AbilTo, ZocDoc and Medivo offer online tools to improve diagnosis and treatment, and cut costs.
Five years ago, when he was diagnosed with ADD, or attention deficit disorder, Michael Laskoff soon realized just how inefficient the mental health care system is. He had questions about the treatment, which included therapy and behavioral coaching: How long would it last? How much would it cost? How would he know when it was done? The answer he got: It depends.
“Where else in life are you expected to spend so much for something so inconvenient and not know when you’re finished?” Mr. Laskoff wondered.
Frustrated, he started a business that could answer those questions.
Today, his three-year-old Manhattan-based company, AbilTo, provides cognitive behavioral therapy and related types of treatment via phone and video conferencing for patients with conditions such as anxiety and mild-to-moderate depression. A team that includes a licensed clinical social worker and a coach treats individual patients for a fixed period of time and at a fixed price—$2,500 to $3,000. Clients so far include insurance companies and law firms, which offer the counseling to insured clients and employees, respectively.
“For prevalent mental health conditions, like mild and moderate depression, why not create best practices that have a single price, run for a set duration of time and are measureable in outcome?” Mr. Laskoff explained.
AbilTo is one of a growing number of technology companies in New York that are focusing not on the higher-profile world of biotech, but on the slow-moving world of traditional health care. Spurred by new health reform laws, the dire need to save money and the ability to demonstrate measurable results, health IT entrepreneurs are building companies that use crowd sourcing, social media and other Internet-enabled technologies to reduce costs, improve delivery and help consumers take charge of their health care. A nascent network of investors and mentors is spurring them on.
Whether or not the federal health care reform law succeeds is an open question. In the end, say these entrepreneurs, it will be the small startups like themselves that usher in the revolution.
“At the end of the day, it’s the entrepreneurs who are going to make things happen,” said Sundeep Bhan, co-founder and CEO of Manhattan-based Medivo, which collects, organizes and analyzes patient test data for doctors and helps them use it to plan treatment.
New York’s health care industry is huge, providing a big launch pad for IT companies focusing on the sector: In 2009, there were 431,000 people working in the health care sector in the city, according to the Center for Health Workforce Studies at the University of Albany. Dozens of hospitals and thousands of doctors’ office and clinics constitute a ready-made market.
Health care reform and the weak economy are forcing change upon an industry that has traditionally dragged its heels when it comes to adopting new technology. Some companies are springing up to help workers manage their own health care, as insurers and employers shift more of the burden onto them. ZocDoc is one of the best known, having recently banked $75 million in venture capital for its business, which helps consumers find doctors and dentists and book appointments online.
Others, such as AbilTo and Epic Health Group, are bringing online tools to the actual diagnosis and treatment. Founded recently by Dr. Ronald Razmi, a Mayo Clinic-trained cardiologist and former McKinsey consultant, Epic aims to manage disease remotely. A cardiac patient experiencing symptoms, for example, could interact over the Internet with a nurse practitioner or other professional guided by Epic artificial intelligence software. Dr. Razmi recently attracted $4 million in capital from two angel investors and is in talks, he says, with hospitals to provide the service to their patients. He hopes to have a commercially viable product by the end of 2012.
“You’ve shifted a $1,700 dollar emergency room visit to a cheaper online visit,” said Dr. Razmi. “Patients can seek care at an earlier point and not have to be admitted.”
Other companies are exploiting the data side. Medivo Inc. expects to close soon on a $7 million to $8 million round of financing. Crossix Solutions, evaluates the effectiveness of pharmaceutical advertising. Happtique, a subsidiary of the Greater New York Hospital Association, runs an app store for health care providers.
An ecosystem that can sustain entrepreneurs is beginning to form. It includes Health Care 2.0, a meet-up group for health care innovators and Startup Health, a public-private partnership to improve access to capital headed by former TimeWarner CEO Gerald Levin and Steve Krein, co-founder of Organized Wisdom, which helps doctors interact with patients online. Startup Health also runs an “academy” that will take equity positions in companies and provide mentors and other training. Another organization, the two-year old NYC Health Business Leaders showcases and promotes health innovation while the city’s Bio (Eds & Meds) NYC 2020 effort aims to encourage entrepreneurship in bioscience and health care technology.
In another effort to get innovation off the ground, BluePrint, a recently launched health care IT accelerator, has already fielded more than 200 applications for 10 spots in its program starting in January. Winners get $20,000, space for three months and mentoring from a group of 100 venture capitalists, entrepreneurs and health care professionals.
Judith Messina
