There is growing interest from employers “to break some glass and do things differently” with benefits, says Brian Marcotte, president and CEO of large employer coalition the National Business Group on Health. But the average benefit tech startup is still struggling to get in the door and get employers’ attention.
It’s a problem NBGH is working on solving with its Health Innovations Forum, a highly competitive competition for benefit tech startups, with the best of the best able to pilot their products at an NBGH member company. NBGH’s members are primarily Fortune 500 companies and large public sector employers, which provide health coverage for more than 55 million U.S. workers, retirees and their families.
Also see:
The startups are judged by members of 14 companies that are all progressive and leading edge in their own right, Marcotte says. These NBGH members have worked with startups before "and have some interest in advancing innovation and good solutions," he says. The Innovations board also includes venture capitalists who provide input as well.
Initially, the board judges on three main questions:
1) What problem is the startup trying to solve?
2) How does that solution solve for a problem and leapfrog other potential solutions in the market?
3) What results, if any, does the startup have at this time?
The first round of competition began in April 2015 with 18 initial applications. After an assessment, nine were submitted to the judging panel, which observed a 20-minute presentation and participated in a 10-minute Q&A with each of the nine companies.
From there, seven startups presented to a larger council of 22 companies, and six earned between two and five relationships with companies. "Each got traction with a large employer, which was the whole goal here," he says. "Accelerate adoption. Get some relationships working."
The second application process finished in November and received 15 applications, of which nine companies were invited to present. The next application process is currently open and applications are due by Jan. 31, 2016.
The idea for the competition stems from Marcotte’s time as vice president of compensation and benefits at Honeywell. At Honeywell, “we were interested in pursing the most innovate solutions to improving employee experience or improving health care costs,” he says. “We looked for these new opportunities.”
“There are a lot of great organizations out there that are trying to break in, but struggle getting attention with large employers,” he adds. “Large employers do not always have the time to spend with startups that they know little about.”
When Marcotte joined NBGH one of his first actions was to start the Forum. “The whole purpose is to … accelerate adoption of startups,” he says. “[To] get a startup with a compelling value proposition in front of enough large companies to get traction.”
A ‘helpful’ program
The program has been invaluable for Houston-based 2nd.MD, which has advanced in the competition and is now piloting its program with a NBGH member company.
“It help[ed] us raise our profile among some businesses that might not otherwise know who we are,” says Chris Ferris, chief marketing officer of the company that provides online medical second opinions with leading specialists. “This allows us to raise [our] profile among key audiences and to tell our story.”
Also see: "
The ability to present in front of NBGH member companies will allow 2nd.MD to change more lives, Ferris says. “It helps us help more people. We can pick up smaller employers — which we are happy to do. A hundred here, a thousand there,” he says. “But, when we can sign up employers that offer benefits to 50, 60, 100,000 employees and dependents, it puts us in a position to help so many more people.”
Through working with NBGH companies, 2nd.MD has also learned valuable lessons about benefits. Many benefit providers view each other with a suspicious eye, Ferris says, because they think they are competition.
“[However,] we are a terrific compliment to some of these other benefit programs,” he explains. “For example, we’ve been talking with Aflac and MetLife and say, ‘How we can partner?’ If [a customer] calls [Aflac or MetLife], they can say, ‘Before you exercise this part of your benefit program, you should get a second opinion.’”
“That is something we are discovering working through this,” he adds. “We can be successful. But, we will be more successful if with partner with other benefit providers.”
