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Castlight hopes new drug shopping tool is “stepping stone” to more health care consumerism

Ki Mae Heussner — Wed, 20 Mar 2013 13:00:04 +0000

When it comes to shopping for prescription drugs, you likely know that generic is cheaper than brand-name. But there are other ways to save costs on pharmacy spending and, with its new tool launched Wednesday, Castlight Health hopes consumers won’t just be more cost-conscious about buying their meds but proactive when it comes to all of their medical purchases.

The San Francisco-based company, which provides employers with health cost comparison products, said its new pharmacy tool is meant to help users shop for the best prices on their prescriptions. It allows them to search across different variables, including pharmacies, mail-order, generic/brand, quantity and other factors.

According to Consumer Reports, the average American spends $708 out-of-pocket annually on pharmaceuticals, and Castlight says people make drug-related purchases three times as often as they go to the doctor — so savings on pharmacy costs aren’t insignificant. But Ethan Prater, Castlight’s vice president of product, said that while cost savings was a factor, a larger goal of the product is to encourage consumers to be more engaged when it comes to shopping for their health care services and products.

“It’s a stepping stone to broader healthcare consumerism,” he said.

Pharmaceuticals comprise just 15 percent of what employers pay in healthcare costs. But if being mindful about drug costs helps employees become more savvy about general health care costs, the savings could be meaningful to employers and employees.

As health care costs rise and employers shift to high-deductible health plans that require their employees to bear a greater share of health care costs, companies like Castlight are trying to boost transparency and bring a new wave of consumerism to health care. Castlight, which has raised $181 million in venture capital and is believed by many to be the next digital health company to go public, is a leader in this space. But other companies addressing transparency issues in healthcare include ClearCost Health, Clear Health Costs and HealthInReach.

With Castlight’s mobile app, users can search from their doctor’s office to see if a less expensive therapeutic alternative (or drug in the same class) exists for a medication recommended by a doctor. Other savings could come from mail-order sites or pill-splitting, Prater said. While not all employers support the practice of buying larger, possibly cheaper, doses of a medication and then splitting it into the prescribed amount, Prater said that for those that do, Castlight provides the option. The tool also alerts users when it spots opportunities for cost savings.

Castlight, which counts companies like ConAgra as customers, says it works with employers who collectively cover 3.7 million people.

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Priceline for health? PokitDok launches on mobile

Ki Mae Heussner — Fri, 21 Dec 2012 21:18:48 +0000

Comparison shopping is commonplace when it comes to buying airplane tickets, electronics and other big ticket items. But a growing number of startups are trying to make it easier to bring that practice – and mentality — to healthcare.

One of the newer cost-conscious startups, PokitDok, launched a mobile app this week that lets consumers search for providers in their area, compare options and even attempt to name their own price.

As my colleague Om Malik tweeted this morning, it’s not so unlike a “Priceline for health” that lets you get quotes directly from providers in search of one that matches your budget.

“Not everyone is going to give you what you want,” said co-founder and CEO Lisa Maki. “But just like on Priceline, [consumers] can get a little more information and providers, in a secure channel, may be willing to give you a better price.”

Launched by Maki after her own frustrating experience with the healthcare system, PokitDok provides a web-based community and marketplace for health and wellness. On the site, people can communicate directly with physicians, personal trainers, massage therapists and other specialists, as well as purchase health products and treatments. In July, it opened in beta and raised $1.3 million in seed funding.

Search for providers, name your price

The app released this week is intended to complement the website, Maki said, and give people an on-the-go way to search for local providers and get prices.

Say you want to find an acupuncturist in San Francisco, through Pokitdok you can scroll through a list of practices and request a quote by indicating your budget, payment method, your health needs and the kind of practioner you’re looking for. Within 72 hours, PokitDok said, providers will respond with a price.

As of now, PokitDok’s community includes one million health and wellness providers nationwide, some of which have opted-in directly to the site and some of which are listed thanks to a licensing deal with a secure database of national physicians and healthcare practioners. The company declined to share its number of users but said they’ve seen strong, organic growth from consumers nationwide. Given the newness of the app, early downloaders won’t see many reviews left by other users but as more consumers join the marketplace, Maki said, the goal is for users to not only benefit from the price quotes but the information provided by peers.

Startups bring comparison shopping to health

As healthcare costs climb and employers increasingly shift to high-deductible health plans to keep their own costs down, Maki said PokitDok is intended to give consumers a way to find the cheapest prices. Those with high-deductible plans or no insurance at all stand to benefit the most from a financial perspective, but even those with insurance and lower-deductibles could be helped as well.

On the provider side, she said, many doctors are willing to give patients better deals if they’re paying out of pocket or through an HSA (health savings account) or FSA (flexible spending account). PokitDok helps them overcome the challenge of finding those patients.

It’s not the only startup trying to bring transparency to the black box of healthcare expenses and the growth in these kinds of companies is obviously a boon to consumers. HealthInReach is another direct to consumer site that lets people search for providers and find online deals for services. It targets the uninsured and those paying out of pocket and negotiates deals with the providers. Castlight Health and ClearCostHealth are a couple of other comparison shopping services for healthcare made available to patients through their employers.

Since raising its seed round this summer, Maki said PokitDok’s team has grown to include 11 full-time staffers, including Eric Baily, the former creative director for the healthcare practice at Frog Design and Bryan Smith, who previously served as senior data scientist for Idle Games.

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Intel’s Andy Grove sounds off on data transparency in healthcare

Ki Mae Heussner — Tue, 16 Oct 2012 22:43:03 +0000

Andy Grove, the legendary and longtime CEO of Intel, wants to light a fire under healthcare providers and patients.

In an article in the latest issue of Wired magazine, he argues that, in healthcare, “1950s-era thinking still rules the day, and irrational and inexplicable pricing is routine.”

“The health care industry plays a gigantic game of Blind Man’s Bluff, keeping patients in the dark while asking them to make life-and-death decisions. The odds that they will make the best choice are negligible and largely depend on chance. Patients need to have data, including costs and their own medical histories, liberated and made freely available for thorough analysis. What health care needs is a window sticker—a transparent, good-faith effort at making prices clear and setting market forces to work,” he writes.

Grove’s interest in healthcare isn’t new. Over the past couple of decades, after being diagnosed with prostate cancer and later Parkinson’s disease, he has not only invested millions in research, but supported a an innovation-minded graduate health program and become an impassioned advocate of reform.

In his latest piece, he says that healthcare costs have climbed, even as technology in the field – which typically drives efficiency – has advanced.

Entrenched biases among doctors and policy-driven investment patterns are partly to blame, Grove argues, but he adds that consolidation among healthcare providers only exacerbates the situation by further hindering data transparency.

What’s needed, he explains, is a “digital sticker” reminiscent of the so-called “Monroney stickers” glued to the windows of new cars.

Startups like Castlight, Simplee, CakeHealth and others are beginning to bring more price transparency to consumers by helping them comparison shop for healthcare providers and breakdown their medical bills and insurance claims into more understandable charges.

But Grove envisions new tools, reliant on computers developed explicitly for this purpose, that are even more comprehensive and provide information in real time. That will only happen if the healthcare industry, led by doctors, changes its mindset, he said, but the role of the patient is also critical.

At the Wired Health Conference in New York Tuesday afternoon, Grove spoke with Wired executive editor Thomas Goetz via Skype and, when asked where that motivation for change will come from, he simply replied: “From you and I being sufficiently pissed.”

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