If you dare, try searching online for “hospital bill nightmares.” The query will yield page after page of terrifying, outrageous stories.
Medical billing, said Patrick Haig, “is the darkest, most bottomless pit in healthcare.”
But maybe it doesn’t have to be. Haig and Ian Sefferman are co-founders of Goodbill, a Seattle startup that they created last summer to shine a light into that pit, illuminating costs and helping patients unearth and dispute billing errors.
To get the endeavor started, the duo last month launched a more straightforward service.
Since Jan. 15, private insurers have been required by the Biden Administration to cover the costs of up to eight COVID-19 rapid tests per subscriber per month. But even with mandated coverage, Goodbill’s founders thought they could play a role.
“We knew that submitting claims to your insurer is never really that easy or enjoyable,” Haig said.
So Goodbill has a free tool that makes it easy for consumers recover the cost of the test kits.
The team had been building components of the tool for their bigger mission, and saw the opportunity to help consumers in the near term while elevating the startup’s profile. Hundreds of people have used the site to submit their claims.
And Goodbill has attracted the attention of the venture capital community as well, raising $3.4 million in December.
The seed round was led by Founders’ Co-op with investments from Maveron and Liquid 2 Ventures. Goodbill angel investors include Christian Sutherland-Wong, CEO of Glassdoor; Dan Yoo, former chief operations officer of Nerdwallet; David Hahn, former chief product officer of Instacart; Dr. Aasim Saeen, CEO of Amenity.Health; Greg Rudin of Menlo Ventures; and Nick Soman, CEO of Decent.
Anarghya Vardhana, a partner with Maveron, shared a personal story via Twitter to explain her support for the company.
“After a 6-figure bill sticker shock post-delivery of my daughter Baby in the spring of 2020 (hello pandemic baby), I was on a mission to find a company that could, at scale, prevent this from happening to anyone else,” Vardhana tweeted.
Goodbill’s product for disputing medical bills will become available in North Carolina this spring.
The platform will offer a free, entirely automated review of hospital bills and estimate of errors, as well as service in which Goodbill does a detailed review of bills in comparison with a patient’s digital medical records to discover mistakes.
For the more detailed process, a billing coder will review the charges and Goodbill will send records and faxes to hospital review teams to dispute the bills. The startup will participate in negotiating a corrected, final bill, and charge patients a “small percentage” of any savings they realize. Many of the steps will be automated, like the initial bill review and sending basic communications, while some will be done manually.
Haig said it was a great time to launch the effort because more healthcare pricing data is publicly available and people have easier access to digital patient records.
The startup will continue adding regions over time, with the goal of spreading nationwide. They expect the demand will be there. A survey by LendingTree found that 37% of Americans have medical debt, and that most patients who negotiated their bills had their charges reduced or dropped.
Haig and Sefferman would like to create additional tools to help make healthcare costs more transparent, sharing information about what different hospitals and healthcare systems are charging for procedures and services and patient feedback. They’re imagining a site like Glassdoor where current and former employees post anonymous company reviews and share salary information.
Others providing information on healthcare costs include FAIR Health, a free service offering a range of estimates for medical procedures, and fee-based Healthcare Bluebook. Washington residents can use the state’s free Washington HealthCareCompare site to learn cost information by provider for common procedures.
Companies offering bill dispute services and patient advocacy include CoPatient, WellRithms and AdvimedPro.
Sefferman and Haig previously teamed up to create MobileDevHQ, a startup that helped app users increase their reach. The company was acquired in 2014 by Seattle’s Tune, which itself was purchased in 2020. The pair left Seattle in 2018 to launch a startup studio in Detroit, Sefferman’s hometown. Haig has since returned to Seattle, and the two are now focused on Goodbill.
“When we started working in healthcare, it was like, wow, this is incredibly meaningful work.” Sefferman said. “And if we can do anything to put a little dent in the universe and make it just a tiny bit better, that’s really worthwhile work to do.”
