If there is one area that needs cleaning up, it’s the payment side of medical bills for medical practitioners. With insurance, hospitals, and patient’s personal finances all involved, there are moving parts you don’t want moving and the likelihood of something going wrong is nearly inevitable. Instead of relying on older methods, NYC startup Medpilot should be on your radar to ease the process. With the company’s platform, practitioners educate patients on what is actually happening instead of hiding behind a bureaucratic veil that covers the fine print. In addition, the platform takes care of all the essential aspects of billing including all of your balance inquiries!
We touched base with cofounders Jake Myers and Matt Buder Shapiro to learn more about what inspired the company as well as the some details of this most recent funding.
Who were your investors and how much did you raise?
MedPilot raised $750K in seed capital. The round was led by Tom Hirschfeld, a strategy advisor for Halcyon Asset Management and active angel investor, Hudson River Capital Partners, as well as other healthcare players, like Blueprint Health.
Tell us about your product or service.
MedPilot is a tool designed to make healthcare billings & collections departments more effective and efficient. Our software uses data science and behavioral targeting to recommend patient engagement methods, personalize communications and resolve outstanding balances. MedPilot’s analytics reporting can also increase the productivity of in-house & third party call centers.
What inspired you to start the company?
It wasn’t long ago that hospitals used to be able to cover their expenses by just focusing on collecting from insurance companies. Times have changed. The Kaiser Family Foundation reports that average annual out-of-pocket costs per worker rose almost 230 percent between 2006 and 2015, based on its annual survey of employer health benefits coverage.
On the flip side, healthcare billing providers are still trying to learn how to adjust their model to assist patients with understanding their bills and encouraging accountability. Patient satisfaction surveys now play a key role in providers receiving reimbursements. As the healthcare industry continues to evolve, it becomes increasingly important that we find an efficient and low-friction solution to collecting on patient balances.
How is it different?
Our expertise in direct marketing allows us to bring a data-driven approach to patient engagement. We leverage user demographics and behavior, as well as performance analytics, to provide communication channels and customized content that connect patients securely to the billing process. We believe that in order to maximize collections and minimize patient frustration, you must optimize the performance of your outreach.
What market you are targeting and how big is it?
The two segments of the healthcare market on whichwe are focused are outpatient facilities (radiology and endoscopy centers, lab, urgent care, etc.) and third-party billing and collection companies.
The patient debt collections market for healthcare is $4 billion, and NerdWallet Health estimates almost one in five American adults may be contacted by a debt collection agency about medical debt in 2014.
What’s your business model?
We are currently working with both healthcare providers and third-party billing and collection companies. We offer both a transaction fee model, and a subscription model, based on the client.
You just landed key partnerships and some new clients. Would you mind telling us about it?
We are very fortunate to have landed a partnership with Retrieval Masters, one of the leading collection agencies, which handles over $1B a year in outstanding bills. They’re working with us to kick in before debt services typically become involved, and they are focused on bringing a tech-forward and patient-friendly approach to the industry. There are many clients in need of an option to outsource all patient billing and collections. We are now able to provide that service.
On the client side, we are excited to be piloting with Dr. Thomas Brown’s “Kathy’s Urgent Care.” Dr. Brown provides exceptional quality care and always puts the patient first. We are eager to have the opportunity to begin using our software to help his patients understand and pay their medical bills with ease.
What was the funding process like?
It’s never easy raising money for an early stage venture. However, going through Blueprint Health’s accelerator program gave us the tools to succeed in fundraising and helped us with our sales strategy. It’s important for startups to understand that the capital raising process won’t happen overnight. Stay focused and don’t ever let it distract you too much from executing. The funding process will go much smoother if you succeed at running your business.
What factors about your business led your investors to write the check?
I think the biggest factor that led our investors to get involved was the range of skills our team brings to the table. Our expertise in revenue cycle management, software development, and direct marketing gives us the ability to bring innovative ideas to the patient collections space.
What advice can you offer companies in New York that do not have a fresh injection of capital in the bank?
Network, network, network and network some more. Your next investor could be someone you speak with at a tech meet up or a bar mitzvah. You never know from where the next flow of capital will come, so talk to as many people as you can. Also, make sure your team is lean and keeps costs at a minimum so you can easily pivot and optimize your product with incoming market & investor feedback.
Where do you see the company going now over the near term?
We are 100% focused on executing with our new partnership and first clients. We’re going to spend our time and resources analyzing our initial results so we can optimize our product and offerings moving forward.
Where is your favorite bar in the city for an after work drink?
We utilize the Soho House every chance we can get for after work drinks and meetings. Hard to find a better rooftop in NYC.