Delivering Precision Medicare With HealthIQ’s Mujal Shah

In this episode of TD Cowen’s FutureHealth Podcast Series, Munjal Shah, CEO and Co-Founder of HealthIQ speaks with Charles Rhyee, Cowen’s Health Care Technology Analyst about empowering patients to make better decisions by using their own health information.

In 2022, more than 28M people enrolled in a Medicare Advantage plan. That number has been growing 8% every year since 2010. But how effective is the industry at placing patients into the plan that best suits their personal needs? HealthIQ aims to start using a senior’s detailed health records to find the precise Medicare Advantage plan that is most personalized to their needs and will best support their health in the coming years, in what the company calls Precision Medicare.

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Transcript

Speaker 1:

Welcome to Cowen Insights, a space that brings leading thinkers together to share insights, and ideas shaping the world around us. Join us as we converse with the top minds who are influencing our global sectors.

Charles Rhyee:

Hello, my name is Charles Rhyee, Cowen’s Healthcare Technology Analyst, and welcome to the Cowen Future Health podcast. Today’s podcast is part of our monthly series that continues Cowen’s efforts to bring together thought leaders, innovators, and investors to discuss how the convergence of healthcare technology, and consumerism is changing the way we look at health, healthcare, and the healthcare system. And in this episode we’ll be discussing the role of health data, and how empowering patients with their own health information can enable better decisions. And in this case, selecting the best Medicare advantage plan to improve healthcare outcomes. In 2022, for example, more than 28 million people enrolled in Medicare Advantage, and that number has been growing 8% plus every year since 2010.

But how effective is the industry at placing patients into the plan that best suits their personal needs? And to explore this and more, I’m pleased to be joined by Munjal Shah, CEO and co-founder of Health IQ which aims to help seniors live more years of good health. And this starts by using seniors detailed health records to find the precise MA plan from over 3000 plans that are out there, that is the most personalized to their needs and will best support their health in the coming years in what the company calls Precision Medicare. Munjal, thanks for joining us today.

Munjal Shah:

Hey, thanks for having me, Charles.

Charles Rhyee:

Yeah, so as I was looking into the company here, it’s interesting that the start of Health IQ is actually tied to your own personal health journey, and would love if you could share a little bit of your story.

Munjal Shah:

Yeah, I’m a serial entrepreneur. This is actually my third company. As I was selling the last one, we actually sold it to Google in 2010, and it was a machine learning computer vision company. We had worked for years on it. The day after we sold the company, I ended up with chest pains and ended up in the ER. And so what should have been one of the better days of my life having achieved this milestone that I had been seeking for so long, ended up at a journey where I realized I had significant health risk, and then went on a journey of just changing my own health. I lost 30, 40 pounds. I’m not a tall guy, I’m 5’6, so 30, 40 pounds on me was a lot and really just learned a ton about diet, nutrition and eventually even medicine.

And that same journey that continued when my father-in-law got diagnosed with something that we had to go, and deal with. My own father got diagnosed with something, my mother got diagnosed with cancer. And just in leading them through all of those journeys, I ended up interacting with the healthcare system a lot more than I had in the past. And it led me to realize some of the need, and the insights that led to creating Health IQ.

Charles Rhyee:

It’s interesting because I think in part of your situation it seemed like it was your persistence to keep investigating issues with yourself that discovered more because given that you are a certain age, and your blood sugar is fine, the doctor say, “Well you’re considered…” The standard of care is of these kind of broad guidelines that are not that specific. And I guess the question is what do you think of standard of care right now given what you had to go through?

Munjal Shah:

The standard of care is that which works best for 51% of people. It’s kind of the definition. And it’s 51% of the people who are in the studies. There’s a lot of data that suggests for example, that South Asians like I am end up with heart disease about a decade sooner, and end up with diabetes about sooner than your average Caucasian does. And so the standard of care, A, was designed probably more for a specific ethnicity, and hasn’t been tailored necessarily, although people are starting to modify the standard of care now. But more importantly it’s that which works. I mean there are some medications that only work for 30% of people. They’re actually ineffective on 70, yet they’re the standard of care. It’s just that they don’t hurt the other 70. So, they say, well it works for 30, it doesn’t hurt the other 70, it doesn’t help the other 70, so we’re going to go ahead and put it as one of the mechanisms we use or one of the steps in our treatment process.

