It’s hard to land an accurate estimation of the true cost of a medical procedure. According to a recent study, 92 percent of consumers want to know payment responsibility prior to a provider visit, and for those that received their bill after the fact, 74 percent were confused by the explanation of benefits and medical bills.
“This is a really dysfunctional marketplace,” says Medxoom co-founder Jeffrey Toewe. “We wanted to understand why it was so hard to state a price and why the billing experience was so fragmented. We set out to create a more transparent marketplace and better comparison shopping experience.”
Toewe and his co-founder Tito Milla both grew skeptical of medical billing procedures from their own personal experiences. Milla received a bill for a procedure that was significantly more than anticipated. Upon requesting further explanation, he was told that the hospital was unable to share any more information.
Toewe was in search of transparency for his son’s upcoming eye procedure.
“There wasn’t pricing published anywhere, and the doctor confirmed that the hospital would make that information unavailable,” says Toewe.
The two are solving the challenge they and many others face with a health savings app that simplifies the consumer experience surrounding healthcare pricing and helps them make more educated choices.
“Our mission is to put more of this information out in the sun and help consumers and employers know what these price benchmarks are,” says Toewe.
Medxoom’s main customers are employers and benefits administrators — employees receive the app as part of their benefits package. From their research, Toewe shares that many of the current healthcare applications on the market give the employee the approximate cost of a procedure without knowing if your insurance plan covers it or not. Since Medxoom is connected through your employer, the app knows your plan’s benefits and can give you an accurate number based on your coverage.
“The employer has control and visibility over the cost of insuring their group and the cost variances. For their employees, they see an application that allows them to shop for healthcare, see the cost variances, and use a unified payment experience as well.
“There’s a single experience where you receive, track and pay your healthcare bills, regardless of the doctor’s office, preventing the current fragmentation in healthcare,” says Toewe. Medxoom is offered on a monthly subscription basis.
The employer has the first go at cost variances with a chance to renegotiate and eliminate bad cost outliers in the marketplace. The employee then sees the renegotiated rates on a comprehensive comparison chart and can choose the best course of action for them, without a strict deadline.
The team closed a seed round late last year and plan to pursue a Series A by the end of the year.
“We’re hoping to increase higher distribution of our product and higher participation from well-known investors and veterans in the digital health space for our upcoming Series A round,” says Toewe. “We’re looking forward to filling this need for employers and bringing a positive impact to their healthcare costs.”