Perhaps one of the most financially troubling and stressful things that people have to deal with is managing their health insurance. Often, we get our insurance from our employers or through our loved one’s workplace and then get taken care of. But then again, there are those people who get insurance through other means who are also struggling to come to grips with their insurance and health care plans. No matter whether your plan is individual coverage or through your employer, the one thing that probably frustrates a lot of people is how can they manage it all. Well one particular company is trying to just that: Cake Health.
Health care’s outlook frustrates us all
According to a recent RAND Corporation study, health care costs have risen faster than the cost of other goods and services in the United States over the past decade. As a result, Americans have been left financially worse off. The research continues by saying that, in dollars, a typical family of four saw on average a monthly income growth of $1,910 over the past decade but spent 40% of it on health care costs.
“Accelerating health care costs are a primary reason that so many American families feel like they are just treading water financially…Unless we reverse the trend, Americans increasingly will notice that health costs compromise their other spending options.”
— David Auerbach, RAND Corporation study lead author and economist
What this clearly tells us, and what I believe everyone is aware of, is that the costs are too high for most families. But what’s more alarming is a report generated by the Commonwealth Fund in 2011, which raises some additional alarming statistics:
- 45% of the adults in the survey reported that they had a hard time paying their bills, even with health insurance, and had been contacted by a collection agency or had to change their way of life in an effort to pay their medical bills.
- Approximately 50 percent of personal bankruptcies are due to medical expenses.
- According to a Kaiser Family Foundation poll, 28 percent of middle income families (annual family income between $30,000 and $75,000) stated that they were currently having a serious problem paying for healthcare or health insurance.
- Health care benefits are an important factor in either taking a new job or staying with a current job. Approximately 25 percent of employed individuals choose employment based on better health benefits. (Source: Kaiser Family Foundation)
So now we’ve established the main idea here: health care costs have risen to the breaking point and something MUST be done to help curb it. And while our politicians can debate it all that they want, there needs to be some additional help in reducing the amount of money that we spend. Aside from the unexpected occurrences, there are a growing number of third-party applications being produced that are designed to help families and individuals manage their health care expenses. One of these is Cake Health, a startup from the San Francisco Bay Area, whose stated mission is to help accomplish five things: catch medical bill errors, never let you be surprised by your health care bills, save you money, track the real-time status of your plan, and know what your costs are.
Managing your health care is a piece of cake
Started by Rebecca Woodcock and Andy Brett and launched at the San Francisco edition of TechCrunch Disrupt, Cake Health’s desire is to make your life easier and bring order to the health care chaos. What do they mean by this? Simply that they feel that your health care is being affected by the excessive paperwork that you have to fill out before you actually get any real remedy or treatment. And for anyone who doesn’t have a medical or insurance background, getting those medical bills and statements isn’t an easy job to read. I went to get a routine check-up a few months ago and when I got the bill, it was pretty difficult for me to understand what it was saying. So now I have to go back to my physician and ask them to translate it? Or what about the next time I need something taken care of? Is my first option to go to my office’s human resource director to ask if a certain procedure or medicine is covered by my insurance? Maybe I just look at what’s on Cake Health to help me keep track of everything medically relevant so I don’t have more questions than I do treatments.
What was the motivation for this application? Ms. Woodcock started Cake Health in 2010 after observing how inefficient the current health care payment system was. Her understanding stemmed from personal experience as she witnessed a friend with epilepsy wade through the swamp of bills that flowed in for medical expenses. Her friend, who had a high deductible insurance plan, quickly exhausted his benefits with hospital visits, treatments, and expensive, ineffective anti-seizure medications. It seemed impossible to keep track of all the different types of services and costs. After months of personally documenting each seizure her friend experienced, did a neurologist notice the pattern of a specific type of epilepsy and change his treatment.
I recently signed up to get an understanding for what Cake Health really is and after looking through this service, in one way seems like the health care expense management version of Mint.com. And I’m not the only one as TechCrunch blogger Jason Kincaid (@jasonkincaid) also calls it the “Mint for health insurance” – quite appropo if you ask me. The information is all there right at your fingertips. All you need to do is sign up (it’s free) and give them your insurance company and related login information. They have most of the insurance plans in there – although I can’t say if they have all, but while they call out the most “popular” ones, you can add in your own insurance plan and it will pull up that provider. Then, most likely through the provider’s API, Cake Health will import your plan, claims, and information right into their system giving you a one-stop shop to look at your information.