But really what you want is you want something that works for you. And I think people have failed to realize just how different everybody’s bodies are, and how they react very differently to different medications, and how their default set point is different. Somebody else could never exercise, and probably never get a heart attack. And some people, if you don’t really take great care of yourself, you have a very high chance of having some sort of incident.

Charles Rhyee:

Yeah, absolutely. And that kind of leave us a little bit about health IQ here. You talk about precision Medicare, but it seems very grounded in the idea of precision healthcare. And so now that everyone’s health records are in a digital form with EHRs, have we started to see the data from EHRs changed the way the standard of care is being set? Is it becoming more personalized in your view?

Munjal Shah:

Yeah, there’s been a lot of good work done on trying to use genetics, and other data to deliver this precision medicine, and to really look at how to treat each patient based upon their needs, and a personalized need, and risk assessment as such. But nobody’s done it for plan selection. And if you think about it, the plan does impact your level of care. It impacts the doctors that are available to you, especially the specialist. It impacts how quickly you can see them. We all know sometimes that waiting three months, six months to see a specialist allowed that disease to progress into a level where now treatment is much, much harder. And so speed does matter, access does matter. In addition, things like this plan requiring pre-authorizations, I actually just recently heard the stat that only that 55% of the time when a carrier denies a pre-auth, the doctor doesn’t appeal it.

And so pre-authorizations also limit access in a way. And so we just said, “Hey, let’s find the right plan.” Let’s find the plan for your disease that gives you the best benefits that… And because of those benefits you’ll seek treatment. Sometimes people on diabetes have a need for orthotics because diabetes can also cause issues in your lower extremities of your foot when it gets advanced. But some plans it’s a $10 or $30 copay. And some plans it’s a 30% orthotics can be $300, that’s $90 for a senior on a fixed income, that’s a lot. And they might not get it, they might just suffer more as a result. And so I think that we have come to realize that nobody’s applied this idea of precision to plan selection. And there are, there’s actually you just mentioned 3000 actually in the latest update there’s 4,000 plans in the country. There’s 43 plans per county on average for a senior to pick from. So there’s a lot of choice out there, and all plans are not the same.

Charles Rhyee:

Yeah. Is that why you started with seniors? So I guess when you’re starting Health IQ, why focus on seniors? And actually through as an insurance broker model?

Munjal Shah:

So, Health IQ is a Medicare Advantage broker. And the big difference of what we do from everybody else is we import the detailed health record of the senior, and use it to figure out which plan to pick. And when we looked at that, we said, “Huh, which market do you apply that concept to?” Do you apply that concept to people under 65? Do you apply that concept… Or trying to pick a plan on the exchanges, right, the ACA exchanges, [inaudible 00:08:13] or do you apply that concept to seniors trying to pick a Medicare Advantage plan? And we realized two things. One, you want to go somewhere where people have a lot of choice, there’s only three plans to choose from. Precision Medicare is not nearly as useful. And second, you want to go to a place where people have something in their health record. If you do it on a fairly healthy 30 year old, I mean what are you going to have?

You’re going to have one prescription that shows that she had an ear infection and an antibiotic for some sinus infection she might have had, and that’s it? Well, you can’t really help them truly pick the right plan because there isn’t enough data about their true health status versus by the time you’re 65, these are the main consumers of healthcare in America. They usually have quite lengthy health records, and health histories, and it’s not just 65 plus probably starts at about 50 plus. But we decided to focus on the 65 plus, because, A, the Medicare market, and B, the amount of data that’s in the health record to allow us to actually forecast correctly.

Charles Rhyee:

Then maybe as just to compare a little bit, maybe talk about the traditional broker model. Obviously, as a senior you go into a broker, and ostensibly they’re there to help you pick the right player. What is it about the traditional model you think that’s really inhibiting patients from finding, or members to find the right plan that suits their needs?

Munjal Shah:

I think that the traditional brokers just don’t know your health history at this level of detail, right? They don’t know… Ironically it’s a relationship cell. 80% of Medicare Advantage plans are still sold across the kitchen table, and sold by somebody who knows the names of your grandkids, has built a relationship with you but not necessarily truly understands your health needs at a detailed medical level. And so we’ve been able to do that and say, “Hey, look.” You want the broker to know, and you don’t always want to have to tell them. If you’re a senior and you’re having incontinence issues, that’s not something you want to bring up. But if they can just know it, and see it, and say, “Hey, I think I got to make sure I put this person on a plan with a large OTC card benefit”, which is over the counter things that you can spend at Walgreens and CVS, then they can buy those adult diapers in that case.

