Gamification Hits Healthcare as Startups Vie for Cash and Partners

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completing a 5K. New York-based Fitocracy is a social network where fitness fanatics can track their workouts, challenge friends to exercise “duels,” and earn public recognition for meeting health goals. And San Francisco-based Keas helps employers develop websites where their workers can earn badges, points, and other recognition for exercising and express support for coworkers who adopt healthy habits.

EveryMove CEO Russell Benaroya

Some of the new approaches to gamification have grabbed the attention of large insurers. In May, Seattle-based EveryMove raised $2.6 million, much of which came from BlueCross BlueShield Venture Partners and two regional Blue plans. The company has worked with Premera Blue Cross in the Pacific Northwest to test its platform, which offers online and mobile tools that allow members to turn healthy lifestyle choices into financial rewards.

Founder and CEO Russell Benaroya likens EveryMove to a mileage points plan. Health plans, large employers, or health-related brands will be able to award points to their customers based on whatever health goals they want to promote. If general fitness is the overall goal, for example, a health plan might give 60 points to a member who gardens for three hours, or 150 points to one who completes a triathlon. Members who earn a certain number of points could receive discounts, say, on their annual health plan premiums. During the beta, users are receiving gift cards from a regional drugstore, a golf training franchise, a bike shop, and other health-related retailers.

Benaroya believes such tangible rewards are crucial to keeping consumers interested in improving their health. “It’s hard to keep engagement up over time,” he says. “Health is a process, and process by definition takes time.” What’s the trick to achieving long-term engagement? “Subtle, unexpected rewards that are integrated into the fabric of how somebody already lives their life,” he contends.

Many people in the healthcare industry refer to the ability to keep consumers interested over the long run as “stickiness”—and most say it’s their biggest challenge. That’s why some health plans have brought the gamification effort in-house. Boston-based Healthrageous was incubated at the Center for Connected Health, a division of Partners HealthCare. The company makes devices that collect data such as blood pressure and weight from health plan members, which the plan can then use to tailor health-improvement plans to individual members.

“Only 9 percent of people who download health apps are still using them in the second month,” says Healthrageous CEO Rick Lee. “There’s a significant dropoff in stickiness due to the fact that it’s just not personal enough.”

The company has since spun out of Partners, raised $8.5 million, and is preparing to close a Series B in July, Lee says. Healthrageous has signed contracts with five large health plans to run pilot tests of programs that focus on encouraging healthy eating, exercise, and good sleep habits. Plans that sign on with Healthrageous are incentivizing their members with rewards ranging from gift cards, extra paid time off, or contributions to health savings accounts held by people who have high deductibles.

Healthrageous has run several trials to track stickiness. In 2007, the company tested its wireless blood pressure cuff with employees of Hopkinton, MA-based tech giant EMC. Participants had to test their blood pressure a few times a week and go online to … Next Page »

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