Learn More About This Innovative Healthcare Insurance From Marpai Inc.'s ($MRA) CEO Edmundo Gonzalez
Marpai brings deep learning and machine learning to the rapidly growing, low-tech TPA sector to deliver a superior value TPA experience to employers and their health plan members. For the same price as an average TPA, Marpai proactively engages members in an effort to reduce avoidable, excessive, inappropriate and overpriced care. Marpai uses AI to identify and connect at-risk members to proven clinical solutions early, reminds members to make annual exams and guides them to high-value in-network providers. The myMarpai App is a personal health GPS that gives members on-demand access to benefits, costs, deductibles, telehealth and more. No TPA offers these services in their standard fee. Marpai has its own PBM (pharmacy benefits management solution), MarpaiRx, that offers deep discounts on medications and significant savings to employers.c
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NewsTranscript
00:00 - Hey everyone, it's Jordan Robertson with Benzinga,
00:02 and joining me today is Edmundo Gonzalez,
00:04 co-founder at Marpay.
00:06 How are you?
00:06 - Very well, thanks.
00:07 Good to be here.
00:08 - Amazing.
00:09 So to get us started today,
00:10 can you give us an overview of the company?
00:12 - You bet.
00:13 So Marpay is in the business of predicting
00:16 and modifying risk in healthcare.
00:19 What that means is that we manage hundreds of health plans
00:23 for employers around the country.
00:25 We basically help businesses around the country,
00:28 as well as local government agencies,
00:31 like school districts, for example, or a town.
00:34 We help them get control of their healthcare spending,
00:37 which is often the second largest expense
00:41 for any employer outside of payroll.
00:44 And all of our clients have been seeing
00:47 the trajectory of healthcare only have one direction,
00:50 which is up, up, and up.
00:53 With us, we can really help them bend that cost curve
00:59 over time in a way that they can provide great benefits
01:03 to their employees while also controlling their own costs.
01:07 At the end of the day, Jordan,
01:08 healthy populations cost less.
01:10 That's what we do.
01:11 That's what we deliver for our clients.
01:13 - Amazing.
01:14 And how is the Marpay Healthcare Insurance Plan different?
01:17 - Well, we're different in that
01:18 we don't just pay healthcare claims.
01:21 We actually look at the health of our members.
01:24 Members are basically employees,
01:27 as well as dependent children and spouses
01:30 of employees that are employed by our clients
01:34 who are all self-insured employers.
01:36 What does that mean?
01:37 Self-insurance basically means that a business says,
01:40 "You know what?
01:41 I'm not gonna buy the traditional health insurance.
01:44 I have enough employees where I'm gonna self-insure,"
01:47 meaning I'm gonna pay for my employee's visit
01:50 to the hospital or to their doctor as it comes.
01:53 But as you may know, paying a medical claim,
01:56 it's not like paying the light bill.
01:58 There's art, there's science, there's a lot of complexity.
02:01 That's where we come in.
02:02 We make it very simple for businesses across the country
02:05 to basically self-insure,
02:08 get often 25 to 30% savings
02:11 versus the traditional insurance,
02:14 but we manage all of that benefit.
02:16 We take all the complexity out for our employer clients.
02:21 That's really the difference.
02:22 And the other big difference, of course,
02:24 is that we're looking at the health of the populations
02:28 we're lucky enough to serve.
02:30 So we are in front of health events,
02:33 which are with our own care management,
02:35 with our own nursing staff,
02:37 to make sure that the populations we serve
02:40 are making the best choices for their own health.
02:43 Again, healthy populations of employees cost less.
02:47 Wonderful.
02:47 And how do you use AI and machine learning
02:49 to reduce costs of third-party admin
02:51 of company health plans?
02:52 And also, what sort of efficiencies are you finding
02:55 that did not exist before?
02:57 Look, so AI is impacting everything, right?
03:01 It's impacting healthcare.
03:02 It's impacting so many industries.
03:04 We were actually born as an AI startup.
03:09 And along this journey,
03:11 I decided essentially to buy our client.
03:14 That's how we got into managing health plans.
03:16 We wanted to do this because we wanted to access
03:19 big populations at scale very, very quickly.
03:23 That's why we went into the administration business.
03:27 But AI, basically, the most pervasive use of AI
03:31 and the most high-impact use is really in looking
03:35 at the actual populations we serve
03:38 in predicting where a member is going to be
03:41 or where a member is going
03:43 with respect to his or her health journey,
03:46 and then getting in front of it,
03:48 meaning having, again, a nurse or another clinician
03:51 contact that member and making sure that member
03:55 is in the best care possible.
03:58 We are also matchmaking our members
04:01 to the best providers out there.