And that’s something that the seniors probably never going to tell them just out of embarrassment, but if it’s in the health record they can automatically incorporate that data. So some of it is, but most of it’s just they don’t have it. And then the second part is even if they had it, you’d have to build a tremendous number of [inaudible 00:10:53] AI models to forecast. We don’t just say, “What do you need today?” We say, “What drugs are you going to be on in the next 12 months? What procedures are you going to get in the next 12 months?”

Because you can only change Medicare Advantage plans once a year, but your health might transition during that year. And we want to try to anticipate that a little bit. And your average broker wouldn’t have all the medical knowledge, and the history, and the scientific understanding, and the research paper analysis to say that somebody in stage two rheumatoid arthritis has this probability given these blood markers to transition to stage three in the next year, and require Humira, which is a very expensive drug, and therefore you want to pick a plan where maybe Humira is a little cheaper. We do that level of analysis for our seniors.

Charles Rhyee:

Yeah, maybe talk a little about that, because that was sort of where I was kind of going with… Health IQ, you’re using the patient’s own medical record to not only select the plan, but talk a little bit more about the technology then. And how are you predicting and forecasting potential needs versus obviously everyone wants to make sure their drugs are covered, and their doctors a network kind of thing, but beyond that, obviously what they don’t expect.

Munjal Shah:

So, let’s start. So, first is we import your data and it comes with what are called CPT codes, which are treatment codes. And these are the billing codes that a doctor sends off and says, “I did stitches on Munjal.” That’s a very specific CPT code for stitches on your right arm, or I’m just giving an example here. We look at all your CPT codes, and analyze what procedures you had done, and then we forecast what procedures we think you’re going to have done. So, ooh, you didn’t get that knee replacement last year, but we think you’re probably going to get one this year because we notice your opioid dosage has been going up, you’ve been visiting the pain management specialists a lot. So, we forecast, we look at the present, we look at the future on treatments. We look at your diagnosis codes, which are called ICD codes, your diseases, and conditions, and we also forecast what those are, but we also look at your diseases and say the average person who has these conditions tends to get these treatments.

Maybe you didn’t this year but you might next year. And then we look at both of those against the plan and we’re like, “Oh, this plan has good support for this. This plan allows for cardiac rehab 12 sessions with $0 out of pocket, this other plan doesn’t cover it at all. If you’ve had two stents put in, you might want a plan that has cardiac rehab in case you end up with another more involved procedure down the line.” Even on the things that you mentioned earlier where some of the plans will ask you what medications you’re on, the good news for us is we don’t rely on the senior to have to go to their medicine cabinet and read it kind of one by one and say, I’m on Levothyroxine… Oh, how do you spell that? L-E-V… That’s literally what happens today on phone calls.

And sometimes they forget a med, or they leave off a word, they’ll say, I’m on metformin but not metformin ER, the extended release version. And the extended release version might have a different price or might not, but that’s a good example. We get the exact drug number which allows for almost no data entry error, or no reading error in it. The second is we get all of their doctors, again, allowing for no errors. The average senior today we’re importing 28 current, and past medications. We’re importing on average 16 doctors they’ve seen in the last three years. So even if they had sat there and told their broker, “Hey, make sure my doctors are in a network.” Okay. But they’re not going to remember 16 names. They’ll remember their top doctor, their main PCP maybe, they’ll remember one or two others and then they’ll forget.

They’ll forget their urologist, they’ll forget their interventional cardiologist, they’ll forget their pain management specialists, they’ll just forget some of their other specialists. And then they get in the plan and then they start trying to use it, and then they’re like, “Oh, my god, my doctors are not in network.” Because many Medicare advantage plans are narrow network plans and therefore have a very limited set. And so we analyze all of that. We even forecast what specialist do we think you’re going to see that you haven’t seen yet in the next 12 months? And how many are available in your county? How many are taking new patients? How many are within 10 miles of your house? We truly try to go through as throw an analysis as we can for that senior.

