Abir Sen is at it again. The 38-year-old recently launched a new health IT start-up, this one skillfully timed to absorb some of the bumps during the rocky rollout of the new online insurance exchanges.
The new company, Gravie, aims to help consumers and businesses sort through the myriad of health insurance choices through a website and licensed brokers who work with consumers in person and on the phone. Gravie pulls in options from the new MNsure insurance exchange as well as plans sold in the broader individual market.
Gravie — pronounced just like the thick sauce ladled on meat and potatoes — launched its Minnesota website in early September, and has since added 49 employers.
Sen and two of Gravie’s other founding partners, Jill Prevost and Marek Ciolko, are experienced hands at launching health IT companies. The entrepreneurial troika worked together at Red Brick, an IT wellness firm that Sen helped start in 2006. And the three also co-founded Bloom Health, a private insurance exchange now used by Medica and sold to WellPoint and two other nonprofit insurers in 2011.
Headquartered in the Lumber Exchange in downtown Minneapolis, Gravie was started with $2.6 million in financing. The bulk of funding comes from New York-based FirstMark Capital, which has invested in such high-flying start-ups as photo-sharing site Pinterest, ticket seller StubHub and online brain gamer Lumosity.
Sen plans to seek a new round of financing to help Gravie expand nationwide next year.
Q: Why the name Gravie?
A: It’s a play on the word “benefits.” As in, when you work you get wages. The rest is gravy.
Q: How does Gravie work?
A: We use a questionnaire to help individuals and businesses sort through hundreds of health insurance options. For some, MNsure is the answer, for others it’s the private market. We can help determine whether someone is eligible for tax credits on the state exchanges and help them apply for it.
We aggregate the information, take care of the payment and help people manage balances in their health savings accounts or flexible spending accounts. If you are interested in concierge services, we coordinate all of that on a health care dashboard. Consumers have one place to manage all of the things in their health care life.
Q: Who is your target market?
A: We are focused on the individual consumer experience, but the way to scale up is to work with businesses, especially firms under 1,000 employees. Our first customers have been smaller, but increasingly we’re meeting with larger companies, such as retailers.
In 2015 and beyond, businesses [with more than 50 workers] that don’t have qualified health insurance today will have to decide whether to pay a lot more for group coverage or whether they’ll drop coverage and pay the penalty. It’s not really a palatable choice.
In reality, if I am a small employer with group coverage, I may be doing my employees a disservice — some employees might receive tax credits from the government that could make buying through the exchange a much better deal for them than the group plan.
We tell businesses to drop group coverage and send all of the people to the exchange. They might not have had the courage to do that before. Gravie can create a solution that is a win-win for the employer as well as the employee.
Q: I thought the beauty of the exchanges is that people can shop themselves. Why would someone need Gravie?
A: You can buy it yourself. But health insurance is way too complicated. Gravie can help people figure out if they qualify for a subsidy, make the application and offer in-person assistance if you need it.
Q: So Gravie basically plays the role of a broker?
A: Yes. We are a licensed broker and we will have a broker’s license in all 50 states by early next year. Like traditional brokers, we collect a fee from insurance companies when people sign up for health coverage. But our employees are salaried. We make the same amount whether people buy on the exchange or from the insurance company.
Q: How do you differ from traditional brokers or established websites, such as e-health?
A: Traditional brokers are not really equipped to deal with individuals. Their entire mind-set is based on solving employers’ problems, and selling insurance to people. Sure, we do that, too. But we also bring a more comprehensive set of after-sale services, including qualified member advisers who can help if you have a claim that gets denied or you have to go to the hospital and you can’t figure out what, who and how to pay.
Q: You’ve been successful at reading the health insurance market in your previous ventures, with Definity, Red Brick and Bloom Health. How bright is Gravie’s future?
A: We think the consumer market for health care services is going to explode. Consumers have more power than they’ve had in the past. But there’s so much information out there that it’s confusing and frustrating without some road map.
There used to be just a few ways to buy insurance, where you bought into a predetermined provider network and a plan design. But now the old “health plan” is starting to get disaggregated.
Someone might buy a bronze insurance plan on the exchange, save money, and then want to pair it with a pediatric concierge service because that’s important to them. Our focus will be on helping individuals put together the various pieces in a way that makes the most sense for them. We represent the new way to sell goods and services in health care.