WhiteGlove Health’s Growth Fueled by Technology

Bob Fabbio is a tech industry veteran most known for founding systems management company Tivoli which went public in 1995 and a year later sold to IBM for $743 million. He’s been a part of other successful exits such as selling Dazel Corp., which was acquired by HP in 1999. His latest venture is WhiteGlove Health’s which now has 500,000 members primarily in its home state of Texas.

An enterprise software veteran isn’t the obvious person to lead a healthcare provider. However, as outlined in Healthcare Disruption: Healthcare Providers Repeating Newspaper Industry Mistakes, it’s frequently not the obvious competitors that create the greatest disruption in the marketplace.

The legacy healthcare payment model for primary care is a Gordian Knot designed by Rube Goldberg. Consider the legacy model versus WhiteGlove’s model in the tables below.

Without WhiteGlove (no insurance or high deductible health plan)

Description Time (min.) Money
Call doctor, unavailable 10
Drive to clinic/ER (gas) 15 $3
Fill out forms, wait to be seen 30
See healthcare professional 20
Pay for the visit (clinic/ER) 10 $90-$750
Pay for parking 3 $5
Drive to the pharmacy (gas) 20 $3
Wait for Rx meds 20
Shop for over-the-counter meds 20
Pay for Rx and OTC 4 $62
Shop for groceries 20
Pay for groceries 7 $14
Drive home (gas) 20 $3
Total 200 min. $180-840

As a WhiteGlove Member
Description Time (min.) Money
Contact WhiteGlove 10
See healthcare professional       20 $35
Fill out WhiteGlove survey 5
Total 35 min. $35

People are shocked when they hear how affordable models such as WhiteGlove, Qliance, DirectPayHealth and MedLion are. It almost sounds too good to be true that they can save 30-50% off a standard health plan AND deliver a higher level of service. That savings is the result of disruptive innovation that changes how care is accessed and where, changes how care is paid for, and changes how the cost of care is lower while the healthcare experience improved. Combining a direct pay healthcare payment model together with a high deductible health plan is a very viable alternative for employers. On a service level, Qliance’s Net Promoter Score is higher than Google or Apple and WhiteGlove Health has more 5-star ratings on CitySearch than any business in the country. This is in contrast to the Health Insurance industry that has the lowest average Net Promoter Score of any major industry including cable companies, airlines and other notable low performers.

How do they enable accomplish this? They are demonstrating how healthcare providers will use healthtech to differentiate and produce better outcomes. Compare how WhiteGlove’s competitors typically have a support/admin staff to provider ratio of 5:1 dealing with the Rube Goldbergian insurance hassles versus WhiteGlove having less than a 1:1 ratio. The number one reason half of primary care physicians say they’d leave medicine if they could is dealing with insurance hassles.

All the doctors I know went into medicine to practice medicine. Instead, most are dealing with insurance headaches and the accompanying overhead costs and management headaches to hire staff that deals with manual processes to handle billing and claims, insurance coding and processing, reimbursement and collections, and scheduling. In addition, all the staff personnel and manual processing introduce a higher likelihood of errors that negatively affects the overall patient experience. Fortunately, there is a better way for them and their patients.

It’s clear that Bob Fabbio has read Clayton Christensen’s Innovator’s Prescription. In Christensen’s book, he outlines how innovators utilize disruptive technology coupled with a disruptive business model to provide more affordable, simpler products or services than incumbents. WhiteGlove’s S-1 filing sheds light on their approach:  [Note: WhiteGlove delayed its IPO due to the recent market volatility.]

We believe our proprietary technology platform separates us from the others. It was designed to provide lower cost, eliminate errors, automate workflow and treatment, and deliver a higher quality healthcare experience while supporting an underlying membership-based business model. We believe the experience of our management team in creating and operating a large-scale integrated technology platform gives us a significant competitive advantage over our competitors.

One of WhiteGlove’s founding principles has been to leverage technology in unique ways to:

  • Improve access and quality of experience. We leverage our technology platform to make scheduling appointments easier, provide our members continuous online access to their medical information, including their medical records, medical history, diagnostic results, visit results, prescription medications, and medical expenses, ensure timely follow-up after member care visits, and implement treatment plans to quality standards.
  • Lower the cost of health care. We leverage our technology platform to streamline our operations, which significantly lowers our operating overhead and expenses and reduces errors.
  • Erect competitive barriers. Our fully integrated information technology system links together all of the constituents inside and outside our business (from front-office to back-office), which raises the competitive barriers.

WhiteGlove represents an emerging trend of technology-enabled services that will disrupt healthcare’s hyperinflation that is affecting the well-being of the country. As the former Chair of the Council of Economic Advisors said, “we don’t have a debt problem, we have a healthcare problem.” Or as Bill Gates outlined in his recent TED talk, healthcare costs are the greatest threat to our schools. To date, health reform in Massachusetts and at the federal level have focused almost exclusively on access (i.e., insurance reform) rather than healthcare delivery reform (i.e. cost of care). I believe it will be the DIY Health Reformers such as Bob Fabbio that will address the cost side of the equation that has eluded the politicos. Reaching a half million members is a great start but they’ll need to continue their progress to reach sustained profitability.

Dave Chase is the CEO of Avado.com, a Patient Relationship Management company. Previously he was a management consultant for Accenture’s healthcare practice consulting to 25 hospitals and was the founder of Microsoft’s Health business. You can follow him on Twitter @chasedave.

2 replies »

  1. 30-50% off? That’s amazing! This is true service and genuine care for the people. Thank you very much!