Charles Rhyee:

Two questions. First is, the way you describe it, I mean I wouldn’t have thought there would be that much variation among Medicare managed plans, because the way I understood it, there’s certain defined benefits that they all have to carry, and obviously if it’s a highly rated plan, they tend to use that bonus to give extras into the plan. But it sounds like it’s so diverse among that. How does that occur really?

Munjal Shah:

Yeah, I mean, look, plans do have differences. There’s some areas they have bigger differences than others. Durable medical equipment, we found quite a few differences. That’s things like sleep apnea machines, home oxygen tanks, motorized wheelchair access. And it’s not always necessarily that they have different benefits, but they might have different barriers to getting those benefits. More hoops you have to jump through. We’ve noticed quite a bit of difference in which doctors are in which networks, and that’s a big deal for folks. But there are differences. These plans are constantly trying to differentiate like there’s 43 plans per county. You think they’re all identical. I mean those plans are each fighting for market share from the other plan. What happens each year is they file new plans, and they try to differentiate. They are constantly tinkering with plan design to try to attract more, and more customers in game market share.

And so I think that that’s a constant evolution where they’re constantly changing plans. You can actually change formularies. So what tier a drug it is. There’s four tiers of drug pricing and Medicare Advantage tier one, two, three, and four. And the higher up the tier, the more the consumer has to pay, the senior has to pay, and you can only change plans once a year. But they can change their formularies every three weeks basically.

Charles Rhyee:

Oh, wow.

Munjal Shah:

Yeah, it’s also important to just have a historical analysis on your exact medicines. How many times last year did that plan change the tier of that medication? And so we actually analyze that, too. We call kind of pricing stability if you sense. And so there’s a lot of little nuances like that. And again, remember your average senior on Medicare Advantage makes 30 to 40K a year. For them, a few hundred dollars, a thousand dollars out of pocket is a big number. The average out of pocket bill we’ve estimated on Medicare Advantage is about $2,800 for treatments, and copays, and about $500 for medication out of pocket. So, it’s almost $3,400 a year on somebody making 30/40K, that’s a big deal.

Charles Rhyee:

You talked about all the different ways that the platform and the technology really looks to match that best plan. But if you have 28 different medications, 16 different specialists, and then you also try to forecast who you might need to see, in the end, how well are you able to match somebody to the right plan? I mean, my guess is you can’t get a 100% right.

Munjal Shah:

No. We cant.

Charles Rhyee:

But how close do you get on average?

Munjal Shah:

It depends per person, per county, et cetera. But in general, look, what we do is we just stack rank all the plans. We literally just say the current plan you’re in is ranked number seven in the county. Here’s the plan that’s ranked number one for your needs, for your conditions, for your doctors, for your medications. And that’s what we do. And so that might be still that the best plan only has 10 of your doctors in network, but it’s still 10. Every other plan has less. And we actually show you the sub ranking. So we’ll be like overall rank this plan, this plan, oh, doctor rank this. Oh, drug out of pocket cost rank this. Oh, rank for our rheumatoid arthritis rank two versus that one is rank seven. Okay. So, we actually go condition by condition by condition, get the ranks, and then we calculate kind of an average calculation, and we look at both what we believe will lead you to the best health outcomes as well as save the most money out pocket. So we look at both things.

Charles Rhyee:

And when you survey your members, what are the most things that they really enjoy about the platform? Is it that the sub rankings to be able to kind of go, is it just a simplification for them because you kind of do all that work for them? What is the feedback you get?

Munjal Shah:

We just end up sharing with them, “Hey, ma’am. This is the best plan for you. And here’s a couple reasons why.” People don’t want… The detailed analysis is a lot for most people don’t want that level. And even forecasting future disease transitions they might have, people don’t necessarily want to know that either. You don’t want to be like, “Hey, I think you’re going to transition from stage two to stage three rheumatoid arthritis.” Oh, I don’t want to know that. But we are still doing our jobs, and taking care of them, and anticipating what they might need, and just making sure we’ve done the right analysis to put them in the right plan. But if you look at the seniors, and the interaction, I will tell you the, we get a very positive response right up front when we review things with them. We say, “Hey, it shows you’ve visited these 16 doctors, can we go through them? You still seeing Dr. John? Still seeing Dr. Fred? Still seeing Dr. Shah?”

