It’s hard to believe that we’re already celebrating HealthJoy’s 10th anniversary. It feels like just yesterday that a few of us were tirelessly working in a house in downtown Chicago, and now there are nearly 450 HealthJoyers on the same mission all over the world. We’ve changed in a lot of ways over the years, but one thing that certainly hasn’t been lost in this growth is this team’s passion and drive to remove the complexity from healthcare.
Our team couldn’t be more excited about this milestone and while it serves as a launchpoint for our next decade, it’s also a great time to reflect on the past one.
So, before we kick off HealthJoy’s second decade, we’re taking a look back at all the memorable moments and milestones that have made up the first 10 years.
Doug Morse-Schindler (HealthJoy’s co-founder and President) and I hopped on HealthJoy’s new podcast — Bonding Over Benefits — to talk about the history of HealthJoy and some key events that have taken place along the way. Here are a few highlights from our conversation.
Justin Holland: Doug and I met in my junior year of high school in video class in Tampa, Florida. My dad was in the military, so I moved around a bunch, but Doug was a Clearwater native, which is just next door to Tampa.
After school and a few other stops along the way — including a Caribbean sailing trip we took – we’ll get into those stories another time — we started our next business. It was an ad tech platform we launched out of San Francisco. We ended up selling that business to a security company based in Europe.
After that, we found our way to healthcare.
Justin Holland: I tore my ACL and was trying to figure out how to navigate the healthcare system using an ACA plan. I thought, ‘I'm pretty good at Google, and even I can't figure it out. How is anyone else going to figure this out?’
I had this idea – we could fix healthcare in the U.S. if we just applied bleeding-edge technology. That was 10 years ago. And I’m reminded of how wrong that premise was every single year.
Doug Morse-Schindler: I think back, and it’s definitely not surprising that I went the entrepreneurial route. Growing up, I always had a business every summer, whether it was car detailing, boat detailing or starting a book reselling business in college.
Ultimately, I went into investment banking specifically mergers and acquisitions for a few years. I always knew I wanted to build companies, but decided to go into finance first. It was a great foundation for understanding how businesses operate.
At the same time, I was determined to go on a big sailing trip. I bought a sailboat when I was 25 and rebuilt it over two years.
While I was still doing investment banking, the timing worked out perfectly. Justin had just sold his first company and we got to slack off and go sailing throughout the Caribbean for a year. We probably don’t have enough time for all the stories from that trip, but it was a great time. And Justin and I got to know each other that much better.
I never expected to end up working in healthcare, insurance or benefits.
But when Justin and I started talking in mid-2013 and realized the challenges consumers faced, we both became obsessed with the idea that we could build bleeding-edge technology to help consumers navigate the healthcare experience and access higher quality, lower cost care.
Justin Holland: Every single company I've ever started has always begun in a house.
When you start a business in a house while living there, you know you'll be working all day and all night. When people say ‘I worked 100 hours this week’ – you actually do work 100+ hours every week!
You never take any time off, you're just always working at the beginning.
Obviously, that's not sustainable long-term, but you need to have that criticality at the beginning of any business. After you reach a certain point, you find the right balance and stick to it.
Justin Holland: In 2013 the Affordable Care Act (ACA) was a new concept. Many individuals in the United States were uninsured, and legislation was passed to say ‘This is how we help get health insurance coverage for everyone to interact with the healthcare system sustainably.’ And regardless of what we think politically about it, ultimately we believe that healthcare is a basic human right.
So our job became ‘how do we apply best-in-class consumer technology?’ We saw this as the critical, missing piece across the healthcare vertical.
So the question was, ‘How do we take what we've learned from 10 years of doing tech in a high-performance environment, and apply it to healthcare?’
For the first couple of years, it was hand-to-hand combat. We knew how to build tech, but the question became ‘How do you distribute inside of healthcare?’ ACA was the first time you could do it at a consumer level.
