Healthcare FinTech: Emerging Cures for Timeless Problems?

Commerce Ventures
4 min readSep 24, 2020

In our last post, we talked about the changing nature of healthcare payments and the impact of COVID on accelerating industry transformation. We analyzed key pain points facing patients, providers, and payers as each confronts new challenges driven by cost, technology, regulation — and a global pandemic. In this post, we look at potential solutions and emerging models to address these challenges and pain points.

What can we do?

Many of the innovative tools & platforms needed for patients, providers and payers to navigate the current health & market crises have been available for some time. Tools like digital billing, text-based communications, and cloud databases etc. have been commonplace in other verticals for over a decade, but only achieved limited traction in healthcare.

Frequently evolving regulation, customized legacy technology, opposing incentives, and a complex buying experience have long prevented healthcare stakeholders from easily adopting and scaling new ideas. You only have to look as far as the country’s 30 million uninsured and $80B in past-due debt to see the consequences of the industry’s delayed adoption curve.

While many of these hurdles to financial innovation exist independent of COVID-19, we believe that the need to overcome them will be higher than ever. The opportunities highlighted below are ones that address large markets, have been thrust into the spotlight by COVID-19, and sit at the intersection of healthcare and fintech:

  • New coverage models for self-employed and under/unemployed: There are an increasing number of Americans that no longer fit the traditional employer-sponsored healthcare model. Non-traditional workers and those between employment — both growing demographics today — will need new and innovative coverage models that provide access to healthcare. This includes “skinny” health plans that provide the most basic / cost-effective coverage as well as hybrid plans / administrative models that target specific underserved working populations (e.g. Decent, Flume Health).
  • Health plan cost mitigation tools for employers: Rising health plan and healthcare costs will continue to increase cost pressure on employers — many of whom were already looking for ways to reduce health costs prior to COVID-19. Tools like Amino (CV portfolio company) Accolade, Denscore and others that can optimize employee claims, increase preventative care, and / or generally keep plan admin costs down, will be highly sought after.
  • Next-gen health plan fraud and waste detection: Fraud, Waste and Abuse (“FWA”) costs the healthcare industry nearly a quarter of a trillion dollars a year (it even has its own FBI web page!). Traditional FWA mitigation tools are rules-based, manual, retrospective, and often fall apart when faced with new claim patterns. COVID-19 is likely to cause an uptick in both malicious fraud, and unintentional waste & abuse as new billing codes & procedures materially disrupt existing workflows. Cost-conscious Payers are likely to be more open minded about working with new fraud and waste detection vendors that leverage AI & ML to outperform legacy BPO solutions at a fraction of the cost.
  • Empathetic and flexible billing & collections technology: Legacy Provider billing and collections tools and processes — originally designed for B2B interactions with Payers — must be rearchitected for the patient use case. As employees lose their jobs (and healthcare coverage) and their employers push further towards HDHPs, patient burden and delinquencies are likely to rise. Consequently, digital and flexible billing and collections capabilities like those provided by InboxHealth (CV portfolio company) will be more important than ever to practices and their third party medical billers (other vendors in this category include Papaya, MedPilot, Collectly, HealthiPass).
  • Patient affordability tools: The cost of healthcare has been on the rise for over a decade. The pandemic is set to accelerate this rise in cost, increase the percentage of that cost that Patients will be responsible for, and decrease those Patients’ ability to pay for expenses. Financial services and tools that enable Patients to decrease or smooth out the cash flow impact of medical bills will be critical to helping both Patients (who need financial assistance) as well as Providers (who want to minimize patient delinquencies). Pre-appointment patient affordability tools (e.g. Medput, Paytient, FinPay) as well as employer-sponsored and discount-driven health plan alternatives (e.g. Nomi, Healthbridge) will be well positioned to meet this growing need.

The imperative to change our healthcare system is more obvious today than ever. Today’s broken infrastructure is often the source of patients and provider burden instead of serving as the solution.We need to rethink the business models that drive this industry and apply new tech — including the categories listed above — to improve the cost and experience of healthcare.



Commerce Ventures

Early-stage venture capital firm investing in technology innovators in the retail and financial services eco-systems.