What do smartphones have to do with medical care? Ask any doctor who has called in pharmacy prescriptions from a golf course, reviewed brain-imaging results in a taxi, or video-chatted with emergency room physicians in another city. Or ask PointClear Solutions, an Atlanta-headquartered custom healthcare software development company that recently acquired NYC-based app developer, Worry Free Labs (profiled here last summer). We did, when we spoke with PointClear CEO David Karabinos about the acquisition and the future of mobile apps for patient care.
Why does a healthcare software company acquire a mobile app developer?
We develop enterprise and web applications for clients like Walgreens, the Centers for Disease Control, and Greenway Medical Technologies. We especially seek to work with VC-backed companies that are trying to innovate healthcare. All of them want to provide mobile experiences for patient care. We’ve done some of that in-house, but the demand is so strong that I felt we needed to develop that competency through an acquisition.
If you look at mobile apps on a continuum left to right, on the left side are intensely high-touch consumer apps like Angry Birds or apps that are very much business-to-consumer. These apps are consumer driven, and you’ve got to get it right. On the other end of the continuum, all industries are developing mobile apps defensively, just to say they have one. Frankly, many of those are not very good; companies are just throwing them out there.
One thing we really liked about Worry Free Labs is that they have developed apps for Disney and Apple—very discerning clients. We want to take Worry Free Labs’ experience developing high-touch user experience apps and apply that to healthcare, around patient and consumer engagement in healthcare.
We’re not trying to sell mobile apps commercially. Our strategy is to continue being a services company that develops apps for small, medium, and large companies.
Yours is a rare software company that employs nurses.
We apply a heavy dose of user experience and clinical skill set knowledge and competency. The team includes people with patient-care experience, including nurses who got involved in technology products during their careers and jumped the fence to focus on technology instead of healthcare delivery.
What do you think the future holds for consumer experience in healthcare technologies?
In the last 5 years there’s been a wave of tech adoption in healthcare, primarily forced by public policy and laws such as the Affordable Care Act and the Health Information Technology for Economic and Clinical Health (HITECH) Act, which was enacted as part of the American Recovery and Reinvestment Act of 2009.
There’s been a big gulp of technology adoption by the healthcare provider community. This wave of forced adoption is going to end in 2017 because the HITECH law says that’s when doctors must have adopted electronic health records or their Medicare benefits will be cut.
The healthcare industry has been a laggard. So the question is, how is the industry going to react? Are they going to say, “we’re good, we’re done with this,” or will they say, “we want more innovation; we’re going to continue on this journey”?
We believe healthcare innovation will be among the top five areas where venture capital will be applied—in particular around healthcare consumers and doctors and clinicians. I’m a VC guy, and I ping my network all the time to cultivate their opinions, so this is a somewhat informed opinion.
On the consumer side you hear about patient empowerment and engagement. It’s been lip service, but these things take time. The big game changer is going to be the advent and deployment of really good mobile apps to help consumers in purchasing and managing health insurance and healthcare.
Obamacare is forcing consumers to be more engaged in purchasing health insurance. Over the next several years, employers are going to abandon the existing model and force employees to go buy their own insurance. This is a sea change. Consumers are going to have the tools and access to go shopping for insurance, to make choices.
My thesis is that mobile apps are going to overtake web apps over time. As a consumer, I want to engage with my healthcare provider, make appointments, renew subscriptions, and see lab results through my mobile device. Those are transactional things that matter to me. I don’t want to go to a website, log in and wade through a complicated set of screens. I think mobile apps are going to have a huge impact on how patients as consumers take more responsibility and get more engaged with their health care.
What are some examples of apps you see PointClear developing?
We’re already developing them. Our client Walgreens bought Take Care Health Systems a few years ago. They run employer-based clinics. Companies including Intel, Microsoft, and HP are outsourcing to systems like Take Care Health to provide healthcare to employees at clinics on their own campuses. PointClear has developed portals for all of that to work.
Walgreens is strategically shifting from being a retail pharmacy to a healthcare provider. They’re not only putting these clinics inside their stores, but they’re providing family and chronic care. We’ve developed apps for that business, such as mobile appointment reminders.
Other apps we’re developing are around doctors and clinicians at medical practices and hospitals. These apps won’t be just inside the healthcare facility, but helpful in the delivery of healthcare around the clock. Here’s one example: I play golf, and a lot of my buddies are doctors. On a Saturday morning I cannot tell you how many times we’re walking down the fairway and one of them is on the phone, texting, or calling in a prescription to a pharmacy. Mobile apps are going to replace that analog experience with a digital experience where the doctor can click a few buttons and be engaged with a patient through the app on the golf course.
We’ve also developed apps that interface with a lot of devices and fitness applications. At PointClear we target anybody interested in innovation, and that comes in small, medium, and large flavors.
We do have clients that are taking quantum leaps or creating destructive innovation. An example of that is a client that has developed groundbreaking 3D scanning technology and is applying it to the hearing-aid market, which, by the way, is huge.
Traditionally, if you need a custom hearing aid, you have a mold of your ear cast and sent off to have the device made. The process takes weeks and when you get it back it may or may not be the right fit.
Our client has developed a scanner called Otoscan. They put it next to your ear and it creates a 3D rendering of the inside of your ear. We’ve developed the technology to take that through to order fulfillment. The cycle time becomes hours, not weeks. It’s going to be disruptive. It will be brought to market by United Sciences, the largest distributor of hearing aids, and will be in doctors’ offices in the next six months.
As an investor in this space, as well as a CEO, what else excites you?
I really like the Healthcare Unbound segment of healthcare, and Health 2.0, where communities of companies and investors are looking at technology for delivering care outside of traditional facilities.
Telehealth is a big one, and adoption of that is finally accelerating. The insurance industry now says telehealth has proven itself, so they’ll start paying for it. It took off originally in rural settings, but now it’s taking off even in urban areas. The main apps there are not only for doctor-patient engagement, but to enable doctor-to-doctor consultations about patients.
[Ed. Note: To learn more about what Karabinos and other investors are looking for in healthcare technology companies, check out a free webinar panel discussion he will host on Wednesday, April 16, at 2:00 pm EDT, with three healthcare technology venture capitalists.]