Doug Morse-Schindler: Distribution in healthcare is unbelievably important. The concept of care navigation had yet to flourish into what it is today.
Virtual care was also just starting to emerge around 2013-2014. The idea that you could connect with a physician over the phone and get a diagnosis – maybe even a prescription — was very new.
Ultimately, we realized care navigation was essential.
We worked closely with GoHealth, an early partner, and their agents. They were selling individual insurance plans and our product on top of those plans. HealthJoy was used to help individuals navigate their ACA plan, which in some cases had a $6,000 deductible.
Plus, many of these individuals had never had insurance before, so they really didn't understand insurance basics like what a network is or the difference in cost depending on which location you go to for your MRI.
We had a population that needed help making healthcare decisions, and that's really where we cut our teeth for the first two or three years.
This period played a key role in developing the member-centric component of our DNA. We were so focused on driving value for the members.
This value has remained consistent over the past decade, even as we've evolved and moved into the employer space. Being focused on the member as the center of our universe very early on has been a key component that has led to our success.
After helping people access virtual care for the first time, we had a massive tailwind to apply a digital solution to something that predominantly had been done in physician offices.
Justin Holland: We saw the writing on the wall with the ACA. We probably had nine to twelve months to work on the technology to pivot over to an employer focus.
We were incredibly fortunate that it was a very similar experience. Servicing an employee wasn’t very different from serving an individual.
The experience you have as an individual is relatively the same regardless of whether you have an ACA plan or an employer plan.
The challenge then became that we just spent a couple of years figuring out how to do hand-to-hand combat within the consumer space, and now we had to figure out the best way to partner with benefit consultants.
Ultimately, we found that consultants were putting together the strategies for these customers. We saw they had a huge appetite for innovation and new solutions, but there wasn't something tying everything together. So, we were looking to solve that problem when we went live with our first employer customers on January 1, 2017.
Doug Morse-Schindler: I’d say 2016 was probably the darkest time for both of us. We were really focused on a certain market, had distribution within that market and then had to say, ‘Okay, the opportunity is no longer there’. We had to begin learning what employer-sponsored benefits were all about.
What is a broker? What's important to them? How do we best serve them? How do we work with them? We had to figure out those answers and re-tool the product while convincing our team the change we were making was the right one.
So that was a really trying year. The only thing that helped was I had confidence it was the right change and also a very necessary change. It wasn't like we had the option to stay where we were.
It was a matter of having many conversations with brokers and HR teams, and really trying to understand how to take this technology we’d built and re-tool it to provide the most value. We felt like we would make it easier to provide service and better guidance at a higher level and provide a deeper understanding of the plan design and networks.
Justin Holland: Soon after that pivot, around 2017, we ended up moving out of the house to an office nearby.
After we received financing from Chicago Ventures, we knew we’d need to move into an office because we were going to expand the team. We couldn’t fit any more people into this house, and we were at the physical limit of what we could do. There were desks on every floor of the house.
Doug-Morse Schindler: As I think about the challenges, another big one was understanding the seasonality and getting used to that. Every company in the benefits space has to figure seasonality out, and it takes years to get really good at capacity planning. We've learned a lot and we hope we learned from our mistakes.
Also, understanding the importance of distribution channels. I do think the channel in our space is so essential to success. Distribution is everything.
If I think back to some of the breakthroughs we've had, I remember hiring our first salesperson, Dave Mallen, in late 2017. Dave had come from the benefits space and had a broker network.
Going out on the road with him gave me a crash course on how brokers think, what's important to them, how distribution works and how to identify brokers we felt would be a good fit as our partners.
That was an “aha” moment.
That built the basis for what ultimately fueled our growth over the past five years.
Doug Morse-Schindler: That first sale took six months of work. Lots and lots of discussions and a lot of hearing ‘no’ frankly.
But, ultimately our first client was a brokerage agency based out of Minneapolis.
I started talking with them and ultimately developed a personal relationship to build trust. I think they believed in the overall idea of care navigation. But at the same time, they kind of took a leap of faith and believed we would figure it out.
