October 6, 2020

Why We Started Nava

Brandon Weber & Donald DeSantis

"Medical costs are a tapeworm on the American economy." – Warren Buffett

Imagine shopping for a product where it's nearly impossible to find customer reviews. Where you aren't  told the price until you've already paid for it. Where that price varies as much as 20x, depending on which state, city, and store you're in, and where there are no returns, warranties, or quality information available. What we're describing here is the every-day experience of most Americans navigating the US healthcare system, and this is our story about how we're setting out to fix it.

In 2019, Brandon tore his ACL while skiing. Uninsured at the time, he began shopping around for the best cash rates on the market for imaging and surgeries. He learned that the prices for an MRI ranged from $400 to $4,000, without any discernible difference in quality. It turned out that the cost of surgery varied wildly as well, from $7,000 to $60,000. Again, the skill of the surgeon seemed to have no bearing on price; there was even one surgeon who had two different prices for the two different clinics he worked from during the same week. That price difference was over ten thousand dollars.

We of course had heard of the systemic issues facing healthcare, but with these numbers in front of us, we couldn't get a logical explanation for how these massive price variations could exist for something as essential as healthcare.

So, we set out to find the reason behind the opacity and inconsistency of medical pricing. We spent the next year talking with doctors, hospital executives, insurance companies, employers, and everyday working Americans. While they all had different sets of problems, one thing was clear: The problem in American healthcare was much more complicated, and much more urgent, than we had ever imagined.

We learned that healthcare premiums have been rising at 5-6% annually, 300% faster than inflation and 50% faster than wage growth. We learned that employee deductibles have doubled in the last 10 years. We also learned that medical debt is the leading cause of bankruptcy in the United States; and that one in six Americans has medical debt in collections. But the most important thing we learned? It didn't have to be this way.

“The future is already here. It's just not evenly distributed yet” – William Gibson

It turns out that game-changing innovation exists in almost every healthcare category imaginable, from pharmacy to primary care to pediatrics, to insurance design. These innovators leverage cutting-edge technology, a consumer-centric approach, and novel business models to deliver vastly better outcomes for employees at lower costs, often saving them as much as forty percent off the cost of a needed procedure. These savings add up quickly across an entire organization, allowing employers to provide better health benefits for their people, which means employees can get the care they need at prices they can actually afford.

The obvious question is, "If this is all true, why isn't every employer doing this?" To answer that, we need to understand the peculiar way in which employer healthcare is bought and sold in the United States. Half of us get our healthcare through our employer — almost 160M Americans in total — and pretty much every organization, from a ten-person startup to a 50,000-person enterprise, relies on a "benefits broker" or "benefits consultant" to select and implement healthcare plans. These brokers are typically paid on commissions from the insurance carriers. They work very hard to win new clients, and then do everything possible not to lose them.

Benefits brokers are the key to unleashing healthcare innovation.

Benefits brokers act as the distribution layer for the industry, determining which solutions get presented to employers and the level of support it needs during deployment and ongoing use — ultimately determining its ability to scale. But, as the complexity of healthcare rapidly increases, brokers lack the tools and support required to deploy these innovative solutions at scale, which means they are unlikely to be seriously considered.

We've seen first-hand that the country is filled with incredibly innovative healthcare providers — there are hundreds, if not thousands, of them offering solutions capable of changing the lives of their customers. But, what's missing is a company that can bring this innovation to scale, to amplify the positive outcomes delivered by these benefits solutions to employers on a widespread basis.

So we launched Nava, a new kind of benefits brokerage. We're arming small-to-midsized employers with the modern tools, year-round employee advocacy, and ongoing measurement they need to deliver more valuable benefits for their employees while lowering overall plan cost. And for benefits brokers, we want to empower them do what they do best – produce great outcomes for their clients – by supporting them with a best-in-class lead generation, client success, and employee advocacy platform.

We are no strangers to tackling industries that seem immune to change. Our last company set out to transform the change-resistant commercial real estate industry, a $16 trillion dollar asset class. In six years, we went from a whiteboard idea to a billion-dollar business powering over half of all the office buildings in the United States. While this was an incredibly rewarding journey, we both knew that our next chapter would be to solve a broad societal problem.

Nava is on a mission to bring high-quality, affordable healthcare to every American, and we're starting with the 160M Americans who get their healthcare from their employer. Our team brings together experts from pharmacy, insurance, benefits, and software to transform how employers and employees buy and utilize healthcare. We know that this will be challenging — and may even frustrate a few juggernauts along the way. But, we believe that with enough time, resources, and talent, our mission is achievable. And it starts with fixing the go-to-market channel for innovation in healthcare.

We are growing quickly. Our initial customers range from publicly-traded technology firms to blue-collar manufacturers. We are hiring for every role, from product and engineering to sales and brokerages. If you would like to see what our team can do for your company, or if you are interested in a career at Nava, please drop us a line at info@nava.io.

Brandon and Donald

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