Which would you prefer: high-quality health care without the co-pays, deductibles, and administrative hassle, or, in the words of one Google veteran, a high-tech “doctor’s office that looks more like an Apple Store”? Adrian Aoun, the cofounder of Forward, a newly launched primary care startup, doesn’t think you should have to choose.
But you’re going to have to pay for it: $149 per month for your primary care needs.
Forward is the latest new startup to experiment with “direct primary care,” a model that trades “fee for service” billing, meaning payment based on pricey tests and procedures, for an approach focused more on health outcomes. The idea is to have doctors stop taking insurance and instead charge patients a flat monthly or annual fee. Theoretically, that frees up doctors to focus on their relationships with patients while curbing administrative overhead.
Aoun, a Google veteran, is aiming to give direct primary care the high-tech touch. Forward offers members standard medical services alongside genetic screening tests, body scanners, wearable sensors, artificial intelligence software, and a homegrown electronic medical record system. Membership also includes labs, travel vaccines, and ultrasounds (with X-rays on the way). It’s a bit like technology-driven primary care group One Medical, which has quickly grown to more than 50 practices across the country by offering features like online booking, virtual visits, and same-day appointments. The key difference is that One Medical accepts most forms of insurance, and it offers those who lack insurance a $175 initial doctor visit and $125 for subsequent appointments.
Forward’s founders are big names in Silicon Valley’s tech community–Aoun ran special projects for Google, and his cofounder, Ilya Abyzov, is a former Uber executive–but both are fairly new to the medical sector. As is the case for many of his fellow technologists who recently moved into health care, Aoun started the company after a personal brush with the broken system. In this case, it was a close relative who had a serious cardiac event and landed in the emergency room. “The bill was the second heart attack,” he recalls. “I couldn’t believe that what you pay for is the extra days in the hospital [and] the duplicate tests.”
In the aftermath that experience, Aoun concluded that the typical doctor’s office really did need something of an “Apple Store” makeover. He raised an undisclosed sum from Khosla Ventures, Founders Fund, John Doerr, First Round Capital, and others to get it started. Fast Company toured Forward’s swanky first office, in downtown San Francisco, a few days ahead of its official opening. It certainly pays homage to the iPhone maker with its minimalistic white walls and an iPad station where members check in.
But technology isn’t a silver bullet in health care–it rarely drives down costs (typically, it’s the opposite). Far more interesting is the company’s bet that direct primary care can go mainstream. Direct primary care started in the mid 2000s, modeled after concierge practices that cater to the wealthy but at a lower cost. It is an increasingly popular option for patients, but the percentage of doctors involved still remains very small. “The innovation in direct primary care is the business model,” says Zak Holdsworth, CEO of Hint Health, a company that works closely with direct primary care practices. “Tech is just a way to scale the model.”
Holdsworth and others say that Forward is one to watch, in part because it has far more capital behind it than the majority of other new primary care groups. Recognizing that it’s still early days, here’s some food for thought as the company attempts to scale its model:
$149 per month is expensive relative to many other direct primary care models and is more in the range of a concierge practice, says Holdsworth. The average fee his clients charge is in the $50–80 range. Aoun says the price will come down over time, “as we give our members unlimited access to our doctors and our tech.” And for now, Forward is also offering some free memberships to those who can’t afford the fees.
Some experts believe that Forward would struggle if it doesn’t reduce the price, especially if it opens practices outside of San Francisco. “It’s not easy getting people to pay for a product they have been accustomed to having someone else pay for, like an employer,” says Jeffrey Gold, a Boston-based physician who started a direct primary care practice. The challenge for Forward, argues Gold, will be to recruit enough “low maintenance” patients that balance out the ones with expensive needs, especially with the overhead of supporting high-tech equipment.
Of course, it’s totally plausible that tech workers in the Bay Area with six-figure salaries will choose to invest in their own primary care. And with enough of those people, it’s a potentially solid business. It remains to be seen whether Forward can recruit significant numbers of patients with multiple, expensive chronic conditions who are struggling to make ends meet. After all, these are the patients that could benefit the most–and they drive the lion’s share of health care costs.
A big part of Forward’s mission is to drive down costs by offering access to preventative medicine. Genetic screening tests and regular lab tests for a wide variety of biomarkers might seem like no-brainer precautions, but medical experts like H. Gilbert Welch have argued that rigorous testing doesn’t necessarily make us any healthier.
When doctors look too closely for diseases by tracking an extensive range of factors, they almost always find something (and that includes false positives, which often require more tests). Clinicians don’t know whether these patients will present with any abnormalities in the future, but patients tend to want further tests and procedures just to make sure everything checks out. And that often comes with side effects.
Take this writer as a case-study: As a 29-year-old female with few health conditions, the range of preventative tests recommended for me by the Department of Health and Human Services website is actually very limited. A far longer list of tests falls into the category of “uncertain” or “not recommended,” due in part to the lack of evidence. “Over-testing and over-treatment costs so much that I worry it will cause us to not be able to treat the people who actually need it,” says Dave Chase, a health care investor and advisor.
One regulatory expert I spoke to, who requested anonymity to avoid “angering rapid direct primary care” proponents, made the point that satisfied patients who are willing to pay a monthly subscription fee aren’t always receiving optimal care. Sometimes doctors have to disagree with their patients or make recommendations they don’t want to hear (like a lifestyle intervention, rather than a magic pill). Will these patients continue to subscribe to Forward?
Some direct primary care groups are working with Medicare and Medicaid to bring their model to the masses. One notable example is Iora Health, which contracts with employers and unions in order to serve patients that are most in need.
While this isn’t Forward’s approach (at least not for now), Aoun still believes that Forward can reach a broad range of users, regardless of age and health conditions. Still, for now, the practice seems to have been designed with younger users in mind. (As he puts it, “it’s what we would want as customers, so we built this for ourselves.”) Millennials aren’t the easiest demographic to court.
“The reason why urgent care centers have been so successful is that most young people want to forget about their health problems,” says Jay Parkinson, founder of Sherpaa, a company that works with employers to cut costs through virtual visits.
Aoun is making a bet that many of his counterparts aren’t actively in engaged in their health care, because the experience is so awful. To change that, the company has clearly invested a lot of time and effort into the member experience. For instance, in lieu of those horrible, exposing robes patients usually have to wear for exams, Forward offers comfortable workout gear.
Thanks to medical scribes, doctors at Forward can spend quality time with their patients, rather than inputting notes into a medical record. And the majority of people’s health needs can be dealt with under one roof, unless they need to see a specialist. By having doctors actively engage with patients via the mobile app or by tracking the data pouring in from their wearable devices, Aoun is hoping to get patients thinking more about their health between visits. “We do want to make health care delightful and convenient, and we don’t try to up-sell you,” Aoun says. “We can change the negative association in peoples’ minds.”
What are your thoughts on Forward? Would you pay for a service like this? Tweet me at @chrissyfarr.