You just go through it, and they go, “Yes, yes, yes.” Still taking this medication? Yes. Oh, still taking that one? Oh, no, I stopped taking it. It doesn’t work. I hate it. Makes me nauseous all day long. Oh, okay. Did you tell your doctor that? Oh, you probably should. But we’ll go through all that then we’ll go, “You’re still having this condition, you still have this condition, you still have this.” I will tell you by the end of that conversation, what the seniors have come to the conclusion of by and large is, “Oh, my god, these guys really understand my health.” And so while the details of the calculation of what’s the best plan is a bit more detailed than most people want, they definitely are like, “Okay, they get me. They understand my needs. This person I’m talking to has my full health history in front of them”, and therefore what comes next is way better informed than…

What they recommend next is way better informed than anything. So, I don’t know that everybody can comprehend all of the complexities, and detail, but they don’t need to. And then we give them two, or three benefits. We’re like, “Look, this is why this is a good plan for you. Reason one, reason two, reason three, done.” We’ll be like, “Oh, you’re on Levothyroxine for your thyroid, right?” “Yes I am.” “Awesome.” “Do you get dry eyes and dry skin a lot?” “Oh, I do.” “Do you spend a lot of money over the counter on lotions, and eye drops?” I do.” “Well your current plan only has a hundred dollars OTC allowance. This plan I can move you to will give you $300. Will that help you pay for more of the eye drops, and the lotions?” “Oh, that’d be great.” And so we literally tie their needs on their specific conditions to the benefits in the plan.

Charles Rhyee:

And because of that though, do you try to measure the health outcomes of members who pick plans for you, and maybe talk about what some of those outcomes look like?

Munjal Shah:

Yeah, this thing has been running for about a year. It’s still a little early for us to have a true sense of the health outcomes. That would need to be something we do longitudinally over the next two, three years. So, I don’t want to kind of present data that I don’t have yet, in terms of it. We do know that our algorithms predicting the disease transitions are fairly accurate. And the reason, so when we’re forecasting your future needs, we know those are fairly accurate because when we imported all these people’s health records, [inaudible 00:23:16] we typically got three years of health records. So, we built our machine learning by training it on year one, and two, and predicting year three. So, in a sense, we already had a longitudinal data set because how we import the history. And as a result of that, we were able to already break it up into a training set, and a test set to use some machine learning parlance. But we ended up doing that, training it on the two years, and predicting the third year.

Charles Rhyee:

Oh, that’s pretty interesting.

Munjal Shah:

And so we don’t know the total element of what you’re asking, but we know the algorithms are at least forecasting correctly based upon the data we have so far.

Charles Rhyee:

So you’ve been at this a couple years now, maybe talk about the growth you’ve experienced so far, and how you’re thinking about this market as you move forward. Clearly just organically the market is growing. Maybe some indicators of how you’re performing within this market.

Munjal Shah:

I mean, there’s no shortage of people turning 65. 11,000 people a day turning 65. So, no, you’re talking well over almost four million people a year turning 65. So that’s kind of the first part. Second, you have Medicare Advantage’s gaining market share at a very high rate from traditional Medicare, and Medicare supplement. So it is the fastest growing part of the Medicare market on top of that. Third, the government pays for it. So it’s kind of recession proof, and it’s free. 90% of people pay a zero premium. They do pay all these out of pocket costs on the back end if they use services. But the upfront cost is free. So that helps in a recessionary environment. Although most of our customers are retired, so honestly they’re not exactly… Also not susceptible to a recession in the traditional getting laid off sense. And then the government actually increases the commission payouts to brokers by an inflation adjustment every year.

So, in this high inflationary environment, it’s even better for that. So, I think you got a lot of those. We’ve been growing quite substantially. The company’s over a thousand employees today. We were 200 employees back at the beginning of COVID. So just in a couple years we’ve grown a lot, and our Medicare business has grown so much. Actually we used to have a life insurance, and an auto insurance business that we also did some very unique health record importing, and digital underwriting for. But we shut all those down now because the Medicare business is really the place we’ve focused, and the main thing that we’re focused on.

Charles Rhyee:

I would imagine that health plans would actually like what you’re doing, because if you’re fitting the member into the right design, then from the health plans view, that member’s going to be very satisfied. They’re going to run a very positive survey, goes into their star scores, the members probably more adherent, aligned with everything. Is this something that you know go to… Is this something you can speak to plans about, and the benefits of your platform?

