Merity (missapp) engr 245 lean launchpad stanford 2020
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The document outlines a startup's journey through three pivots focused on addressing missed medical appointments due to transportation issues and later evolving towards connecting insurers with social service organizations for better patient support. The team identified a significant revenue loss due to missed appointments and developed a digital referral platform to enhance efficiency for caseworkers and integrate social services. They aim to build a sustainable business model within the healthcare sector by charging insurers a fee per member while improving patient outcomes and operational efficiency.
Merity (missapp) engr 245 lean launchpad stanford 2020
- 1. From reducing missed appointments… to enabling social service referrals Day 1 Transportation for at-risk patients to decrease missed appointments. Market Type: New Market Now Platform for insurance companies to manage non- medical service providers. Market Type: New Market Tori Seidenstein Han Lin Aung Ruben Amar Sehj Kashyap Sarah Jacobson Picker MBA & BS Computer Science Hacker MS & BS Computer Science Hustler MBA & MS Engineering Designer MD & MS Bioinformatics Picker MBA & MS MS&E 140 Interviews
- 2. Pivot #1 The Climb This is our 10 week journey - 3 pivots, 3 MVPs. Pivot #2 Pivot #3 MVP #1 MVP #3 MVP #2
- 3. Value Prop High-touch collaboration to integrate with existing IT systems Ongoing maintenance and support Direct sales Publish randomized control trial Avert costly emergency visits by ensuring patients receive emergency care Customer Relationships Lyft and Uber Non emergency medical transportation providers Appointment data and health data Sales team Software and ML engineers Capture $180 missed revenue per appointment Save time Integrate with healthcare system data Build ML model to predict which patients will miss appointments Provide data to healthcare system Key Partners Server costs, text messaging costs Integration costs Marketing and sales costs Annual contract with clinic + per-ride fee CFOs at insurers Key Activities Key Resources Customer Segments Channels Revenue StreamsCost Structure Capture missed revenue ($180 per appt) Save time Avoid costly emergency visits Insurance CFOs Clinic managers Value Prop Customer Segments
- 4. Identified a need! $25B lost revenue 51% of missed appointments due to transportation Week 1Chaiyachati et al., JAMA Internal Medicine 2018 Missed appointments are a problem because of lack of transportation.
- 5. “Is transportation a problem?” No - Pacific Dialysis Clinic No - Summit Medical Center No - DaVita Los Angeles No - Satellite Dialysis Center No - Laguna Surgery Center No… (9 more times) Pit of despair We were wrong. 0 out of 14 clinics said that transportation was a reason for no-shows. Week 2
- 6. PIVOT to billing Hypothesis #2: transportation providers need help with billing. Week 3 “Would you pay for a faster billing solution?” No - Del Norte Taxi No - Absolute NEMT No - JBL Med Transport No - Medi-cab No - Ridgecrest medical transport No… (3 more times)
- 7. PIVOT to satisfaction Hypothesis #3: insurers want to improve member satisfaction. Week 4
- 8. Two insurers said they wanted to measure satisfaction across service providers. Week 4 ” Our Medicare Advantage five-star status is worth one billion dollars a year to us. — Kaiser EVP “ ”
- 9. So we built MVP #1 to give insurers insight into how their members rated each service. Week 4
- 10. Deeper pit Insurers say they care about satisfaction, but don’t actually want to uncover complaints! Then they would have to report it. — Domain expert ” “ Week 4 Aha moment
- 11. 6 out of 6 insurers told us they want to connect their members to social services. Week 5 Eureka!
