Physician Search Tool BetterDoctor Adds Medicare Data, Raises $10M

7/15/14Follow @xconomy

Ari Tulla, CEO and co-founder of BetterDoctor, knows what it’s like to need a good physician in the midst of health turmoil, when patients are often at their weakest. “There is a long history of medical struggles in my family,” Tulla says. “My wife had been ill for many years. I wanted to build something better.”

So he and co-founder Tapio Tolvanen started BetterDoctor, a listing and rating service that leverages data from Medicare to help patients find the best physicians for them. Instead of having paid listings or ads, BetterDoctor filters its physicians based on proximity to patients, specialty, and insurance plan. In addition to listing education information, doctor profiles use Medicare data to tell patients how many of a given procedure the doctor has preformed, how many patients he or she has treated, and the price they charged Medicare for a particular procedure.

Three years after the co-founders started the company, BetterDoctor has helped 10 million people find physicians, Tulla says, and is today announcing a Series A round of $10 million led by New Enterprise Associates.

I caught up with Tulla two years after Xconomy first profiled the company to talk about the exploding online medical space, the company’s growing competition, and how data from Medicare can help inform patients about procedure pricing. Here is a lightly edited version of our conversation.

Xconomy: You recently added newly released procurement, payment, and referral data from Medicare. How does this help patients choose their doctors?

Ari Tulla: The first bit of data Medicare released was referral data between doctors. We now know which doctors are referring to which doctors. We also understood this data works a lot like Google page rank. They look at how many links you get inbound, how people behave, etc. The inbound link is the most important metric for the ranking. If you are a doctor who has 250 doctors referring to you, we know you must be good at something. Then we look at how good these doctors are who are referring to you and that will give you even more value. That’s the element we got a while ago. We put that live as part of the BetterDoctor ranking algorithm.

Three months ago we got another batch of data—claims data from Medicare. We have a full list of about 800,000 doctors and all the procedures they performed for Medicare and Medicaid patients in 2012 and 2013. We also see the price they were requesting. You can have a full view of the pricing at the Medicare level. There are about 160 million referrals that are part of first database. In the procedure data, there are more than 10 million lines of information about doctors. One cardiologist has done more than 100 kinds of operations over 11 times each. It’s data about 30 to 40 percent of the whole healthcare system. It’s not like a sample. Before this data a lot of the media was relying on surveys of 1000 people. Now we are seeing 30 to 40 percent of the universe with real data. That’s quite transformational.

X: What can Medicare pricing data tell patients who aren’t on Medicare?

AT: You have a medium size hospital. They have a price master. That price master defines how much each and every patient will pay, or how much an insurance company will pay. Medicare, of course, is the biggest entity—bigger than any insurance player. The price [Medicare pays] is somewhere between 60-70 percent lower than that price added into price master. That’s why Medicare is not really liked by doctors. But it’s a really big part of the system. [The data] gives us an idea on not just how much Medicare is billing but also Medicare payout. But more interestingly, it gives us an indication of how much each individual doctor is billing Medicare. If that doctor or that hospital happens to be more expensive than the other one, it gives you a sense of how much they charge.

With this data you can have an understanding of the whole market. There are expensive doctors and hospitals and lower priced doctors.

X: Has this pricing data been available before?

AT: For hospitals, definitely, yes. Doctors, that’s something nobody has done yet. On our site right now you can see prices doctors are billing, not what they’re getting paid. We haven’t yet had time to distill into that. Our data science department is looking at that today.

What you want as a user is a simple way of understanding how much something costs, like dollar signs on Yelp. One or two or four. And that will indicate to you how expensive that restaurant will be roughly. You don’t need to know the exact pricing. At minimum, we can create a value for money type of index. What doctors are high quality but low-priced? Those are the things we’re looking to do now.

X: How many doctors do you have on the site now?

AT: 1.1 million. It’s pretty much every doctor in the country, including dentists and alternative medicine practices. Each doctor can become a member of the system. This is all free. But doctors can pay for improved visibility and better showcasing. They can edit their profiles, see analytics, add elements, and take ownership.

X: This space has changed a lot in the last couple of years. Who do you see as your competition?

AT: There are two kinds of companies. One set that will emerge is in the bookings space. The marketplace where you facilitate connectivity and transaction between patients and doctors. ZocDoc is a key player in that space. They did a great job in starting the market. Then companies who are doing more classic directories where they make money with ads. We have decided to have no advertising. That’s the mandate we have. It dilutes the value of the service.

X: Do you expect to add online booking as a feature?

AT: We absolutely will. We already have testing running, but nothing at nationwide scale. The doctors like it. It’s lowering overhead and making their lives easier. At the same time, what we have learned while doing this testing is in many cases you don’t care about online booking if you have something complicated. You’re not going to book a heart transplant online. For an annual physical or dental appointment, it makes sense.

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