Munjal Shah:

We truly believe that if you get the right person to the right plan, both are happy. The plan gets a member, that’ll be more sticky. Most plans lose money on the first year that a customer’s with them. And so they want people. If people only last a year, then they’re constantly losing money. They need them to last year two, year three, with the plan to make up the medical loss ratio deficit that’s there from the first year. We believe that if we get you in a plan that has all the doctors you need, that has all the specialists you need, that has the right coverage you need, that kind of fits your requirements, you’re more likely to stay, frankly.

And so that’s our first kind of thing. Second is we actually help plans with something called their star ratings. Medicare has this one to five star rating system, and if you’re a four or five star plan, you make 5% extra bonus. Now, remember the net income of most of these plans is around that number, 5%. So this doubles net income. In fact, recently Aetna went down in its stars, and if you notice its share… The market cap of what CVS Aetna is a fortune five company, I think? It’s a pretty large…

Charles Rhyee:

It’s definitely up there.

Munjal Shah:

Yeah, it’s definitely up there. And their stock dropped 10% one day on a company that big over just the star ratings because it was a small percentage of the revenue they lost, but it was a huge percentage of the margin. And so this star rating system matters a lot. And the star rating’s made up of two parts, something called a HEDIS score and something called a CAP score. The CAP score is a customer satisfaction survey this year. That CAP score is 63% of the waiting. And do you know what the questions are in there? It’s things like, “Oh, how hard was it for you to get an appointment with a specialist?” Well, we made sure that you got put in a plan that has a lot of specialists available in the exact specialties you need within 10 miles of your house taking new patients without a six month wait.

Great, you’re just going to do better. The carrier’s going to do better because we matched them to the plan that matches kind of the capacity, and the feature set that they have. And there’s lots of other customer satisfaction questions that Medicare sends out in that star rating survey, the CAP score. But there are many ways we can help with that. We also can help with undiagnosed conditions. We’re like, “Oh, Munjal has these three diagnosis codes. He’s missing this fourth, but 95% of people that have these three have this fourth. Maybe he’s undiagnosed for that condition, you might want to check the next time he comes into the doctor’s office, and send a note to the doctor to check for it.” And that helps him in a number of different ways because some of the pricing actually follows. But this is good for the patient, because we truly find undiagnosed conditions that maybe I wasn’t being treated for but I should have been treated for.

Charles Rhyee:

But plans can’t actually… They have to be sort of neutral of the brokers that are bringing members to them. But I’d imagine they would like it if someone, more of their members found them through you, through Health IQ. Because it seems like they would get better fitting members into their plan. Are there any ways you can work more with a plan, or is it really just having more awareness with the plans?

Munjal Shah:

Look, I think they will continue to partner with all the different people that they need to partner with to fill their book. But I think that we hope over time that they will realize that the precision Medicare customers we’re bringing we’re a better fit, we’re stickier, we’re more satisfied, all of those things. And I think we will help to instrument that so that we can show that, where we can show that they have better what’s called 90 day dis-enrollment rates than others. They don’t leave in the first 90 days as fast, and hopefully we will show that their CAP scores are actually higher. You can only do that… You have to figure out how to measure that yourself independently, but we’ll measure that. We’ll send them a survey. It says how hard was it for you to schedule with a specialist? And compare our precision Medicare people to other people, and just be able to kind of analyze that.

Charles Rhyee:

Yeah, that’ll be interesting when you’re able to get that. But healthcare, and personal health though, it isn’t just at that moment, they just set the plan. I mean, obviously, through the course of the year, their health is changing. I think you guys do more than just help someone pick a plan, you got to with them through that year. Talk a little bit about how you help members beyond just that plan selection phase.

Munjal Shah:

After you use our precision Medicare system, some people buy a plan through us, some people don’t. Regardless, we ask you if you’d like to be enrolled in a product we call Medicare monitoring. Think of it as credit monitoring, because we believe that everybody should see a copy of their health record on a quarterly basis at least. We all get a copy of our credit record, and make sure that there’s nothing that untoward happening there. And we believe you should be doing the same thing with your health record. Actually three million people a year are actually the victims of what it’s called medical identity fraud, where I have stolen your identity, and gotten a prescription, typically an opioid, under your name because I had too many prescriptions under my name, ostensibly, because I’m an opioid addict, and I steal your data, and utilize it to basically, the bad actor here takes your data. And utilizes it to get a prescription, and then gets that, and it shows up on your record.

