‘Expedia for health insurance’ sees big potential in insurance exchanges

A health IT startup that bills its education technology as an “Expedia for health insurance” is looking to cash in on the state insurance exchanges created under last year’s federal health reform law.

New York-based bWell-Informed has already scored a deal to plug its software into Utah’s health insurance exchange, which is an online marketplace that allows consumers to compare and shop for health plans.

Now, the company is looking to obtain more insurance-exchange work, and secure some Northeast Ohio investors that would enable the company to relocate to the Cleveland area, said CEO and Northeast Ohio native Philip Micali.

The company is targeting a fundraise between $1 million and $2 million that it would use to hire some programmers, boost its marketing and develop a mobile version of its software, Micali said.

bWell’s educational software is designed to be plugged into a larger transactional software package that powers the health insurance exchanges. The company’s technology allows users to enter their personal health data, and helps them understand the different insurance options available. It also projects how much each option will cost over time, factoring in the user’s personal health information, Micali said.

bWell has two versions of its technology — one aimed at individual consumers and the other aimed at businesses. With its consumer product, bWell gets lead-generation fees from brokers that aim to sell insurance to consumers.

For its product aimed at businesses, bWell reaches customers through its relationships with benefits-administration-outsourcing companies that are hired by large companies and government groups. Via its relationship with Chicago-based benefits administrator bswift, bWell became involved with the Utah health insurance exchange. bWell receives an annual licensing fee under this model.

Micali hopes the Utah exchange is the first of many that employ bWell’s software. With the health reform law requiring exchanges to be operational by Jan. 1, 2014, the time for bWell to pick up those clients is now.