With telehealth’s popularity exploding and new players jumping into the market, the service is becoming increasingly commoditized. As a result, startups are diversifying and adding wraparound services to distinguish themselves in the increasingly crowded space.
For example, large and small players in the market have understood that they need to offer more than just telehealth. To this end, larger companies like Teladoc and Doctor on Demand are going the merger and acquisition route — buying Livongo and combining with Grand Rounds, respectively. Similarly, smaller startups are expanding their offerings and pivoting their business model — like Beam Health Group.
Founded in 2018, Beam Health was initially focused on telehealth for physician practices, said Co-founder and CEO Sas Ponnapalli in a phone interview. When the Covid-19 pandemic hit, everything changed. Suddenly, telehealth was everywhere.
Beam Health first changed up its pricing model to keep abreast with the rise in demand for telehealth. Initially, it charged $10 per consult on its platform. But once the pandemic hit, Beam saw that its private practice customers were conducting 20,000-30,000 visits on its platform in just a few months. So, it moved from a transactional plan to a Software-as-a-Service model of $125 per provider per month, Ponnapalli said.
Then, Beam Health saw that a lot of customers felt that just telehealth wasn’t enough for their practice — they needed a wholesale operational change, he said.
A Deep-dive Into Specialty Pharma
A specialty drug is a class of prescription medications used to treat complex, chronic or rare medical conditions. Although this classification was originally intended to define the treatment of rare, also termed “orphan” diseases, affecting fewer than 200,000 people in the US, more recently, specialty drugs have emerged as the cornerstone of treatment for chronic and complex diseases such as cancer, autoimmune conditions, diabetes, hepatitis C, and HIV/AIDS.
The startup decided to add capabilities to help physicians with other pain points, namely providing a digital front door and optimized revenue cycle management. The company helps private physician practices create websites, with capabilities like patient registration, insurance eligibility checks and co-pay collections built in.
Many private practices did not have a website prior to the pandemic, Ponnapalli said. But as the pandemic transformed the way patients sought and received care, a website became a necessity.
“Now, everything is virtual, everything is remote, nobody is coming into your office anymore,” he said. “You went from having a business that was generating pretty good revenues to next to nothing. A lot of these clinics immediately struggled.”
And many are still struggling. Physician net revenue was down 4.5% in 2020 compared to 2019, according to a report by Kaufman Hall.
In this landscape filled with financial uncertainty, collecting payment from patients is of utmost importance. Pre-pandemic, about 6% of a private practices’ revenue came from a patient’s co-pay, but that figure has jumped to 45% today, Ponnapalli said. This is why Beam Health automates patient collections for private practices that otherwise might have to rely on expensive collections agencies.
While telehealth and automated administrative tasks are key for private practices to succeed in the current landscape, Beam Health wants to take it one step further.
The company’s goal is to create a single metric to determine a practice’s financial and operational health, Ponnapalli said.
Beam Health is using machine learning and artificial intelligence to consolidate various practice data points, like telehealth use, into one metric that physicians can look at say “okay, this is my score, this is something that I need to improve,” he said.
With the challenges facing private practices today, it is a good time for a company to come and change the way these practices are measuring their business performance, Ponnapalli said.
Photo: claudenakagawa, Getty Images