And then when you go to the doctor and you’re like, “Oh, I’m in pain for this.” And the doctor looks in your record and is like, “Oh”, he might not even say it to you. He might just say, “Let’s try a home remedy for this.” Or he might not prescribe you that medication because he thinks you’re an opioid… You’ve got a ton of opioid prescriptions when actually you didn’t at all. And so that could result in you having more pain, and so you should check. And there’s lots of other examples of medical identity fraud.

And so we send you that quarterly update. Here’s your health record, here’s your health record. Oh, wow, this seems to have changed in your health. Can you confirm this? Seems like you know have this whole new need. And then based upon that, if the need is big enough, and if their current plan doesn’t handle it well enough, then we might recommend a new plan for them. But we tend to not to want to do that too aggressively because we know it’s important. Continuity with your doctors and continuity with your plan is important. But if it’s a significant enough change, and your current plan has a significant enough deficit in that issue in treating that issue, then we might actually recommend a change for you. And so we have this constant quarterly email that you get.

Charles Rhyee:

Do you find that that’s the key way to keep members engaged with you? And I guess just before that, what percent of your members elect into the monitoring?

Munjal Shah:

Most. Most who are willing to give us their health record, which a very high percentage of people say yes on the health record, because this is a case where they truly recognize that your broker knowing more about your health is going to help them do their job better. And then after that we say, “Hey, whether, or not you bought with us”, we’re like, “Would you be okay if we keep sending you a copy of your health record every quarter? And we sign you up with this product called Medicare monitoring?” And who says no? It’s free, it’s easy. Of course I want to see a copy of my health record. And so I would say that, that opt-in rate is extremely high.

Charles Rhyee:

Maybe it’s a little too soon, I mean, is the assumption here though, let’s say, for the person that didn’t end up buying a plan through you, but is getting the monitor, is your expectation that next year, “You know what? Hey, I really like this. Let me stick with Health IQ all the way then.”

Munjal Shah:

Yes, that’s exactly [inaudible 00:34:25]

Charles Rhyee:

Something I know that you brought up in some of our conversations beforehand has been the 21st Century CARES Act, and what it can provide in terms of expanding the role of EHR data. Maybe talk a little bit about your thoughts on as the implementation of this act, and what it might mean for the broader healthcare industry?

Munjal Shah:

So, this act was passed in 2016, and it really was about patients rights, and patient access to data. And said every patient has a right to get their data digitally in a file format called Fire, and instantly not like, “Oh, I got to wait a week to get it.” And they basically said by October of 22, all of you have to implement EHR upgrades allowing for this. All the providers and the carriers. And so everybody’s been hard at work on it. And of course that deadline just came last month, and the fines are huge. They’re $750,000 per request if you cannot deliver the data. So, it is a pretty punitive law, which is why they gave so much time to implement it, and for people to get their systems ready. They give them six years to do it, but now it’s here.

And as a result of that, it’s so much easier to get access to your own healthcare data, and then to share it with parties who are going to use it to help improve your healthcare that it’s a bit of a seat change in that data, that data access, that data ownership. Before it was locked up in some electronic medical record system and the only people who could really even access it well were kind of the software vendor that actually made that system. The doctors even were frustrated with their ability to find it. They couldn’t find that somebody had gotten… There’s actually a case, I was talking to an MA plan, and they said, we found that this one patient was on four different blood thinners prescribed by four different doctors that none of the doctors knew that the other doctor had prescribed. And he didn’t know, he just said, “I don’t know. They told me to take the blue pill, and the red pill, and this pill, and that pill, so I take them all every day.” And literally his blood must have been like water at that point.

Charles Rhyee:

I was going to say.

Munjal Shah:

And his risk of a hemorrhage or risk of getting a cut, and bleeding to death would’ve been extraordinarily high, because they weren’t able to coordinate care because he had visited a number of different doctors. And hopefully this helps to address that. And I think that’s part of it. This wasn’t a blue bill or a red bill, this was a bipartisan effort on the CARES Act. Both sides really believed in this healthcare access, and health information access, and it’s really brought a lot more data to light.

Charles Rhyee:

I hear, though, and we hear sometimes, though, that even with this interoperability, there’s still difficulties, because interoperability, you have to have certain APIs to be able to connect, but still there’s a lot of different standards out there. How much more do you think needs to get done you think before we can really see this truly free flowing back, and forth of data?

