MyHealthMath Emerges from Stealth Mode to Demystify Health Insurance for Employees

MyHealthMath is the third of five companies to be announced as a 2019 Startup to Watch. Maine Startups Insider is announcing one company per week throughout the month of September. For more on how the companies were selected for the list, please visit this page.

Every enrollment year, employees across the country start with a noble goal—to review their health insurance plans and make the most informed choice possible about their coverage. Most emerge from the labyrinth of premiums and formularies and co-pays more confused, and succumb to inertia and just stick with the same plan they had last year. Worse, many never begin the research in the first place.

Ninety-two percent of employees enroll in the same plan year after year, according to a 2017 report from AFLAC. But several economic studies have demonstrated that most employees are not good at choosing the plan that would save them the most money.

MyHealthMath, a Portland-based startup, aims to demystify the process of selecting a health insurance plan. The five-year-old company, which only recently emerged from stealth mode, is tackling the problem by combining the power of big data and machine learning with a personal touch. It gathers relevant details from employees and, using a proprietary algorithm, crunches the numbers that matter, allowing people to better understand their options and make choices in their own best interest. It collects data along the way to help companies make better decisions about plans to offer.

When people understand their options, they make better choices, which in turn saves them and their employers money, according to Bob Watterson, the company’s founder and CEO. Many of the people who have worked with MyHealthMath have been able to reduce their annual health care costs, save money, and make sure they’ve chosen the coverage they need to feel more confident about their health and wellness, he says.

“Literally every employer in the United States could use what we’re doing, and every employee,” Watterson says. “The scale potential is very attractive, and beyond anything I’ve ever been involved with.”

The company has already begun gaining traction. It’s projecting $1 million in sales this year, about 2x growth over its 2018 numbers. The company isn’t profitable yet, but Watterson, who bootstrapped the company for its first two years before taking venture capital, is in no rush.

“Investors and management are comfortable going after market share at this point,” he says.

An ALgorithm and a personal touch

Watterson honed his skills in the mortgage business in Massachusetts, where he developed an algorithm that helped consumers understand which mortgage product made the most financial sense for their unique situation. Watterson eventually sold that business to a bank before moving to Maine and turning his attention to health insurance. While running his mortgage business, he gained first-hand experience with the challenges employees face choosing the right health insurance plan. So he decided to build a new company around a similar algorithm that would help employees select the right health insurance plan for them.

“We provide tens of thousands of calculations to a consumer about their health usage so they can determine what is financially optimal based on the set of plans they have,” he explains. “Our algorithm is like a forward-looking claims engine.”

The key to MyHealthMath’s insight is the quality of its data, which they collect through a highly targeted personal conversation between an employee and a MyHealthMath analyst trained by a physician manager. After five years of developing and honing a proprietary script, MyHealthMath analysts are able to conduct most conversations in eight to 12 minutes. Keeping the conversations short is the only way they’re able to meet their goal of speaking to every single employee. Watterson says that there’s no comparison for the individualized data they collect in the course of that chat.

“This is where our role as a neutral third party is important,” Watterson says. “We’re not counseling—we’re calculating. People get a clear and impartial perspective on their options. Scheduling an interview helps break the inertia that comes with choosing a plan, and people leave the call in a different, more confident, mindset about their health insurance purchase.”

While the benefits of the MyHealthMath calculation are obvious for employers and employees, Watterson says that health plan carriers also want to play.

“You tend to hear that health plans want people to over-buy insurance, but that erodes trust over time,” he says. “The plans want transparency.”

For the first four years of business, MyHealthMath did direct sales. But Watterson says they couldn’t move fast enough to take advantage of the opportunity, so began looking at forming distribution relationships with insurance carriers that would allow them to take advantage of the force multiplier provided by their sales teams.

MyHealthMath has given Harvard Pilgrim a one-year limited exclusive deal, which included testing the service on its own employees in open enrollment. Harvard Pilgrim CEO Michael Carson was impressed enough that he’s joined MyHealthMath’s Innovation Council.

“MyHealthMath is an important partner for Harvard Pilgrim, where we have a goal to significantly transform our relationships with client employers and their employees,” Carson says. “MyHealthMath is helping us do that in a unique way.”

Attracting talent

As the company emerged from stealth mode, it has been ramping up its hiring. The company currently employs 15, but Watterson expects headcount to be closer to 35 in a few years.

One of those new hires is Elizabeth Coté, who joined earlier this year as MyHealthMath’s Chief Mission Officer and Medical Director. Coté was born in Maine, but left to pursue a successful career in healthcare and healthcare policy that took her all over the world, from post-war Iraq and post-earthquake Haiti to Paris and the White House. Coté is a physician who attended Harvard Medical School. She also holds a Master in Public Policy degree from the Harvard Kennedy School. She has spent the last 20 years working in direct clinical care and health policy systems alignment, including work in Presque Isle with the Aroostook Band of Micmacs and as a White House fellow under Kathleen Sebelius. She was recently selected as an Aspen Institute Health Innovation Fellow.

After work in many different spheres, from international and national policy sectors to clinics and local arenas, Coté was drawn to the opportunity to innovate in a startup environment.

“From a mission-oriented standpoint, what I love is that this is about the wellbeing of a family,” Coté says. “Premiums are escalating for employers, and employees spend upwards of 40 percent of their incomes on health insurance, and yet people are making gestalt decisions about their plans because the choices are so confusing. This is a kind of bedside care, because we’re ultimately helping people access better care. This is one empathetic interaction, translated to actionable data that already belongs to the consumer, that helps everyone make better choices.”

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