We launched them on January 1, 2017, and I distinctly remember the week before that launch was stressful. I can't say we were fully prepared.
Everything at that point in the business was just last minute, and we used every second of the last week of 2016 to get them live on January 1, 2017.
But after that, the next 10 clients came way faster. It's just one of those things where your first is always the hardest — I'm sure it's like that in any business.
Then you get smarter and more confident and the dominoes just start falling. It's been like that over the last few years. After the first 10, you work to get to 100 clients, and then 500, then 1,000 and so on. But it was a real grind getting that first one.
It took everything we had to get our first client, and really those first 10. That's when we raised our Series A funding with Chicago Ventures — who I would say took a risk on us. Thank you, Stewart and team!
They believed we were going to figure it out and provided us with the capital to continue and invest in that first team that was going to get us from a few hundred thousand in revenue to $5 million by the end of 2019.
We could talk all day about what we’ve been up to over the past few years, but we’ll give you a high-level overview instead.
We included some links as well, just in case you want to dive into more details.
Justin Holland: The challenge in the backdrop of every single renewal discussion over the last few years is cost. It’s not sustainable for healthcare costs to outpace inflation forever. It just fundamentally won't work.
While rising costs present a very challenging problem, it's a problem that is exciting. It's such a vital part of a customer’s bottom line and the livelihood of individuals who should be able to exercise that right to be healthy. That’s something I get excited about.
Plus, in the backdrop is this massive cost inflation that some, if not all, of our broker partners are dealing with. They’re experiencing some of the harshest renewals they've ever had, and we know what happens when there's a high renewal — huge cascading amounts of challenges. Now we have to start thinking about change management and talk about changing networks and funding.
All of that stuff is hard, and it's at the worst possible time for our broker partners when all of their customers face the same issues at the same exact time. So it's all concentrated in this one critical moment, and our focus is helping mitigate long-term spend.
So, how do we make sure that employees are achieving cost savings? How do we make sure our benefit consultant partners are putting forth the best solutions to address high claims? How do we help them deliver that message and then help drive change at the employee level? Because our job is delivering that last mile of their benefits strategy.
Then we finally get to deliver consumer-grade technology for the members. They have expectations just like they do for Amazon or Uber. That's not easy, right? And unfortunately, healthcare has typically never been that simple, but we want to make it that simple for them. It’s gratifying to see a 94 member satisfaction score from our members. To me that means we are achieving our goal of making it simple.
We have to look at this full value chain to reach the final outcome. That's what kept us in the seat for 10 years. Doug and I continue to be excited about solving that problem every day.
Doug Morse-Schindler: The other interesting challenge is the lack of transparency and data persisting in this space. The way we look at it, we want to provide members with the most personalized experience. Ultimately, that's what's going to drive engagement and engagement is what's going to drive positive outcomes.
But it's been challenging, and I'm happy to say we've made a lot of progress in this area. There are still a lot of challenges, even to just get claims data.
As a result, we've innovated in areas and relied more on the members to provide us with information about what's going on with their personal health through our Member Health Goals questionnaire.
Data is improving over time. But there is no ubiquitous database providing you with all the information you need. That’s why we supplement external data sources with our proprietary health goals data to build a more comprehensive picture.
Thanks for taking a look back at 10 years of HealthJoy with us! Our vision is still the same as it was a decade ago: remove the complexity from being healthy and well. Going forward, we’ll continue to use that as our North Star.
To every member of the HealthJoy team, we couldn’t do this without your tireless work and passion for making healthcare more accessible.
To our partners, clients and members, thank you for trusting us to deliver an exceptional experience, contain costs and deliver some JOY along the way.
To anyone who has ever opened the app, given us a rating or recommendation or taken the time to stop by a HealthJoy booth at a conference, thank you. We couldn’t have done it without you!
Cheers to 10 years and celebrating many more strides in affordable, easily accessible healthcare.
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