Shopping for Health: Healthcare Marketplaces

With an endless number of options from providers to health systems, to specialty clinics, and more, healthcare has become increasingly complicated for patients.

Healthcare is notoriously one of the most difficult industries to navigate for the consumer. There is no front door, no one stop shop, and the market continues to fragment. Finding a doctor is difficult, finding one that takes your insurance is even harder. Traditional marketplaces for healthcare have been hard to build, scale, and navigate with the complexities of the healthcare system, but there is a massive opportunity to build the next unicorn in this space. There have already been some success stories like ZocDoc and Teladoc, but even these have had their struggles. Whether it’s a product of the complexity of the US system, or healthcare as a whole, the broader industry shift towards consumer-driven healthcare will seemingly create many opportunities for companies to dominate the space and earn brand loyalty by prioritizing the consumer experience.

There is a significant opportunity for a healthcare marketplace that simplifies the process of finding and paying for healthcare services which comes down to improving access to care. Patients are constantly searching for platforms that integrate provider reviews, scheduling, insurance verification, patient communication, clinical data collection, and price transparency, so there is an opportunity for an all-in-one solution for finding care increasing accessibility and affordability. Successful marketplaces will offer deep supply-side services, benefiting both providers and consumers by reducing costs and increasing access. Current insurance dynamic allows payers to maintain networks of providers but does not help consumers find the right provider for them or carry out the necessary steps to get treatment. Many clinicians are burnt out from working in hospital systems or clinics and want to start their own practice but require the infrastructure, referral pathways, and insurance credentialing that a healthcare marketplace can provide.

What makes building efficient healthcare marketplaces especially complicated is the multiple stakeholders involved in healthcare. What we like to call the 3 Ps, patients, providers, and payers all have vested interest in how healthcare is delivered and paid for. Patients want access to a wide range of services that meet their needs without breaking the bank. Providers are under pressure to deliver better patient outcomes while controlling costs. And payers need to ensure they are providing quality care at reasonable prices. Healthcare is extremely fragmented and must work within an increasingly complex insurance system. The lack of price transparency and strain on supply of providers has proven a huge barrier for the successful establishment of healthcare marketplaces.

There are many challenges within healthcare that make marketplace models complicated. Collection and maintenance of consumer data and qualification of patients, interoperability issues, data breaches, and costly compliance implementations plague the system. Regulatory complexity from data and privacy to insurance and reimbursement present hurdles throughout the patient lifecycle. On top of all of this, healthcare services are used less frequently than other consumer services making it hard to justify CAC with an often lower lifetime value of the patient. With a successful marketplace, we can ensure the quality of supply, alleviate long wait times for providers, specifically in specialty care, and present transparent pricing to patients.

While there are many challenges, various types of healthcare marketplaces have room to succeed. Increased digitization and emphasis on telemedicine within healthcare make marketplace models easier to develop and supply. Our aging population leading to higher demand for healthcare services and specialty care, the emphasis on personalized and convenient healthcare experiences from longevity medicine to at home bloodwork and pediatric visits, the push for patient’s to be in charge of their health and data, and the shift to value-based care models that focus on outcomes and efficiency all point towards marketplace models being extremely effective in the next phase of our healthcare system. There has also been an increasing specialization within medicine and a shift away from PCPs and towards specialists by patients, especially in the fields of women’s health, mental health, auto-immune, and longevity, that are well suited for marketplace offerings.

Today, some of the largest digital health companies offer general physician marketplaces but lack many crucial features that would solve many of the current problems like price transparency, clinical data collection, and more. ZocDoc is probably one of the largest with doctors across 250 specialties and more than 18,000 insurance plans but is more of a Yelp for healthcare versus a full-service marketplace. Wheel is another company aiming to provide the infrastructure and nationwide network to patients as well as virtual care on the platform but has struggled in recent years. There are a number of mental health marketplaces, such as Rula and Headway, that both provide the services and provider network that are often difficult to access in this specialty. The world of nutrition has also exploded recently, given the rise of GLP-1 usage, and has seen a number of companies like Fay and Nourish raise millions from investors to provide nutrition coaching and infrastructure on demand. Bitewell is another marketplace like product that acts as a digital food pharmacy and food as medicine platform to help individuals access healthier food options.

On a slightly different note, there are also a number of marketplace models that exist outside the traditional walls of healthcare but serve similar purposes. Labor and talent marketplaces within healthcare have been around for decades and have benefited from the labor shortages of healthcare professionals in recent years. M7 is a nursing workforce management platform that leverages preference data from staff to guide leaders in making fair, transparent, and cost-effect staffing decisions. TrueMed is a platform started by Calley Means that allows brands and consumer to utilize their HSA/FSA accounts for health and wellness by curating a marketplace for eligible products and services. And to wrap it up, as we’ve talked about many times, the age of longevity medicine is here and with it have come many marketplace platforms, such as Bloomy and Workup, attempting to consolidate the fragmented and over saturated market.