How does DocGo make money?

Steven Loeb · November 16, 2022 · Short URL:

The majority of revenue once came from transportation services, now it comes from in-home care

Transportation still remains one of the biggest barriers to people receiving the care they need: as of 2017, over 3 million people in the United States were not getting the medical care they needed due to transportation issues such as lack of vehicle access, inadequate infrastructure, long distances and lengthy times to reach needed services, and transportation costs.

While telemedicine has certainly helped close some of these gaps, making it so that not everyone needs to take a journey to see a healthcare professional, there are still plenty of cases where in-person care is necessary, either in the home or in the doctor's office.

That's the gap being filled by DocGo, providing of last-mile mobile health services and integrated medical mobility solutions.

"DocGo’s Mobile Health bridges the gap between telemedicine visits and in-person treatments by fully integrating with industry-leading EHR providers to enable seamless care logistics. Our AI-powered transportation and concierge medical services enable our clinical professionals to facilitate high-quality patient-centered care, helping improve patient outcomes while reducing the total cost of care for our customers," the company says on its website.

The company, which was known as Ambulnz until its SPAC merger in 2021, started out as a provider of both emergency response and non-emergency transport services, including ambulance transports and wheelchair transports. These services are enhanced with technology, such as real-time vehicle location and estimated arrival times. 

Revenue for the company's Transportation Services segment is broken down into trip-based and leased hour based revenue: trip based revenue is made via a fee per trip, which is comprised of a base rate (typically referencing a contracted fee schedule) and a per mile rate. With leased hour arrangements, payments are made on an hourly basis for availability of vehicles and personnel.

As recently as 2020, transportation was still the company's primary source of revenue; it made $63 million from this sector in 2020, representing 67% of revenue, compared to $31 million, or 33% of revenue, for its mobility services, which consist of its TeleHealth Plus solution.

Through TeleHealth Plus, DocGo works with licensed practitioners, allowing patients to get non-emergency medical services including testing, vaccinations, bloodwork, IV hydration, wound care, mobile imaging, and EKGs, done in their home or workplace. The company employs a staff of more than 1,700 paramedics and EMTs.

Revenue for Mobile Health services is based on contractually established relationships with states, municipalities, businesses and healthcare providers; revenue is generated either on a per hour or per event basis. 

"The number of billable hours per day is based upon the anticipated aggregate level of staffing, which is driven in turn by the number of markets in which DocGo is operating. The rate per hour is a blended assumption, based upon the types of personnel used to provide these services, and the rates that are negotiated with customers for these personnel and, in certain instances, for other assets used in the provision of services, such as vehicles," the company wrote in its SEC filing.

"The number of events per day will be determined by the number of markets in which DocGo operates, as well as our success in obtaining such contracts. The rate per event will be a contractually negotiated amount."

In 2021, revenue for mobility services exploded, growing over 600% to $234.4 million, or 73.5% of total revenue. Transportation services, meanwhile, grew 33% from 2020 to $84.3 million in 2021, representing 26% of revenue.

The company attributes this shift to mobility services becoming the company's biggest revenue driver to "the expansion of the services offered by this segment in 2021, with growth accelerating throughout the year, as DocGo increased both its customer base and geographic reach."

In addition, the company saw, "the extension of certain key contracts as well as significant new contract wins," in 2021; DocGo currently has partnerships with Fresenius Medical Care, Jefferson Health, UCHealth, and RXR Realty.

DocGo went public in November 2021, and is now trading at $7.69 a share. 

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