Even with a background in social work, Soda Health CEO and co-founder Robbie Knight said it was difficult to help his father create additional benefits when he became eligible for Medicare.
“What really hit me hard there was that despite what we’re doing to make our lives better and really impact health more broadly in the U.S., the challenge is that we still have a lot of people , who experience very basic challenges in their day-to-day lives every day,” he said.
Last year, Soda launched with the goal of making it easier to access benefits for healthy foods, over-the-counter medications, and transportation. The startup recently raised $25 million in a Series A round of funding.
Knight sat down with MobiHealthNews to discuss how Soda’s model works, why beneficiaries often don’t have access to these programs, and how the company plans to use its Series A funds.
MobiHealthNews: What are some of the problems you face accessing extra benefits as a Medicare Advantage or Medicaid member?
Robbie Knight: It depends. It is a mosaic of services. So you have everything from an over-the-counter catalog where health plans mail it to members every year. And as part of that process, members identify what they want, fill out a form and send it back. Using this is terrible, isn’t it? This is not a great experience for members. All the way from that, to basic call center execution, to basic retail execution. It’s really confusing which retailers to use and even which items are eligible.
So what’s happening is specifically for Medicare Advantage for OTC, only 30% are used. The other problem is that at some point you don’t need more Tylenol. You don’t give a starving man a blanket, you give him food.
It’s a one-size-fits-all approach where people just get OTC products and the usage is really low and the engagement is low because it doesn’t really address the immediate needs that people have in front of them.
MHN: Can you tell me a little bit about how Soda Health works, both from a patient perspective and from a health plan perspective?
Knight: Health plans have subpopulations of members to whom they want to provide these benefits. We work with them to determine what benefits they should offer most effectively from their perspective and ensure members have the most dollars they need.
As part of this process, we have what we call a flexible map. So we send out communication to members with that card — through our health plan partners — and then members get that card and a welcome kit in the mail. Both physical mail and they also receive other notifications. The member then activates it and goes to our member portal to determine what additional resources they are eligible for and then see how they can use their existing benefits in a much easier and more user-centric way.
MHN: When working with health plans to find out what benefits they should offer, how do you determine that?
Knight: One of the interesting things about the way this process works right now is that it’s too often commercial advertising. And what we’re seeing in this space is that OTC is important. It’s factually correct to say that if you have an OTC benefit or some benefit versus no benefit, you’re likely to be healthier. The question is what is the actuarial value? And what is the ROI [return on investment] related to making certain trade-offs that a health plan must make to manage its profits and losses [profit and loss statement] and help their members improve their health outcomes?
And so we say, hey, health plan, based on the market in your region and based on the types of members that you have and their needs that we see here, these are the types of benefit packages that we offer on the front end and I recommend you. Here’s how the math works. And that’s how we can optimize everything else downstream to make sure, from the cost profile, that what you’re doing is sustainable, it’s competitive in the market, and that it enables additional funds that we unlock later once we identify the needs of the members that exist.
So we can be really flexible in helping members when they have a housing problem or when they have a transportation problem. They won’t go to their annual wellness visit because they can’t actually get to the doctor because there’s no transportation. For us, that’s how we can identify what those points are and make sure that the health plan is spending those resources most effectively to help that human being on an individual basis.
MHN: You worked at Walmart. How did this affect the development of Soda?
Knight: So I would say two experiences have emerged in the perspective I have today. First, my background as a social worker, understanding really intimately the needs of everyday people, and what I experienced growing up.
During my time at Walmart, it was really helpful because it allowed me to understand the scale and how different markets move. Walmart has provided a really fascinating understanding of the nuances of different business models and how scale works in a way that no one else can because of the reach they have in the market.
MHN: So you just announced your $25 million Series A raise about a year after launching. How do you plan to use this investment?
Knight: What we’re doing for our Series A is continuing to expand the organizations and retailers that we connect with so that people have places to use these cards, access these resources and identify new resources, for which they are eligible.