Munjal Shah:

My guess is a lot. It depends on what you’re talking about. The data we process is mostly all structured. CPT codes are a very structured data set. They do have a bunch of weird idiosyncrasies, and sometimes bugs, but you can work through that. ICD codes are also highly structured. Prescriptions all have a unique prescription number, a unique identifier for that medication. Same thing, there’s a unique identifier for every doctor. What we don’t import a lot of is the doctor’s detailed notes. And if you are building an application that needs that, I suspect that’s one area for sure that there needs to be a lot more work to analyze those notes, and turn them into value, and kind of cross index them against another doctor’s notes.

Charles Rhyee:

If you can get access to that, would you find that, I’d imagine that’d be also helpful to your business, in terms of being even be able to personalize even more, getting more context in [inaudible 00:38:49]

Munjal Shah:

Possibly, but we have so much to tackle already. I mean, remember we are literally the only broker that does this. And so the substitute is a person who knows almost nothing about you except maybe you shared I had a hip replacement last year deer broker, and I still have to get it done on the other hip. So make sure I get a plan where the hospitalization costs are lower. But that’s the most that he might know. I think that we’re already so far ahead in just understanding the healthcare needs at a detailed level that we’ll go to that next level too. But there’s a lot you can do at the structured level.

Charles Rhyee:

Maybe just to kind of finish off here, you started with Medicare, but the health IQ model, I think it should be applicable to the commercial market as well. Obviously to your point earlier that a young 20 year old working probably has very little in their health record, but how would you apply it to the commercial market? And is this an area that a future interest with the company possibly?

Munjal Shah:

Possibly. I mean, we’re not opposed to it. I think that you can do a number of things, but the most importantly, look, there’s always about, even in the under 65 market, there’s about 20% of folks, or so who do have pretty significant health records. And so we would utilize this product to be able to help with that. And they’re buying on the Affordable Care Act exchanges. A lot of those exchanges and plans are high deductible plans. And so they really care about this analysis of what is going to be my out-of-pocket costs on plan A versus plan B. And the same’s true on a lot of corporate side, a lot of corporate plans are high deductible plans and on those plans, you save some money on premium, but you end up having to pay more out of pocket. So again, in those areas, this analysis would be most relevant.

Charles Rhyee:

Would that be an interesting analysis though? Maybe flip it over? Is there a way you could actually sell to employers? Your employees have this kind of risk profile, you’re seeing these kind of doctors, you’re picking this kind of base managed care plan with this network, but it’s not really meeting the needs of your employees, and you might be overpaying, right? Because they’re going out of network, and you’re picking up all this out of network cost.

Munjal Shah:

Yes. I mean I think that is definitely an opportunity to take the same technology, apply it to analyzing corporate plans, and helping their employees pick the right plan. Because most corporations do offer two or three options for their employees to choose between. And even there people are confused, right? They’re like, “I don’t know, should I pick this one, or that?” I mean, if you talk to folks, a lot of them don’t do any detailed analysis. They just pick kind of the plan that’s, “Oh, I hate Kaiser, I don’t like Kaiser. I’m not picking Kaiser.”

Okay, have you ever tried Kaiser? Maybe Kaiser’s right for you? Kaiser’s an option here in California that’s very popular, and it’s kind of an all in cost, an HMO that, yes, you can’t just go see whoever you want whenever you want, but if you follow the procedures, you’re out of pocket costs are really low on Kaiser. My sister had her son, and she calls him the $10 baby because she literally had a baby for 10 bucks, and she didn’t have to pay anything else versus, I remember when we had our children on a normal PPO plan, it was still a couple grand out of pocket for us.

Charles Rhyee:

And the bills just kept coming in, right? [inaudible 00:42:40]

Munjal Shah:

And they did. It was like the anesthesiologist, and oh, but he was out of network. I’m like, “Wait, but I was in an in-network hospital.” And you get all those surprise billing issues and… Which they’ve legislated some of that now and gotten rid of it, thank God. But you’re right, there’s a real opportunity here.

Charles Rhyee:

Yeah, really appreciate Munjal for you joining us today, and we look forward to catching up at some point in the future.

Munjal Shah:

All right, thank you, Charles.

Charles Rhyee:

Thank you.

Speaker 1:

Thanks for joining us. Stay tuned for the next episode of Cowen Insights.

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