- 12. PIVOT to social services So we set out to improve the way insurers connect with social service orgs. Step 2: Figure out the $$$ Step 1: Map the process Step 3: Find a customer Week 5
- 13. We thought the referral process would be simple. Step 1: Map the process Week 5
- 14. Case worker calls patient Patient discharged from hospital Case worker gets alert from PBM Screening by physician during appointment Patient learns about benefit (via mailer or online) Patient files grievance Social service org invoices insurer Insurer initiated Provider initiated Patient initiated Doctor loops in provider case worker Patient calls insurer ( 1- 800 line) Provider caseworker contacts insurer case worker Social service org delivers service Instead, we learned it’s manual and time consuming for caseworkers. Week 5 Social service org calls patient & coordinates service Case worker calls multiple social service orgs to refer patient Referral Process Conversation with case worker about social needs
- 15. Case worker calls patient Patient discharged from hospital Case worker gets alert from PBM Screening by physician during appointment Patient learns about benefit (via mailer or online) Patient files grievance Social service org invoices insurer Insurer initiated Provider initiated Patient initiated Doctor loops in provider case worker Patient calls insurer ( 1- 800 line) Provider caseworker contacts insurer case worker Social service org delivers service Instead, we learned it’s manual and time consuming for caseworkers. Week 5 Social service org calls patient & coordinates service Case worker calls multiple social service orgs to refer patient Referral Process Conversation with case worker about social needs
- 16. Case worker calls patient Patient discharged from hospital Case worker gets alert from PBM Screening by physician during appointment Patient learns about benefit (via mailer or online) Patient files grievance Social service org invoices insurer Insurer initiated Provider initiated Patient initiated Doctor loops in provider case worker Patient calls insurer ( 1- 800 line) Provider caseworker contacts insurer case worker Social service org delivers service Instead, we learned it’s manual and time consuming for caseworkers. Week 5 Social service org calls patient & coordinates service Case worker calls multiple social service orgs to refer patient Referral Process Conversation with case worker about social needs
- 17. Case worker calls patient Patient discharged from hospital Case worker gets alert from PBM Screening by physician during appointment Patient learns about benefit (via mailer or online) Patient files grievance Social service org invoices insurer Insurer initiated Provider initiated Patient initiated Doctor loops in provider case worker Patient calls insurer ( 1- 800 line) Provider caseworker contacts insurer case worker Social service org delivers service Instead, we learned it’s manual and time consuming for caseworkers. Week 5 Social service org calls patient & coordinates service Case worker calls multiple social service orgs to refer patient Referral Process Conversation with case worker about social needs
- 18. Value Prop Insurers GET: Direct sales teams KEEP: Data on member outcomes GROW: Up-selling features, custom integrations Direct sales Publish randomized control trial Customer Relationships Social service orgs Government (Center for Medicaid and Medicare) Network of social service orgs Software infrastructure (AWS) Implementation team for CBOs Integration team for payors Scale caseworker efficiency Measure impact of social services on health outcomes Decrease medical costs Improve operational efficiency Win new contracts with payors Build integrated network of engaged social service providers Build digital referral platform for caseworkers Collect data when the service was performed Key Partners Headcount: engineering, sales, implementation & ops Technology: AWS Marketing: Conferences, Google Adwords, Direct outreach SAAS ($1-$4 per member per month) paid by insurer Free, freemium (based on size), or tiered (based on features) for CBOs Health insurance supplemental benefit manager Non-profit owner Patient Key Activities Key Resources Customer Segments Channels Revenue StreamsCost Structure Scale case worker efficiency Decrease medical costs
- 19. MVP #2: We connected 4 people with social services and learned how difficult it is. ? Week 7
- 20. Value Prop Insurers GET: Direct sales teams KEEP: Data on member outcomes GROW: Up-selling features, custom integrations Direct sales Publish randomized control trial Customer Relationships Social service orgs Patients Government (Center for Medicaid and Medicare) Network of social service orgs Software infrastructure (AWS) Implementation team for CBOs Integration team for payors Scale caseworker efficiency Measure impact of social services on health outcomes Decrease medical costs Improve operational efficiency Win new contracts with payors Build network of social service providers Build digital referral platform for caseworkers Collect data when the service was performed Key Partners Headcount: engineering, sales, implementation & ops Technology: AWS Marketing: Conferences, Google Adwords, Direct outreach SAAS ($1-$4 per member per month) paid by insurer Free, freemium (based on size), or tiered (based on features) for CBOs Health insurance supplemental benefit manager Non-profit owner Patient Key Activities Key Resources Customer Segments Channels Revenue StreamsCost Structure Social service orgs Value Prop Build engaged community network
- 21. Step 2: Identified value prop Case workers said they would love a digital referral platform to be more efficient. Week 6 It can take 2 hours to do referral for a single patient — Case worker “ ”
- 22. So we built our MVP #3 that aggregates local services and enables seamless referrals. Week 6
- 23. We followed the money and learned insurers would pay $1-4 per member per month. Step 3: Figure out the $$$ $3 per member per month 50k members in Year 3 12 months X $2M annually in Year 3 Week 7
- 24. Step 4: Find a customer We found a customer willing to pay for our product! How can I ensure that a member gets to the service quicker, sooner, more effectively? That is an unmet need that we pay for. - Medicare Advantage Manager “ ” Week 8
- 25. This can be a $20M business in 3 years. $5M $21M$1M 30 customer s Number of regional insurance plans 10 255 PMPM ($) $3 $3$3 Sales (annual) Headcount (Sales reps + Marketing) 17 329 Total # of members 25,000 150,000 575,000 Year 1 Year 2 Year 3 x12 x12x12
- 26. What’s next for Merity Continuing with Merity Continuing with Merity Pursuing another business in the space Interning at Facebook Pursuing healthcare informatics
- 27. Thank you to the Lean Launchpad Teaching team and our mentor, Nancy Deyo!
