Emerge Diagnostics entered the tumultuous workers compensation industry four years ago with a device able to detect the kind of workplace injuries that cost employers millions of dollars annually, but are the hardest to spot, even with the most sensitive technology. Earlier this month, the company raised $1.85 million in its third and most recent round of financing.
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The money will go toward adding at least four full-time salespeople, CEO Robert Thompson said. The new hires would triple a sales force that currently consists of two full-time employees.
They will be deployed mainly in states between Texas to the Dakotas, territory where Thompson said client demand has been strongest. “That’s where the doors have been opening the fastest, ” he said. “But eventually we will be in all 50 states.”
So far, growth has been gradual for the small company based in Carlsbad, California, near San Diego. It has raised $3.75 million since launching in 2012, but only began production in 2013 after Emerge Diagnostics received FDA approval for the wireless version of the technology called Electrodiagnostic Functional Assessment, or EFA, and invented by Emerge Diagnostic’s founders — MaryRose Reaston and her husband Phil Reaston. The device uses electromyography (EMG) and range of motion testing to register the kind of strains, sprains and tears that affect the back, knees and shoulders but that don’t easily register on MRIs and X-rays. Think back pain, slipped discs, tendonitis and one of the nation’s top workplace afflictions, carpal tunnel syndrome.
These common problems continue to bedevil employers, costing them at least $20 million a year, according to OSHA. Meanwhile, medical costs are pushing up the price of compensating workers for on-the- job injuries even as the number of claims nationwide has dropped, according to the National Council on Compensation Insurance, an insurance rating and data collection agency in the workers’ compensation sector. That means a misdiagnosed tear or sprain can cost employers unnecessarily and take a toll on employees, who can’t work or perform simple tasks like buttoning their clothes or brushing their hair.
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Employers can use EFA after an injury, but the real advantage comes from creating a record when a healthy worker is hired. That way, a company has a before-and- after comparison, making it easier to weed out claims that aren’t in fact work-related as well as avoid unneeded surgery or treatment.
Actually, EFA isn’t new to workers comp claims. In 2007, it was used in a case to show that a mail carriers’ back pain was due to scoliosis instead of a workplace injury. But before, patients were tethered to a device whereas the wireless device allows them to move around, which gives a much fuller record of what is happening in the body, MaryRose Reaston said. “It is really a better diagnostic tool,” she said. Instead, electromyography, the basis of EFA, is more common although largely for non-commercial applications like monitoring the reaction of Parkinson’s Disease patients to medications and developing prosthetic limbs through analyzing walking patterns, according to Thompson.
The company plans to continue to contract out services instead of selling the technology directly to users (patient reports are stored by Emerge on remote servers until the employer needs to access the scan). For now, the device still costs under $20,000, although Thompson would not give an exact price tag for the services.
