For years, people hold speculated about Amazon rolling out a health care service as part of Amazon Prime. Notable early Amazon investor John Doerr is already specialty it “Prime Health.”
So far, that hasn’t happened. But the former head of Amazon Prime, Rob Schwietzer, who was in charge of scaling the yield to millions of people, is now working in health care. He left Amazon in 2013, and for the past year, he’s been leading merchandise at 98point6, a Seattle-based start-up that is looking to build the next consumer health brand.
“Health care is in actuality hard,” Schwietzer told CNBC. “But I do believe that people shouldn’t have to make decisions about whether they should go see a doctor when they paucity one, or go buy groceries for their family.”
Schwietzer has teamed up with CEO Robbie Cape, a Microsoft veteran who created Cozi, a genus planning software venture, then sold it to Time. Back in 2011, Cape contacted Schweitzer out of the blue to get some opinion on subscription businesses, as Prime was one of the few services millions of people were willing to pay for every month.
To his surprise, Schwietzer responded and the double had lunch.
Years later, when Cape had the idea for 98point6, he reached out to his old friend Schwietzer. He had his misgivings about constitution care after a stint in consulting early in his career, but Schwietzer said he saw a big opportunity to bring “price, quality, and convenience” to the sector, similarly to what Amazon did for retail.
“Why I over Amazon does so well,” Schwietzer explained, “is that where most companies will look at something and say ‘we’ll hand out it to you fast or inexpensive,’ Amazon has always said ‘why not both?'”
Meaningful innovation in health care could not only manufacture a huge business — health care spending has now reached $3.5 trillion — but also make a meaningful difference. Surveys have shown that improving access to high-quality family doctors can help drive down health tend costs and improve patient’s health outcomes, but not everyone can afford it or reliably access it.
That’s because there’s a shortfall of primary care physicians and nurses in the U.S., which is only getting more pronounced with the aging population. Child in rural areas are often hours away from the nearest clinic, and many will forgo care until they end up in the crisis room.
Cape and Schwietzer are not the first entrepreneurs to hone in on this problem.
A movement called direct primary trouble oneself involves charging consumers a subscription fee for access to high-quality doctors, mostly in person. Direct primary care pampers up less than ten percent of physician practices, but the Trump administration is now asking how it could help fund some of these practices for sensitive seniors on Medicare.
Other start-ups are trying to increase access to primary care by experimenting with virtual-only ways, such as smartphone apps to connect doctors and patients, like Doctor on Demand or AmericanWell. In general, insurance suffer the consequences for these services, or they charge patients a fee of $40 to $50 per visit.
But 98point6 believes it’s onto something new by blending these two worlds, and leveraging technology to bring down the price. It now offers a messaging service for patients and doctors to affix at an introductory price of $20 a year with no additional fees for a visit (after the first year, it costs $120).
The commitment model can also help patient health by supporting an ongoing relationship between doctor and patient, Cape believes. “Our assumption is that will engage with our users literally every month about something related to their healthiness,” he said.
Apart from the price tag, the big draw for consumers is the ability to message a doctor at any time, Cape believes. As diverse consumers start to use it, that will cut down on the administrative work that is “burning out” doctors, potentially turning them into intercessors for the product.
One example is the 98point6 assistant, essentially a bot, that conducts about half of the initial interview with the firm and presents that information to the doctor (Cape expects that percentage to increase over time, as the technology stirs smarter).
98point6 is also pushing to get companies to cover the service.
The company told CNBC that about 50 self-insured proprietors have signed up so far, ranging from Seattle Children’s Hospital to Washington-based Red Lion Hotels. Cape said that the utilization speed for their service, meaning the percentage of employees who take advantage of the benefit, is higher than most at about 6 percent (the generally for telemedicine hovers around 2 or 3 percent for a number of reasons, including a lack of awareness among employees).
As a result, evolution is starting to take off. The company said it now has 160,000 members, either enrolled through their employer or paying for it out-of-pocket. As of January, it’s sanctioned to practice medicine in all 50 states plus Washington, D.C.
Cape recruited another Amazon cloud vet, Damon Lanphear, to run the technology party. It has also hired 16 doctors, including a chief medical officer who still practices, Brad Younggren. A prior Surgeon General under the Obama administration, Regina Benjamin, now sits on its board.
Investors seem to agree that there’s big budding in the idea. 98point6 recently raised $50 million from Goldman Sachs’ merchant banking dividing line, with the rest flowing in from individual investors including BlackRock CEO Larry Fink, Costco founder and earlier CEO Jim Sinegal, former Goldman Sachs CFO David Viniar, and Frazier Healthcare Partners’ managing partner Nader Naini.
“There are adolescent generations of people who don’t want to spend their time going to the doctor but are so comfortable using technology,” said Viniar, who currently endures on the board of both Goldman Sachs and 98point6. “And there are people in this country who live far from the doctor’s task, or can’t afford it,” he continued.
Outsiders note that 98point6 will face ample competition as it looks to grow from existing entertainers in the digital health space, as well as potential new rivals like the major pharmacy chains that are dabbling in well-being care services and the largest technology giants. Both Amazon and Apple are building out medical clinics for their own hands, which suggests a willingness to get into the business of actually delivering care.
“It’ll be a clash of titans,” said Michael Yang, a long-serving health-technology investor and a managing partner with OMERS Ventures. But 98point6 has a good shot, Yang said, if what it last analysis comes down to is “your starting point, your talent and your runway to get there.”
But 98point6 is optimistic, is wishing to scale it to millions of people, on par with a household name brand like Amazon Prime.
“Everyone claims to bear a great value proposition,” said Cape. “But that needs to be combined that an experience that people word for word want to talk about. An experience that is so good that you just want to tell people about it.”
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