“The biggest thing to happen to health insurance in 20 years is here.”
Insurance startup Bind is incredibly confident in the expansion of its on-demand health insurance platform, which offers consumers a core set of health care benefits, as well as the option to add coverage for specific procedures as the need arises.
Wait, what? Isn’t that the opposite of what health insurance is supposed to be? “It’s not intuitive for people, but I think when we started this we thought, ‘how do people really use the health-care system?’ And we used it in an on-demand way,” Tony Miller, co-founder and CEO of Bind explained in an interview with CNBC.
Basically, the model, which is used by self-insured employers, separates common and routine procedures from big-ticket surgeries. The core services include preventive care; urgent, emergency and hospital care; chronic care and pharmacy needs. Need a knee replacement? Add it on to the plan.
The copay for routine procedures is what one would expect–from $15 for a retail clinic to $100 for urgent care. The bigger procedures have a bigger copay based on the price of the procedure (which patients are told up front) and can be a couple of thousand dollars, which can be paid for via payroll deductions.
The real selling point of the model is not the on-demand aspect but the price transparency; for big-ticket procedures, the consumer is given a range of quotes from different providers from which they can choose. Miller gives the example of a knee arthroscopy, which can range from $6,000 to $24,000. If a consumer picks the lower-end price, their copay will be $1,000. If they pick the high end, their “copay” will be $6,000.
“What happens is the consumers actually go and buy the more cost-effective provider and they save money. But more importantly, the entire pool saves money … we save $18,000 for the group,” Miller told CNBC.
It has the backing of UnitedHealth, both financially and as a health care network partner, as well as Ascension Health. So far, it’s been used primarily by mid-sized employers, but Bind says it is adding a handful of Fortune 500 companies to its roster next year.
“People are hungry for health care price certainty—that’s exactly what Bind offers. We built Bind because we passionately believe that fear of unknown costs shouldn’t hold people back from getting the care they need,” said Miller.