If you’ve never heard of NaviNet, the builder of what the company claims is the nation’s largest real-time healthcare communications network, then the Cambridge, MA-based firm bears most of the responsibility, says company CEO Brad Waugh. The 11-year-old firm spent its first 10 years building the network and its customer base, and over the past year has the firm put a greater emphasis on telling health plans, doctors, and others about its multiple capabilities, Waugh says.
NaviNet helps doctors’ offices instantly access patients’ insurance information, such as their benefits eligibility and claims status, over the Web. So far it’s connected 770,000 doctors and other healthcare providers to the network, covering about 40 percent of the total market, according to Waugh. Big health insurers like Blue Cross Blue Shield, Aetna, and UnitedHealthcare are attracted to and use NaviNet’s services because they save money by accessing sharing information via the company’s Web portal rather than through costlier call centers, Waugh says. NaviNet makes the bulk of its money, he says, on transaction fees that insurers pay the firm to connect with doctors.
There are certainly other important details of NaviNet’s business to speak of. But the big question I had was how the company is adapting to the rapidly evolving landscape of the U.S. healthcare system, which is expected to undergo major reforms under the Obama administration. (Read on for my conversation with Waugh on this topic.) With the goal of driving down healthcare costs, among other things, the federal stimulus package passed earlier this year includes $19 billion in incentives for hospitals and practices that adopt electronic health records. While the exact rules governing how the money will be doled are still being worked out, Waugh says that his company already has the information “rails” over which the government and the healthcare system could move information smoothly and securely.
The 238-person company is already seven years into operating profitably, Waugh says, but because NaviNet is private, he doesn’t have to share actual financial numbers. He says the continued growth of the business will help support an eventual public offering. (I’m sure the company’s investors, such as Waltham, MA, venture firms … Next Page »
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