Now I’m sure just by hearing that you just have to give Cake Health your login information for your insurance provider’s website gives you the chills. I mean, this is very, very private information – it’s not as if you’re signing in to have your tweets or photos imported to share with everyone. Privacy is a very serious matter when it comes to health issues and insurance. So what is Cake Health doing about privacy? According to what is on their Frequently Asked Questions page, they say the following:
Is my login information stored on your servers?
If you authorize Cake Health to automatically pull in your claim information, the credentials that you provide are securely stored on our servers. We have taken the utmost precautions to secure and encrypt this information. Even an attacker who gained access to the server itself would not be able to access this information.
Do you share my information with the insurance companies, or any outside party?
Absolutely not. Your personal information is precious and sacred, and yours only. The only information we share is aggregated data to show trends for research purposes and would never be linked to your identity.
Disruptive is a good thing for the health care industry
Too long has the health care industry been the desire for change. People continue to complain seeking reform and yet there are efforts being taken right now to change it only to meet with resistance. No, it’s not a political statement – just a telling of the way things are right now. But people can no longer wait for change to happen. And that’s where Cake Health comes in…it’s causing a disruption. The insurance companies are sitting on your data and there’s no innovation to make things easier for us to manage our own schedules, appointments, claims, and paperwork to be more efficient. Cake Health, called one of the eight startups shaking up the health care industry, is doing just that. Why can’t we make things easy for consumers and patients so that they’re not spending an enormous amount of hours trying to figure things out, whether or not they’re able to pay for that operation, or keep track of what plan can do what or how much did they pay versus their insurance. It’s all there in one system and it’s going to help reduce the burden for not only the insurance company, but also for the health care provider (your doctors and physicians) and also the most important person: the patient.
Besides, would any service in the health care industry really want to take advantage of emerging technology? Maybe, and some are really making strides, but Cake Health has given things a bit of an upheaval by also having an iPhone application that will make things more streamlined. This way you’re going to have your health insurance information right at your fingertips instead of you needing to go to a laptop and pull things up that are stored either in your email, desktop or personal files. And since it’s on the iPhone, you’ll get double the fun by being able to use it on your iPad tablet device – of course it won’t be fully optimized. It’ll even list out your plan’s benefits so you’ll never be in doubt about whether you’re covered or not. Genius, right?
As patients, we have power over our health care costs
The timing of Cake Health is appropriate and needed since costs have been soaring for the past ten years. And in a September 2011 RAND Corporation study, for those people under consumer-directed health plans, more are gaining control over their health care spending once they begin receiving a physician’s care. As part of the findings, two-thirds of the reduction in health care costs were from patients initiating care less often and the remaining third was from a reduction in costs after care was initiated.
“Unlike earlier time periods, it seems that today’s consumers can have greater influence on the level and mix of medical services provided once they begin to receive medical care,” said Amelia Haviland, the study’s lead author and a senior statistician at the RAND Corporation, a nonprofit research organization. “We found that at least part of the savings in cost per episode reflects choices for less-costly treatments and products, not just a reduction in the number of services.”
The study continues by saying that there were three contributing factors that influenced the cost of care once the patient had initiated care: lower use of name-brand medications, less in-patient care, and lower use of specialists.
Interesting, yes? Well wouldn’t something like Cake Health help you figure out what drugs or services you’re covered for? These things would be spelled out by integrating your Cake Health account with your insurance provider and getting all of that spelled out in an easy way for you (NOT your provider) to understand.
Bottom line: tackle your insurance and health care costs head on. Control what you’re paying and you’ll get more sleep at night not worrying about the discombobulation of how you’ll pay your medical bills.
Piece of cake!
Photo credit: sleepyneko / flickr.com
Disclaimer: I currently work for a pharmaceutical advertising agency as a digital producer. These words are my own and were not reviewed prior to publishing. I have not been compensated for this review.