The idea is simple: Pay ‘cash’ for healthcare.
That’s what one healthcare startup is offering employers, health plans and healthcare providers. As medical costs rise to more than $3 trillion each year, Asserta Health is a different kind of intermediary that enables ‘cash payment’ for healthcare services. This model reconnects payment and service delivery and streamlines the payment process between payers, consumers and providers.
The idea first formed in 2007 when Korb Matosich and Lisa Behnke were working together at a large healthcare company. Combined, they have an unusual 360 degree view of healthcare payments: Behnke is a nurse and medical doctor who was submitting claims and helping hospitals get paid for her services. She’s also experienced managing the clinical side of claims processes for payers.
Matosich has experience leading business operations on both sides of the healthcare transaction, managing complex claims and billing processes for both payers and providers.
Both agreed that the healthcare payment system was broken and inefficient for all parties—including the impossible plight of consumers trying to understand prices and pay their bills. With their experience managing all aspects of healthcare payments they saw an opportunity to lower costs and improve the payment experience for all parties by reconnecting payment and healthcare delivery.
In 2014, they launched Asserta Health.
“Most folks are trying to make little modifications around the edges about healthcare payments,” says Matosich, CEO of Asserta Health. “We’re trying to make it work in a fundamentally different and more efficient way. We saw how we could use our expertise to do it without completely changing how providers and payers do everything today.”
Behnke says with 25 cents of every $1 spent on healthcare going towards administrative costs, Asserta Health needed a payment solution to help get more of the dollar to the providers and in turn, lower the costs of the services provided. This approach to healthcare payments would not only make payments more efficient, it’s also the ultimate in price transparency for consumers.
They searched for a low-cost ACH payment solution that would allow them to easily onboard users and support their growth as transaction volumes increased.
A Tough Pill To Swallow
After spending the entire year on product development, Matosich says that at the end of 2014 Asserta Health was in agreement with a traditional bank to use a purchasing card infrastructure to administer cash payments on behalf of employers and health plans.
When a more risk-averse compliance manager took over the project, the contract fell through on that Christmas Eve.
“We did find another bank to work with, however it wasn’t the ideal solution. We were desperate and searched the internet for an alternative way to execute payments more efficiently for everyone involved,” Matosich says. “As we searched, we stumbled across Dwolla.”
In addition to ACH payments, Matosich says he was looking for three key features for the Asserta Health payment solution that traditional banks didn’t offer:
- Predictable pricing
- Operational notifications related to payment activity
- Easily link existing bank accounts
“Our original model was that everyone needed to set up their own bank account with our financial institution to use these purchasing cards,” Matosich says. “When we found out about Dwolla, where all of our clients could simply build a secure connection to their existing bank account, we were thrilled.”
Dwolla cleared another of Matosich’s hurdles: no per transaction fees.
“When you are dealing with the volume and sizes of healthcare transactions, paying two or three percent on each transaction makes absolutely no sense,” Matosich says. “With Dwolla, we knew this pricing model was going to be a better financial decision, as well as long-term decision.”
There was a thought, Matosich says, about Asserta Health building its own ACH payment integration.
“But that decision took about 15 seconds,” Matosich says laughing. “We stick to what we’re uniquely qualified to do–make real-time payments work in healthcare.”
Asserta Health made it official and launched with Dwolla’s V1 ACH API in 2015.
The Dwolla Platform checked their boxes.
“Dwolla works at our speed and with our model of efficiency to keep the transaction at as low a cost as possible for our customers,” says Behnke, Asserta Health Chief Medical Officer. “Our purpose is to get that 25 cents of every dollar going towards administrative costs down to 5 cents, and we need a partner like Dwolla to helps us do that by leveraging the ACH network.”
“Dwolla makes it possible for us to create a more efficient healthcare payment model and we are excited that they will be able to support our growth as the interest in ‘cash payments’ increases.”
Dwolla works at our speed and with our model of efficiency to keep the transaction at as low a cost as possible for our customers. We need a partner like Dwolla to do that. Dwolla makes it possible for us to create a more efficient healthcare payment model.
Just What the Doctor Ordered
When Asserta Health initially launched their application and introduced the idea of “cash payments” their integration was built on Dwolla’s V1 ACH API.
As Dwolla’s business scaled alongside Asserta Health, Asserta Health had recently migrated their application over to Dwolla’s V2 ACH API.
Matosich said having a strong working relationship with Dwolla, unparalleled support and robust developer documentation made the migration a smooth transition. Being able to leverage Dwolla’s white-label ACH API for payments has been ideal in allowing their users to easily connect their existing bank accounts.
“What is good about the direction we’ve gone is the Dwolla API is much more flexible so we are able to create an even tighter integration,” Matosich says. “We anticipate a much more complete and integrated experience as we move forward.”
With Dwolla powering the infrastructure for Asserta’s medEcash platform, Matosich says they would be a different company had they not partnered with Dwolla.
“We’ve had great support and have really enjoyed working with the Dwolla team,” Matosich says. “We love how responsive they were to both our business and technical questions.
“Dwolla paves the road to the future for us.”
On top of raising capital to grow their business, Matosich says they are anticipating adding an additional 60,000 users in early 2019 and are looking to be north of 200,000 users by 2020.
“We are looking for larger health systems that want to do business on a ‘cash’ basis and are also interested in saving money on their own employee health plan,” Behnke says. “We are also looking for nontraditional startup health plans. We feel like ‘cash’ is a real differentiator for them and we’d like to help them do more and grow faster.”
From ‘what if’ conversations among health care colleagues to launching a business that is literally transforming the healthcare payment experience for payers, providers and consumers, Asserta Health is excited about the future. A key component of Asserta’s development from simple idea to dynamic innovator has been the Dwolla platform.
As Asserta Health continues to grow, Dwolla’s support, reliability and advancements will be there to back them.