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The company has added Care Advocates who negotiate lower costs on the member's behalf
CrowdHealth is a company that to wants to be the anti-health insurance company, deploying a crowdfunding model to pay its users' medical bills, thereby lowing the cost of care. Since it's paying cash for all of its procedures, it gets price discounts that are about 30 or 40% off of what health insurance plans pay for.
It's a payment method that has caught on with both members and with investors: the company announced a $6 million Series A round of funding from Next Coast Ventures and Activate Venture Partners on Thursday. This is its first fundraising since it raised $6 million at its launch in September 2021.
"We’ve made incredible progress with thousands of new members having signed up. Our most significant accomplishment though is that we are getting incredible prices on large healthcare procedures. For procedures over $1000 we have helped our members save 72%," Andy Schoonover, CEO and founder of CrowdHealth, told VatorNews.
CrowdHealth members users pay a flat monthly fee, after which they pay $500 per health event, all of which is used to help pay for other member's procedures.
When a user is going to the doctor, all they have to do is tell the company when they're going and who they're seeing; while wellness checks, such as a primary care physician, OBGYN, or pediatrician, are completely covered without any additional payment required, if the user needs a follow-up with a specialist, such as surgery, the company can negotiate directly with that hospital or provider prior to the operation, and get the price lowered. CrowdHealth will even pay the bill before the patient ever gets to the doctor's office.
For example, Anthem Blue Cross Blue Shield is the big insurer in Cincinnati, Ohio, and they pay about $40,000 for a knee replacement. With CrowdHealth, the company will move the procedure from a hospital to a surgery center, which will lower the price by over $10,000.
CrowdHealth members also benefit from dynamic pricing, meaning that, for most users, their maximum contribution will be $175 per month, which includes a $40 platform fee, and then $135 that goes into the contributions to the community, but the amount per month will depend on what needs to be paid out to the community.
Since its launch, the company has added Care Advocates to its platform, who coordinate with doctors and hospitals to negotiate lower costs for medical bills on behalf of members.
"Everyone hates the impersonal nature of health insurance. You call into a call center and have to explain your, oftentimes, personal health issue. They transfer you to another person and you have to repeat yourself," Schoonover explained.
"We wanted our service to be totally different than health insurance in all ways so we built a system that enables members to talk to the same Care Advocate every time they call. It’s a game changer."
CrowdHealth has also expanded the methods with which members can pay for the service, including a recent partnership with Swan Bitcoin that allows members to redirect a portion of their monthly subscription payment to a Swan account. Going forward, the company plans to introduce other ways to pay.
"We are excited that our members have ownership over their own health and their own money. It no longer has to disappear into a health insurance black hole via premiums. Our members know how much they have contributed and how much is left after crowdfunding. We are all about transparency," Schoonover said.
CrowdHealth plans to use the money it has raised to grow its community and to provide more tools for its members.
"We are preparing for Health 3.0, a personalized approach to healthcare that removes the paternalism of big corporations, and puts the responsibility back in the arms of the patient. These patients will be armed with diagnostic tools that ensure they are taking the right actions in their 30s, 40s and 50s that yield vitality in their 60s, 70s, and 80s," said Schoonover.
(Image source: joincrowdhealth.com)
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