Editor's Notes
- #2: On day 1 we were … Now we are … Let me tell you the story of how we got there with 140 interviews, countless tests, and a lot of adventure 3 3 2
- #3: After starting on transportation, we hit rock bottom pretty quickly We pivoted three times
- #4: We started with the problem Ruth faced needing to get to appointments but lacking transportation Our first hypothesis was that clinic managers wanted to… We also had cfo’s at insurance companies also wanted to get these … avert costs
- #5: We did our homework None of us were experts in transportation so we trusted the first things that we heard Many patients miss appointments due to transport Costs 25B We thought we had identified a real need
- #6: Get out of the building We spoke to fourteen clinic managers Are no shows a problem and is transportation a reason At this point we had blown up This is when stake in the ground (hypothesis) Looking for a customer and a value prop -- our mentor Nancy just said to “put a stake in the ground”
- #7: So then we pivoted At this point we wanted to test - can we help transportation providers But then we talked to 7 transportation providers and none of them wanted - small businesses that are cash strapped
- #8: So we pivoted to look at insurers as the customer segment, because they have money and many were currently offering rides to the doctor to their members We learned that members who had bad experiences with these rides would often rate the overall insurance company poorly So we thought we could help insurers improve the member experience with ancillary benefits like transportation, meals, and others.
- #9: Two insurers told us they wanted to measure which service providers were providing good or bad experiences to their members Kaiser told us that member satisfaction goes into their government rating and influences $1B of government funding. Wow.
- #10: We had a fantastic opportunity to go out and talk to a lot of insurers and show them this MVP and hear about their needs.
- #11: And what we learned is that... Insurer companies don’t want to measure satisfaction Because if they find problems, they’ll have to report it, their plan rating might go down Lesson in healthcare: what people say they want and what they actually want can be very different At this point, we had pivoted 2 in 4 weeks
- #12: From here, we talked to to 6 insurers and the common theme was connecting their insurance members to social services!
- #13: We were really interested in this need and pivoted to help insurers connect patients to social service orgs dealing with services such as housing, meals or transportation. This connection of patients to social service known as the referral process! And we had a daunting journey in front of us: How this messy process works in order to find our value prop Map how money flows in the business Sell our solution! --- As we hit pretty much it this pit, we started to then focus on interviews where it will be challenges that an insurer will have but will also be willing to pay. We looked a bit into more literature and experts on more macro trends in healthcare. There have been growing major changes in the space of social determinants of health where non-medical services such as meals, housing, and also transportation play a major factor in a person’s health. A segment of insurers, Medicare Advantage Organizations have started transitioning to work on the value-based models which focus on outcomes instead of volume of appointments and have looked into this. One major pain point we then keep hearing from not just one but multiple stakeholders from providers, patients, and insurers is this referral process. The referral process is for transferring patients who need social services over to the community service providers.
- #14: In the beginning, we thought the referral process looks something like this: Before in the video, we mentioned Ruth who needs transportation service. In the referral process, someone in the insurer, known as the case worker that takes care of Ruth’s medical case, identifies her social need, and calls Ruth to enroll her in a transportation service which she can then just get access to immediately. We assumed that the process would just have one of case workers in the insurer calling up the patient to enroll him/her for an appointment in a social service organization and the patient can just go get the social service they need --- As we hit pretty much it this pit, we started to then focus on interviews where it will be challenges that an insurer will have but will also be willing to pay. We looked a bit into more literature and experts on more macro trends in healthcare. There have been growing major changes in the space of social determinants of health where non-medical services such as meals, housing, and also transportation play a major factor in a person’s health. A segment of insurers, Medicare Advantage Organizations have started transitioning to work on the value-based models which focus on outcomes instead of volume of appointments and have looked into this. One major pain point we then keep hearing from not just one but multiple stakeholders from providers, patients, and insurers is this referral process. The referral process is for transferring patients who need social services over to the community service providers.