04:03 There are in-network providers for networks
04:06 that we work with, like Aetna, Cigna,
04:08 as well as a whole host of smaller regional networks,
04:13 but also even our own network of value-based providers.
04:17 We are very good at identifying a member
04:20 that may benefit from a specialized provider.
04:23 For example, one that may treat and reverse,
04:27 in many cases, type 2 diabetes,
04:30 or one that may treat muscular skeletal issues.
04:33 We are the matchmaker.
04:34 We're in the middle, and we are bringing
04:37 these innovative solutions to our members,
04:41 making sure that they're actually in the program,
04:43 staying in the program,
04:44 and then, of course, measuring everything,
04:47 because our clients want to make sure
04:50 that the programs are working,
04:52 and working for us means two things.
04:54 First, first and foremost, the most important thing,
04:57 are health outcomes improving?
04:59 That's what we're all about.
05:02 But also then, if they are,
05:05 are my costs going down as a self-insured employer?
05:09 So measuring that over time with our ecosystem
05:11 is very, very important to us.
05:13 - Absolutely, that's fantastic.
05:14 So you just launched your vitality plan
05:16 aimed at smaller employers,
05:18 a market that has nearly doubled since 2011.
05:20 What makes this an ideal solution
05:22 for employers of this size,
05:23 and do you see this rapid growth of smaller employers
05:26 opting for self-funded programs continuing?
05:28 - I do, I do.
05:29 So let me answer the second question first.
05:32 So smaller businesses now, of course,
05:34 after the Accountable Health Act,
05:37 also known as Obamacare,
05:39 smaller businesses now have to have insurance, right?
05:42 This is businesses that are 50 employees and above.
05:46 Now, that has brought a tremendous amount of businesses
05:50 into the marketplace of health insurance, of healthcare.
05:54 Many of these businesses before did not have
05:57 to offer healthcare to their employees.
05:59 Now, what does that mean?
06:01 They have gone and bought traditional health insurance
06:05 from the big insurance companies.
06:07 The issue with that is that they're phenomenal products,
06:10 but they're very, very expensive.
06:12 So smaller businesses that are, say,
06:15 between 51 and 100 employees,
06:18 often find it cost prohibitive
06:21 to buy traditional insurance.
06:24 That is what's fueling the growth of small,
06:28 small businesses are fueling the growth in our space,
06:31 which is self-insurance.
06:32 Traditionally, by the way, meaning 20 years ago,
06:35 this was a space for larger businesses.
06:38 So if you had 500 employees,
06:39 of course, 5,000, 50,000 employees,
06:42 of course you were self-insured
06:43 because you're big enough to have
06:45 essentially a little insurance pool
06:48 within your employee population.
06:50 But now that the dynamics really exist
06:53 for smaller businesses of 70 employees, 80 employees.
06:57 This is very, very exciting.
06:59 What we've done with Marpay Vitality
07:02 is basically put everything in a box,
07:04 if you will, a virtual box.
07:06 So we make it easy for smaller businesses
07:09 that may not have the human resource infrastructure
07:13 or big departments, again, they're smaller businesses.
07:15 We make it easy for them to become self-insured
07:19 and we provide everything that they need,
07:21 access to the best networks,
07:24 obviously all of the claims processing,
07:27 the customer service that their employees deserve.
07:30 We put everything together and make it very easy
07:32 for their employees to onboard into our program.
07:36 That's what Vitality is all about.
07:37 - Yes, absolutely.
07:38 And last question here for you,
07:39 what should investors be watching out for
07:41 in Marpay's future?
07:43 - Look, in the near future,
07:44 and this is already coming to pass,
07:47 we are becoming, we're on a journey
07:51 to become profitable in 2024.
07:54 We're a young company.
07:55 I only started this a few years ago.
07:58 We're almost at $40 million of revenue.
08:03 That's from zero, literally a few years ago.
08:06 So we've been on quite a rapid growth path
08:11 and we have accelerated our pace towards profitability
08:15 because that's what the market wants and we agree.
08:18 So you'll be seeing in our earnings calls,
08:21 quarter after quarter, our adjusted EBITDA,
08:24 which takes away the effects of restructuring
08:28 from companies that we have purchased,
08:31 the severances, leases, all of that.
08:34 And it really gives you a window
08:35 of what profitability looks like in the near future.
08:39 You should be looking at that quite intently
08:42 and looking at the EBITDA loss
08:44 gets smaller, smaller, smaller,
08:45 and then obviously switching to the other side in '24.
08:49 Everyone in our company is very, very focused on this.
08:53 And you know what?
08:54 Even at our scale, it's very, very achievable.
08:57 Very achievable.
08:57 - Well, big congratulations to you guys.
08:59 That's all I have for today.
09:00 And I hope to see you back real soon.
09:01 - Thank you so much, Jordan.
09:02 My pleasure.
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