Connecting people to healthcare without selling your soul [SPONSORED]
It’s not everyday we meet bootstrapped entrepreneurs who within two years have not only built a profitable company, but have done seven figures of revenue on a single day.
But that’s HealthNetwork-- a company based in Florida, that’s never raised outside capital, and has found a lucrative niche in connecting individuals with health care in the wake of the Affordable Care Act.
The company’s edge: Refusing to engage in the scummy lead generation schemes that roil the industry right now. There are hundreds of sites online that will collect your personal data-- and way too much of it-- then sell it to a dozen insurance brokers who will bombard your phone with cold calls. They’re paid not on conversion, but just passing on a bunch of info.
HealthNetwork’s constellation of sites aimed at various niches like urgent care and the Hispanic market can serve as a wall between customers and the insurance industry, passing on info only when the customer says it’s OK, and getting paid only when someone enrolls. Because HealthNetwork isn’t a broker, it has no conflict over what plan it guides consumers towards.
Up until now, the company played the Google keyword game to grab as many customers as possible by operating close to a hundred domains under specific and niche names like Obamacare.net, SubsidyCalculator.com and HealthInsuranceMarketplace.com. But in late September, the company is rolling out one central, customer-facing site under the HealthNetwork.com name.
What started as an experiment that founder Sean Sullivan dumped his life savings into, has grown rapidly into a profitable business. And one that’s pissing off a lot of the lead generation business it competes with.
In this sponsored post, we spoke to the founder Sullivan about building a very un-Silicon Valley company in a very un-healthcare marketing way.
Sarah Lacy: Why did you feel compelled to build this company?
Sean Sullivan: It was a great opportunity in terms of opening up healthcare to everyone, even people with preexisting conditions. That’s really how healthcare should be.
Working as a former competitive intelligence analyst with a background in vertical marketing companies, I was inquisitive about what was going to happen in the industry. I started calling people and everyone was saying it was just going to be business as usual, but that didn’t seem to address a whole new influx of users, most of whom had never bought their own insurance in their life.
I figured with the influx of millions of people coming into a market place, it was going to be chaotic not only for those people but for the companies trying to serve them. I didn’t see how it could be business as usual.
So we started to dig into what the existing pain points were between agents, brokers and carriers in the insurance space. We wanted to create a solution that protected the customer. The end result is we’ve gone from a zero to eight figure revenue company in two years with no experience with no funding at time when other companies are raising tens or even hundreds of millions in venture capital with no eye towards profits.
We have almost a militant attitude of just doing what’s best for the consumer. In one sense that makes my job easy, but at the same time there are a lot of existing companies who hate us because we refuse to play by the traditional rules of the lead generation business.
SL: Let’s take a step back. How was the insurance industry anti-consumer before? What was the problem you were trying to solve?
SS: From the consumer perspective there were two problems. You have a lot of marketing companies collecting information - asking for BMI or height and weight to figure out if you are obese or straight up asking people outright if they have preexisting conditions. I believed that if you are a marketing company, it’s none of your fucking business. Straight up.
Companies operate Web sites and ask people to fill out a lead form that’s then sold to the insurance agents trying to sell you health insurance. The consumer’s goal is to obtain insurance, but I think if people know how many companies they’d be sending it to, they wouldn’t fill the form out.
Insurance agents don’t want to buy access to leads who have already been contacted eight times. The carrier doesn’t want a marketing company to list preexisting conditions that they legally shouldn’t know about. As you have more and more of these companies cropping up out nowhere, it’s just been a marketing leads free for all. There are a lot of people in it to get rich quick and get out. That makes things difficult for the majority of companies who want to operate ethically.
SL: So far you’ve taken a strategy of operating via lots of different sites with different URLs to reach people. Now you are moving to a centralized HealthNetwork.com site. That’s certainly not a traditional approach. How does it work?
SS: When you target a niche you can go after specific keywords. We were really early on with Spanish language sites. We didn’t want to put all our eggs into one basket. Some of our sites rank organically, and some of them don’t. Now we are pulling back the covers and saying, “Hi, we are Health Network and this is our main consumer facing site.” We were building as we went out of necessity.
SL: How do you make sure you aren’t being tarred with the same brush as the rest of the lead gen industry?
SS: I get upset about it. I was actually just at a conference last week in the group insurance space, and I made it very clear: We are not a lead gen company. We are conduit for healthcare. If someone wants to piss me off: Call us a lead gen company.
SL: But you are essentially connecting consumers with insurance. How is it not lead gen? To you, where is that line crossed?
SS: With us, you decide how you want to enroll with health insurance. Whether it’s online, on the phone or even face-to-face. We are not passing on a lead, we are guiding you to that end result. We literally do not sell leads. We are not a broker. So we don’t have the conflict of interest a broker does.
SL: So how do you make money?
SS: Companies are paying us per conversion, but we don’t take a commission on just passing on leads. If we were just treating you like a lead we wouldn’t care about whether you wound up enrolling. We monitor the call quality of how many calls we have sent to what partner and how effective they are. We will follow up, asking how the experience was. We’ve dropped some companies because the experience wasn’t good.
Agents can be aggressive. They’re sales people. We allow customers to opt in to being OK with someone following up with them, but we also provide a wall between the consumer and the agent. Most of the time, we are connecting the consumer with one of our larger partners who we believe operate in very ethical ways. If the consumer really wants to ensure no one reaches out, we have developed a solution for that too.
SL: Beyond your own business, what are other ripples from the Affordable Care Act that people don’t expect?
SS: Telemedicine is going to become a much, much larger way to make sure people deal with problems.
But the biggest thing is that no one can penalize you for pre-existing conditions. I got introduced to this guy who was diagnosed with stage four colorectal cancer. He said some really powerful stuff to me. He was 45 and wasn’t worried about health insurance and the next thing you know a doctor is telling him he has two years to live. I’m really happy to say I just talked to him a little over two months ago, and he ended up going to a specialist in New York and he’s in full remission. That guy went from a certain death diagnosis and now because the ACA doesn’t allow pre-existing conditions this guy is going to live.
He said at 45, he wasn’t really thinking about his own mortality but one of the first things he thought was he might not be able to see his daughter walk down the aisle. That hit me really hard. When I met him our company was seven months old and the day before someone had offered to buy us, but we would have had to totally compromise everything we were doing. I called my wife and I was like, “Holy shit, you are not going to believe the conversation I just had.”
That experience crystallized for me the best thing I can do is be a good husband and father, but aside from that this company is the best way I can have an important role in contributing to society.
A lot of people don’t like us and think that I’m a total asshole, but I don’t care because I’ve seen face-to-face people who are alive because of the ACA and how healthcare is changing.
SL: I don’t know your political beliefs, but you live in a more conservative part of the country. Do you get any blowback building a company that jumps off a law like the Affordable Care Act which is so controversial?
SS: I definitely have family members that I don’t talk to about what I do because they would think of it as me supporting the president. There is definitely some backlash. Most of my family is just happy I’m doing something successful. People will always have their biases. I don’t care if you are for or against the ACA, we are just here to get you enrolled in a health plan.
SPONSORED: To learn more about Health Network, click here.