- #15: Reality is the referral process looks something like this, a convoluted and manual process. Today, someone from the insurer will call the patient, first figure out what social needs, transportation, housing or food, they have, then they call multiple service providers, play phone tag with them and have back and forth conversations. And social service org will then call the patient to set up appointment and have more phone tag. Its a ton of work for the case worker at the insurance company and members often don’t get connected to the service they need.
- #16: Reality is the referral process looks something like this, a convoluted and manual process. Today, someone from the insurer will call the patient, first figure out what social needs, transportation, housing or food, they have, then they call multiple service providers, play phone tag with them and have back and forth conversations. And social service org will then call the patient to set up appointment and have more phone tag. Its a ton of work for the case worker at the insurance company and members often don’t get connected to the service they need.
- #17: Reality is the referral process looks something like this, a convoluted and manual process. Today, someone from the insurer will call the patient, first figure out what social needs, transportation, housing or food, they have, then they call multiple service providers, play phone tag with them and have back and forth conversations. And social service org will then call the patient to set up appointment and have more phone tag. Its a ton of work for the case worker at the insurance company and members often don’t get connected to the service they need.
- #18: Reality is the referral process is a ton of manual and convoluted work. Today, someone from the insurer will call the patient, first figure out what social needs, then call multiple transportation providers, play phone tag with them and have back and forth conversations. And then the service provider will then call the patient and play more phone tag to enroll them in the service and coordinate the time. Its a ton of work for the case worker at the insurance company and members often don’t get connected to the service they need.
- #19: Based on our mappings, we then updated our value proposition For our value prop: 1) we learnt that we can scale insurer’s caseworker efficiency by targeting the manual process for referrals 2) decrease medical costs by improving health outcomes through enabling better access to social services for patients
- #20: We went out of the building to learn more about local service service organizations by building a second MVP to do the referral process ourselves We met Eddie at the Palo Alto library who needed help with housing. So we decided we could help him connect with a housing assistance program, a social service organization We expected it to be hard but it was really hard to get in touch in housing organizations for Eddie and get follow-ups from these organizations. We then realized that having a quality social service organization as our key partners is very important in this referral process. ---- , and can’t get follow-up Patients didn’t always follow-up with social service organizations
- #21: For our key partners We solidified social service orgs as We realize that to improve this referral process, we need to build an engaged network of social service organizations that can provide timely and quality service to patients
- #22: At this point, we realized we have identified the value proposition and start looking more into how we can save case workers time. It turns out that case workers would love a digital referral platform as currently, it can take 2 hours to even refer a single patient. --- We decided that we could simplify the referral process in which a case worker connect a member to a social service provider - like housing, meal vendor, transportation more seamlessly.
- #23: So we set out to mock up an MVP to save case worker’s time from this current manual workflow. Now, once the case worker at the insurance company has identified which needs the patient has, they go onto Merity and select a recommended provider and make a digital referral. Instead of playing phone tag, the service organization accepts the referral, can initiate the enrollment process and reaches out to the person to initiate service. --- We started showing this to a lot of insurers and we found that this would save case workers time and help patients get the services they needed. And the most important services to connect to are housing, food and transportation. We work closely with curated list of social service organizations to build deep integrations
- #24: Thrilled to learn insurers would pay $1-4pmpm 50,000 members -> how much that is a month (potential contract size). We’re talking about big numbers! --- As we hit pretty much it this pit, we started to then focus on interviews where it will be challenges that an insurer will have but will also be willing to pay. We looked a bit into more literature and experts on more macro trends in healthcare. There have been growing major changes in the space of social determinants of health where non-medical services such as meals, housing, and also transportation play a major factor in a person’s health. A segment of insurers, Medicare Advantage Organizations have started transitioning to work on the value-based models which focus on outcomes instead of volume of appointments and have looked into this. One major pain point we then keep hearing from not just one but multiple stakeholders from providers, patients, and insurers is this referral process. The referral process is for transferring patients who need social services over to the community service providers.
- #25: We set out to understand how referrals work --- As we hit pretty much it this pit, we started to then focus on interviews where it will be challenges that an insurer will have but will also be willing to pay. We looked a bit into more literature and experts on more macro trends in healthcare. There have been growing major changes in the space of social determinants of health where non-medical services such as meals, housing, and also transportation play a major factor in a person’s health. A segment of insurers, Medicare Advantage Organizations have started transitioning to work on the value-based models which focus on outcomes instead of volume of appointments and have looked into this. One major pain point we then keep hearing from not just one but multiple stakeholders from providers, patients, and insurers is this referral process. The referral process is for transferring patients who need social services over to the community service providers.