our payer services that we offer,” MDSave CEO Paul Ketchel told MobiHealthNews. “We have a partnership with a couple of their companies and the reason for the investment is to expand our offerings through not only Cambia’s companies but also the Cambia customer base.”
MDSave is a 4-year-old company with offices in Nashville and San Francisco. The company raised $14 million last year from MTS Health Partners in New York, plus some seed funding prior to that. This raise brings the company’s total funding to $21.5 million.
The company’s approach to cost transparency is a little different than many in the space, who use claims data to give cost estimates. MDSave actually works with providers and insurers to bundle healthcare payments then acts as a middleman to sell those products to consumers.
“It allows our healthcare systems to fully bundle episodes of care among their owned and affiliated providers,” Ketchel explained. “We offer a single price to the consumer and then our software will unbundle the payment and disperse it automatically among the stakeholders that are part of that episode of care. We offer a discounted price upfront to the consumer and, in exchange, we guarantee the health system zero bad debt and we pay the cost within six days of claims to file. We collect the money from the patient upfront and send it in.”
MDSave collects a small transaction fee from the customer. The customer experience is online or via an iOS app. MDSave alerts consumers to the service via traditional and online marketing channels, as well as encouraging providers to tell their patients about the service when they refer them to a specialist.
“The consumer experience follows a very simple consumer e-commerce experience,” Ketchel said. “It’s no different from buying something on Amazon or Expedia. You simply go in, it gives you a suggested search, people find what they’re looking for, they see a clear display about the providers, the price, information about the providers and the procedure they’re buying. It’s made to mirror the same e-commerce experience from any other industry.”
Going forward, the company wants to make its payment-bundling capabilities available to ACOs and other providers and payers using value-based payment methods as a new, separate product. That’s part of the plan for the new funding.
But the main focus will remain on the cost transparency offering, which Ketchel says is very different from its competitors.
“There’s a lot of transparency out there where it's, ‘Oh I get a cost estimating range and it helps my employees understand the costs’,” he said. “But the problem for a consumer is if you see what should be a fair price in your area, trying to truly access that price and the providers can be pretty difficult. With MDSave, all those prices are pre-built in and negotiated, so what you see is what you get.”