A health-tech startup, Grand Rounds, Inc., recently got $40 million in new venture financing for its version of a “virtual consultation.” It sells an online medical consulting service that it describes as having the best specialists from the best hospitals in the U.S.
No travel is required: Use a laptop or a mobile app to find expert medicine, the company says.
The San Francisco-based start-up intends to use the money to improve its technology and extend its reach to 5 million people, up from the current 1 million people. The vast majority are covered under Grand Rounds' group contracts with 35-odd employers, including Jamba Juice.
Grand Rounds' underlying premise is that better doctors produce better results—and that top experts in a particular field almost certainly know how best to handle complex conditions, and at lower cost. It cites average savings of $10,300 per case on Grand Rounds opinions. That includes savings from fewer surgeries, fewer complications and less absenteeism.
“Folks see us as a way to ensure, at a high level, that [their] employees are receiving world-class health care,” said Evan Richardson, Grand Rounds' vice president of product and customer experience. “We are by no means a replacement to their traditional health insurance,” but are an added layer to benefits.
Another Grand Rounds executive has described it as being the “Navy Seals” of healthcare: working on the toughest, most complex cases. The firm said its specialists make a major change in diagnosis and subsequent treatment in more than two-thirds of cases.
A year ago, ConsultingMD changed its name to Grand Rounds after raising $10 million in venture funding earlier in 2013. When the business launched in 2011, it began its second-opinion product with about 250 specialists in its network. Now called Grand Rounds Opinions, it is sold directly to consumers, but its primary sales channel is to employers of 300 workers on up. And the firm has added two more components to its core offerings.
Focusing on elite consultations
Other start-ups, such as ZocDoc, connect patients through mobile apps to appointments with dentists and doctors for services. But Grand Rounds focuses on elite consultations; when it highlights cost savings from its second opinions, it uses renal cell carcinoma, mitral valve repair, spinal stenosis and recurrent skin cancer as examples—not necessarily run-of-the-mill conditions.
Richardson told Healthcare Dive that Grand Rounds sells a speedier, more convenient version of “virtual” online second medical opinions also offered by major institutions including The Cleveland Clinic. Grand Rounds takes days, as opposed to weeks for major institutions' opinions, he said, and it collects and delivers patient records, whereas patients must do that themselves with other services.
According to its website, the Cleveland Clinic charges $565 for an online medical second opinion; $745 if a pathology review also is needed. Clinic officials declined to discuss the program's particulars.
By contrast, Grand Rounds, while stressing that its focus from the beginning has been on selling to employers, charges $7,500 to individuals for a Grand Rounds Opinion, which includes a myriad of support services. It costs $200 for a Grand Rounds Visit, in which the firm locates and schedules a priority face-to-face appointment with a specialist in the patient's area. Richardson said the firm uses its algorithm to find two specialists for the patient to choose between, thus preserving patient choice.
When a specialist is chosen, Grand Rounds collects and delivers medical records for the scheduled visit, after the patient signs a HIPAA privacy release; the firm said it also follows up with the specialist to ensure the appointment went well.
Across services, each patient gets a care coordinator/personal assistant, and Grand Rounds assigns a board-certified staff physician who handles the case by phone through treatment and recovery. Richardson said these doctors “often spend hours answering patients' questions and follow up after the opinion” is delivered. A flat rate gets the patient through the episode of care.
Grand Rounds' expert opinions generally take seven to 10 days to reach a patient's hands, Richardson said. The firm recently introduced Grand Rounds Stat for when time is of the essence: real-time, physician-to-physician consultation for patients facing life-threatening or complex conditions.
For employers, Grand Rounds' cost varies by size. Generally, companies with fewer than 1,000 employees pay about $10 per employee per month to the firm for the “full outcomes management” benefit; employers with 2,500 to 4,999 workers pay about $6 a head monthly.
Stripping away bureaucracy
Grand Rounds uses about 1,000 specialists for its expert opinions, “so it's the top 0.1% across each specialty and sub-specialty,” Richardson said. He said doctors agree to the work because it allows them to view medical records of interesting cases and write opinions on their iPad or laptop. “We've really done everything possible to make this an easy, seamless process,” he said. “We strip away the bureaucracy and give physicians a way to interact with interesting cases at a convenient time.”
To find experts, the firm uses a 13-point algorithm that analyzes factors such as where physicians attended medical school and trained, their current institutions' strengths and patient outcomes, he said. It culls from the 520,000-odd U.S. specialists, excluding primary care physicians.
Grand Rounds describes using “top experts in their field” from big-name places including Harvard, UCSF, Yale, Northwestern, Mayo Clinic and The Cleveland Clinic. But Richardson said they are drawn from outside major institutions, too, “because the reality is, no institution has a monopoly on quality.”
According to spokesperson Stacy Page, Grand Rounds' specialists set their own prices and are paid on a per-case basis; the company won't disclose what it pays them. They are not on-call 24/7, although the firm stays in close communication with them about their availability. Yet customers almost have 24/7 access to the firm's staff physicians, she said, and can get time-sensitive consultation from staff doctors and available experts through Grand Rounds Stat.
Asked about getting buy-in from treating physicians, Richardson said Grand Rounds doesn't challenge treating physicians. But in some cases, if care is poor, the firm does tell patients that “they have a lot of options,” he said, “and if a change of care is appropriate, we'll find another doctor for them to see.”
As for privacy concerns, especially with mobile devices, Richardson conceded: “That is a great worry, and I think it's an important thing to be thinking about [but] we've spent a lot of time on tech security.” He said the firm aims to keep information “heavily protected” and tries to lock down as much as possible with encryption, typically exceeding HIPAA standards. He said the firm has been audited by several large employers regarding security, and has exceeded their own cybersecurity standards.